Agricultural policy matrix
Dr. Sardar Riaz A. Khan
Agriculture is the mainstay of Pakistan's economy. It contributes 25 per cent to the GDP and nearly 70 per cent of the total exports beside, engaging 44 per cent of the total labour force.
In spite of such a significant role of agriculture, the sector was allocated only one percent of the total budget for the year 02-03 whereas it should not have been less than 5 per centof the budget.
The major part of allocated budget is spent on salaries and maintenance while the remaining part is not sufficient for any meaningful development of the sector.
The government is developing policy matrix for future development of the agriculture. The approach should be to frame a policy with least dependence on foreign loans as far as possible. In any future policy, top priority be given to problems which need immediate attention for streamlining the shattered economy. Again, there is under-utilization of development budget due to not timely approval of the development projects and slow progress of the approved schemes due to one or the other reason. The progress of the various projects needs to be monitored and evaluated regularly for timely removal of constraints and checking mismanagement.
Pakistan has signed the Agriculture Sector Programme - II Loan with the ADB and the total amount of the loan is $350 million. The primary objective of the programme is to improve agricultural productivity and profitability. A number of suggestions were submitted by the meeting of agricultural experts held on June 17. My personal opinion on some of the policy issues is given below:
The distribution of improved seed of major cereals is less than 10 to 15 per cent of the total requirements. The rest of the seed travels from farmer to farmer and gets mixed up. Again, private sector sells sub-standard seed labelled as seed of recommended varieties. This problem needs immediate attention of the policy makers.
Again, varieties of crop like wheat, cotton, rice etc. are recommended causing confusion among farmers. The feasibility of recommending only a few top varieties may be considered. Extension education and training programme be initiated by the public sector to train farmers for producing high quality seed to meet their own requirements.
Support price: Various parameters have been suggested for fixing prices of wheat, cotton, rice and sugar-cane. Whatever the basis for fixing their price, it should be ensured that growers get the fixed price to avoid losses to them, especially the small and subsistent level farmers who cultivate over 61 per cent of the total farm area. Again, the sugar and textile industry do not pay on time to sugar-cane and cotton-growers causing them lot of problems.
It is incomprehensible that during the years when domestic production is sufficient to meet the requirements of the textile industry, why the industry is allowed to import cotton as 1.3 million bales of cotton imported during this year against 10.7 million bales of domestic production plus last years stored stock. Again, on the one hand we import sugar, on the other, sugar mills/exporters are not only allowed to export sugar but also are provided with subsidy to compete in the international market due to high cost of domestic sugar production. This causes unnecessary burden on the national economy.
The policy should be to first meet the domestic requirements and only if any surplus is left, be allowed to export. Similarly, rice, our second largest export crop, is facing problems of support price and export during the last two years. Due to the inept policies, export of fruits and vegetables is also far below their potential. The policy matrix should be stream-lined to overcome the above-mentioned problems for greater export earnings.
Lack of storage:
Fortunately, we are exporting wheat since 99-2000, but due to poor storage facilities, most of the wheat is stored openly and covered with tarpals. This results in deteriorating of its quality which causes problems of competition in the international market. Government should develop policy for proper storage facilities, both in the public and private sector.
The policy matrix lays major emphasis on cotton, wheat, rice and sugar, but no planning has been shown in the matrix about the oil seed, in spite of the fact that we are importing edible oil worth Rs30-40 billion annually causing heavy drain on our national exchequer. The intended policy matrix should also include policy options on becoming self-sufficient in edible oil.
Under this policy matrix a feasibility study acceptable to the ADB will be undertaken for allowing greater administrative and financial autonomy to provincial research institutes. A comprehensive study on this subject has already been undertaken at provincial and federal levels under the Agricultural Research Project - II financial by the World Bank costing million of dollars. The nation can not afford the luxury of repeating this exercise. The research constraints, measures to over come them and giving administrative and financial autonomy has already been discussed and suggested in greater details in ARP-II. So there is no need to repeat this study.
The policy matrix did not mention about the development of rain-fed agriculture in spite of its contribution to national production, e,g wheat 10 per cent, maize 27per cent, sorghum and millets 56 per cent, barley 52 per cent, gram 77 per cent, pulses 89 per cent, rape and mustard 24 per cent, groundout 89 per cent, guar seed 90 per cent, castor seed 100 per cent.
Conventional rain water harvesting methods collects 25-30 of rainwater, while modern rain water harvesting techniques collects upto 90 per cent of rain water thus significantly increasing yield of rain-fed crops. Therefore, policy matrix should include development of modern water harvesting technology in our potential rain-fed areas initially. After gaining experience it could be extended to other arid and semi-arid areas.
Again, there are 14 hill torrent areas with an average annual water conservation of 18.6 MAP at 1204 sites, out of which 60-70 per cent can be used for development of 6.35mha of wasteland lying in these areas. The previous conservation structures failed as they were not based on sound engineering principles and this mistake should not be repeated while building new conservation structures.
This is good project as the exiting crop yield are 50-71 per cent below their achievable potential. This project was initiated by the PARC some time back. The annual progress reports of this project be studied to understand various pros and cons of this programme. The project be initially started in one village in each district having larger number of small and subsistent-level farmers. Because over 61 of the total farm land is owned by these two categories of farmers who cannot afford high cost of inputs for obtaining higher yields.
After selection of a village, the requirement of inputs and credit be calculated and provided before the sowing time. Proper education training be provided as how best to use the inputs and to maximize productivity. The credit be recovered in cash or kind whichever is suitable to farmers as has been successfully done in Indian Punjab to maximize farm yields. To achieve the aforesaid objective the departments of Agriculture Extension. On-farm management and irrigation must coordinate and be made responsible and their activities be monitored and evaluated for the success of the project.
There is a good potential of increasing the yields of dry-land crops by over 200 per cent by adopting water harvesting techniques. For example, in Mustang area of Balochistan, where no dry-land wheat was ever obtained due to low rainfall, wheat crop was successfully obtained by Arid Zone Research Institute, Quetta by following modern water harvesting techniques. It is suggested that crop maximization programme should also be initiated in rain-fed areas. One village each in a semi-arid and sub-humid region be selected for maximizing the production of rain-fed crop in these two ecological zones. With success and gaining experience, the programme could be extended to other ecological zones for increasing dry-land crop yields.
Lastly, no matter how well a project is prepared unless it is implemented at field level, no target can be achieved. Therefore, the policy metric should be such which is practicable at the field level.