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Punjab agri-policies

June 24, 2013

WITH little time at its disposal, the PML-N government in Punjab seems to have hurriedly put together its agriculture budget.

The fear is that the provincial government will be working on cross purposes, creating confusion, compromising results and wasting money. One hopes that these issues are noted during the debate on the finance bill and get corrected before the bill is passed.

Major initiatives like Rs7.5 billion bio-gas and solar tube wells subsidy plan and Rs4.50 billion (out of total Annual Development Plan of Rs5.5 billion) Punjab Irrigated Agricultural Productivity Improvement Project are examples of the provincial governments’ discrepancies.

In the past few years, sub-soil water mining has turned out to be a big issue in Punjab as under-ground water levels started dropping steeply. In some parts of the province, they dropped down to over 1,000 feet. According to some estimates, the province gets 54 million acre feet of water annually and pumps almost equal amount out of soil every year, with two adverse results: shrinking sub-soil reservoirs and cumulating minerals on surface that affects the soil’s health.

These results forced Punjab into withdrawing politically sensitive subsidy on tube wells’ electricity bills in 2009-10. High bills were hoped to serve as deterrent against water mining. Punjab also started Rs36 billion Irrigated Agricultural Productivity Improvement project for brick-lining 7,000 watercourses, install High Efficiency Irrigation Systems (drip and sprinkle) on 120,000 acres and provide 3,000 laser levellers to farmers.

All these plans had two purposes: saving sub-soil water and increasing productivity per drop. Amidst all the high cost initiatives, Punjab has now come up with a parallel plan, solar tube wells, that will take pressure off farmers to conserve water. These solar tube wells would provide farmers a facility of pumping out sub-soil water at least 16 hours a day, without any running cost.

However, there seems to be a policy disconnect between the two projects. Power crisis is a reality of national and agricultural life in Pakistan, particularly Punjab. But the problem of sub-soil water is equally important if not a bigger issue. Allowing one of them worsen the other is hardly a prudent policy. Punjab needs to create a balance between both.

Similar is the case of bio-gas subsidy regime. Even when Punjab was announcing its bio-gas initiative, the natural gas supply system was being extended to its villages as per its pre-election promise. If one gets assured natural gas supply through pipes, why would he shift to a supply system? Punjab should have conducted a performance audit of such systems, which some individuals had installed a few years ago and then abandoned. If the province wants to convert its farmers to bio-gas, it needs to create some supply pressure along with a massive awareness and education campaign to convince them.

On a brighter note, Punjab has promised to improve its agricultural tax collection from Rs700 million this year to over Rs2 billion next year. For achieving the target, the province says that anyone possessing more than 50 acres of land will have to file tax returns under normal income tax mode, even if the owner has suffered financial losses and has no taxable income. Though the sector has much more potential, this increase, if the province is able to achieve it, can only be welcomed.

Logically, farmers with 50 acres, especially in the irrigated areas, with a cropping intensity of 150 per cent and growing high-value crops, must have substantial taxable income. The Agriculture Census show that top six per cent farmers hold around 32 per cent of (total 4.1 million acres) land in the province.

This lopsided ownership pattern must reflect in tax collection as well. The net should be expanded as far as, and as quickly as, possible.

Punjab is also giving attention to and money for agricultural education and decided to extend the network. Multan Agriculture University, which was announced two years ago, is expected to become a reality this year. Faisalabad Agriculture University would have a sub-campus in Burewala. A mango research institute will be built in Multan.

Hostel facilities will be provided for female employees and farmers at Ayub Agriculture Research Institute (Faisalabad). For those already in-service, a training facility will be established at Karor (Lyyah). All these plans are a welcome addition to the education and training network.