ISLAMABAD, Feb 10: With ever-declining production in agriculture sector, poverty is increasing in rural areas of the country, says a report.
According to the report prepared by Centre for Research on Poverty Reduction and Income Distribution (CRPRID), poor marketing facilities, inadequate farm-to-market roads, warehouses, cold storage facilities, grading and processing facilities are responsible for squeezing incomes in the rural areas.
The report said though the government had been fixing the prices of various agricultural commodities, however, it failed to help the farmers due to lack of effective intervention in the market.
Moreover, the government is not very consistent in announcing the support prices, which had affected the output level of various crops, it added.
The report suggested that the support price mechanism should continue and strictly enforced.
As a result, agriculture growth rate exceeded four per cent in 1988-98. However, over the last couple of years owing to continuing drought and inconsistent support price mechanism, agriculture growth declined to 1.8 per cent.
The report also said distribution of improved seed decreased from 79.9 to 63.9 million tons by 1992-93, but increased rapidly to 145.1 million ton in 1995-96.
However, since then it showed declining trends until 1999- 2000 due to problems in breeding, multiplication and distribution of improved certified seed to the end users.
The use of fertilisers declined due to higher fertiliser prices relative to the output prices, which were compounded by problems like shortage during peak demand periods, adulteration and under baggage.
The report said cultivable land in the country was unequally distributed. About 47 per cent of farmers possess less than two hectare and cultivate on only 12 per cent of the total cultivable area, whereas about 19 per cent hold five hectare or more and cultivate on 61 per cent of total cultivable lands.
The skewed distribution of land and lack of implementation of tenancy rights intensifies poverty in rural areas. Therefore, strong tenancy rights should be defined and implemented.
Due to these factors, the farmers operating at very small and extremely marginal holdings are caught in poverty. These farmers as well as landless workers can be pulled out from poverty and pressure can be reduced if other opportunities are provided to them, the report said.
To achieve this, it is essential to encourage investment in small village-based industries, it added.
The contract-farming style should be introduced by providing necessary infrastructure and encouraging investment in processing of high-value crops.
Therefore, an active coordination between public and private sector can help increase the agriculture output which in turn will have positive impact on the poor farmers, it added.