The federal budget for 2022-23 has disappointed the farming community which feels the document lacks any vision and leaves the real issues — water, fertiliser and cheaper fuel — of the agriculture sector unattended with no efforts to reduce the cost of producing crops.

An allocation of Rs21 billion has been made to finance a ‘vague’ three-year growth strategy for agriculture and its subsector livestock without a plan or an explainer of whether the allocation is for a year or the full three-year life of the strategy.

“Vision is missing from the budget as allocations made for the agriculture sector have been spread in bits throughout the document making things foggy,” complains Ibadur Rehman of the Farmers Association of Pakistan (FAP).

Referring to the ‘confusion’ among the policymakers, he says a meagre sum of Rs12bn has been apportioned for constructing dams while Rs100bn has been earmarked for command area development. “How can one construct a canal without having water to release into it?”

The absence of vision indicates the confusion of policymakers

To overcome canal water scarcity, cultivators turn to subsoil water resources but either electricity is unavailable or it is too costly while running water pumps on diesel is also not affordable. Mr Rehman is perturbed that no clear steps have been announced to resolve these issues rather the Rs750bn petroleum levy is a hint that oil prices are set to go further up.

Regarding the 150 per cent hike in subsidy for fertiliser plants, he says the primary question is the availability of urea and not its higher price as witnessed in the last Rabi and the ongoing Kharif season during which farmers had to stand in long queues for hours only to get one or two bags of the compost. The subsidy also seems withdrawn as the Finance Bill proposes increasing sales tax on fertiliser from 2pc to 10pc.

The FAP leader believes that the government will succumb to pressure from the International Monetary Fund and reverse the sales tax exemptions announced for farm machinery. He also wonders about the policy of promoting oilseed production without bringing new lands under cultivation since oilseeds will eat into wheat acreage as both crops share the same season and area.

Aamer Hayat Bhandara, a progressive farmer, believes that tax cuts for seed and farm tools are insufficient motivation because their primary concern is minimising production cost.

But unfortunately, water is not available, electricity is expensive and diesel prices are negatively impacting every stage from cultivation to harvesting, making transportation of commodities to market expensive. “How does the government hope to improve crops and livestock production without taking any worthwhile step for the purpose?”

Published in Dawn, The Business and Finance Weekly, June 13th, 2022