THE Sindh Agriculture Department has sought policy changes in the upcoming budget for efficient, competitive and sustainable development of the farm sector to help reduce rural poverty and ensure food security.

It plans include value-addition in fruits and vegetables and improvement in farm productivity. On its proposed priority agenda is: the development of hybrid seed; conservation of available water resources by promoting drip/sprinkler irrigation system; lining and construction of water reservoirs; tapping underground water through tube wells, provision of subsidised solar pumps to farmers, and strategy to face climate change.

The development outlay for the next financial has been proposed to be jacked up by 6.4pc to Rs4.79bn from Rs4.5bn in the outgoing fiscal year. But official sources do not rule out an eleventh hour increase in the ADP’s size considering possible changes in the development schemes.

Until last week of May, according to a provincial finance source, the Sindh Finance Department released Rs2.4bn, or 55pc, of the total Rs4.5bn allocated for agriculture sector. An amount of Rs1.3bn was spent on various schemes by May 27. More releases were in the pipeline until first week of June.

The agricultural department has proposed drip irrigation on 5,000 acres on a cost-sharing basis with farmers meeting 40pc and the government 60pc of the expense

According to the source, if the released amount is not fully used or wasteful expenditures have occurred, fiscal discipline will be enforced. Utilisation figures show that 75pc of the released amount was used by the agriculture supply and prices wing and 74pc by the mechanisation department whereas three other sectors reported below 50pc spending on their schemes, ranging from 42-47pc up to May.

The agriculture sources argue that the moot point is not huge allocation but actually the pace its releases by the finance department. According to them, Rs1.7bn was released against Rs4.5bn by April 2016 or a mere 38pc against allocated funds. And out of Rs1.7bn, Rs1.025bn was spent.

For the next year’s budget, the agriculture department has proposed 17 new schemes with a total outlay of Rs967.196m. Of these, three are for research sector (Rs90m); five each for agriculture extension projects (Rs145.500m) and farm mechanisation (Rs590m); and four water management schemes (Rs141.696m). Besides, the ongoing schemes are to be completed at a cost of Rs3.8bn.

The proposed Rs4.7bn, allocated for the agriculture sector in Sindh’s ADP 2016-17, will provide: 1,200 agriculture implements; subsidy on purchase of 5,000 tractors. In all, 73 solar tube wells would be installed on a cost-sharing basis with farmers bearing 20pc and the government 80pc of the expense.. About 236 tube wells will be installed with a 50pc subsidy. Additional lining of already improved 219 watercourses is to be carried out. Around 300 farmers would be trained and 120 farmers’ field schools would be established by the Agriculture Extension Department.

The World Bank-funded Sindh Irrigated Agriculture Productivity Enhancement Project will help install 715 tube wells; improve 1,000 watercourses; drip irrigation on 5,000 acres on a cost-sharing basis with farmers meeting 40pc and the government 60pc. A total of 300 laser land-levelling equipment and 100 deep ripping (chisel ploughs) would be provided (on a cost sharing-basis) and 71 community flood shelters would also be set up in different districts.

The slow pace of project execution is attributed by the agricultural department to the fact that the first quarter of allocated funds are usually released sometime in October-November instead of August, if not July, when the department calls bids for works. “There has to be a final date every year when funds should be released so that money is spent accordingly.,” says a senior agriculture officer.

The Sindh finance department had linked funds’ releases with spending on projects/schemes in the outgoing fiscal year through automated procedure. Under this mode the second installment of funds was released only if 60pc utilisation of released funds was confirmed. “But in case of agriculture department, until May it couldn’t even utilise releases of Rs2.4bn,” says a Sindh finance source.

The finance officer points out that this year the provincial finance department didn’t have any issue of finances and departments were given adequate releases subject to satisfactory utilisation. The Sindh finance department did withhold releases only in those cases in which the planning and development department didn’t find performance in tandem with pace of releases. He disclosed that releases of agriculture department remained slow throughout the year.

Published in Dawn, Business & Finance weekly, June 6th, 2016