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New hope
for agriculture
It is heartening to
learn from a Business Recorder report from Islamabad that the
government has given initial approval to Rs 3.1189 billion
Public Sector Development Programme (PSDP) for the Ministry of
Food, Agriculture and LIVESTOCK (Minfal), with a marked
increase of Rs 1,700 million in the volume of Agricultural
Sector Development Loan (ASDL).
It will be noted that the major chunk of this allocation - a
little over Rs 2,000 million - which would go to ASDL in
2004-05 would far exceed the Rs 300 million allocated in the
current year's budget.
The big increase in the volume of farm loans this time has
been attributed to the government's concentration on improving
the lot of small farmers. The report under reference also has
it that the allocated amount would be transferred to the
provinces, as the provision of loans to the farmers is a
provincial subject. All this sounds quite well but, perhaps,
the uncertainty about the share of each province in its
distribution as now prevailing can delay the process of
efforts desired to be made through these loans.
The Minfal is stated to have demanded over Rs 3 billion for
PSDP in the next, primarily, out of its keenness to build up a
diversified plan to take up 21 new schemes to develop
agricultural infrastructure and to ensure availability of
inputs and pesticides.
After its thorough discussions, the Finance Ministry, Planning
and Development Division and the Minfal have agreed in
principle to approve the PSDP. Moreover, the priority
committee held various meetings on the public spending plan,
which is 100 percent higher than the last year's allocation of
over Rs 1.5 billion. Now it will have around Rs 1,300 million
in local currency and Rs 1,450 million as foreign currency
component, while Rs 140 million would be met from own
resources.
The total number of development projects planned by the
ministry with a total cost of Rs 1.1189 billion reportedly
stands at 43. The plan envisages loan to the growers as a
major component, which is presently being provided by
commercial banks, besides Zarai Tarraqiati Bank Limited (ZTBL).
The sources said the PSDP also includes allocations for 32
ongoing projects. According to the report, the Planning and
Development Division has approved 11 new schemes.
According to an earlier report, Minfal had identified various
areas to focus investment in the sector and aimed at
increasing economic growth, with public sector support and
participation of the private sector.
These include storage facilities, improved research, quality
control laboratories, seed, water and LIVESTOCK sectors,
fruits and vegetables, marketing, integrated pest management
and aquaculture, besides corporate farming.
Enormous possibilities were also noted as existing for
co-operation and support from international financial
institutions and developed countries. Some of these areas will
be open to foreign private investments. As for storage
facilities, it was pointed out that Pakistan has been
suffering heavy post-harvest losses in agricultural produce,
which it would seek to address through scientific approach in
accordance with modern trends.
Reference, in this regard, was made to a number of incentives
for the private sector investment for construction of improved
grain storage facilities. Moreover, considerable emphasis was
laid on research on hybrid breeding, which has remained
limited only for a few crops, namely oilseed and maize, thus
stressing the need of encouraging investment on hybrid seed
production.
Reference was also made to incentives announced in this regard
by the State Bank of Pakistan (SBP) and the government for
investment in this area, pointing to the prospects of overseas
private sector making investment in improving research
facilities for this purpose.
With regard to corporate farming, attention was focused on the
announcement of corporate agriculture farming scheme, which is
aimed at bringing more area under cultivation on lands lying
barren, to overcome the land fragmentation problem as well.
It had also been observed that corporate farming would not
only help improve the quality of produce but also serve the
purpose of value addition to farm produce, thereby, spurring
development of modern and competitive agriculture.
All this put together, would point to a new hope for the long
depressed sector. It will, however, be noted that the
allocation of Rs 300 million in the last budget was not fully
utilised, thereby, suggesting lack of timely and full
utilisation of the allocations.
Copyright Business
Recorder, 2004
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