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Agri Overview

Focus on agriculture budgeting                         Home
By Zafar Samdani

WHILE the Punjab government has ambitious social sector sights, it is aware that the strength of the province rests in its agriculture and livestock and is expected to subject the sectors to sharp and sympathetic focus in the coming budget.

Focus on agriculture budgetingIts intentions and plans have however been derailed to an extent by the federal government’s decision for duty free imports of some vegetables and meat animals from India. The decision has thrown a spanner in the wheel of progress for the rural areas of the province that house over 60 per cent of population of Punjab that lives by agriculture activities or by breeding livestock.

Vegetables have traditionally been the prime produce of farmers living on the periphery of big cities. Such cultivation has been under pressure for decades because the policy of expansion, the successive governments have pursued for urban housing, forced small farmers living on the fringes of cities to sell their lands to government agencies at throwaway prices.

Real estate developers followed close on the heels of official town planners and purchased farm lands near cities. Almost every habitat of over one million population has vast areas purchased by these developers waiting for their turn to raise houses on lands that were known for raising vegetables, particularly onions and tomatoes, two items on Pakistan’s import list from India.

However, the outer circles of expanded cities remained agriculture land and vegetables continued to be grown by these farmers. They would now have to look for alternate crops. That is none too easy because most tracts of lands have undergone extensive fragmentation due to division through inheritance; their size is no more unsuitable for major cash crops.

The market for other vegetables and fruits like melons and water melons is also saturated by the produce from other farmers who find the marketing of their goods hard going because the cultivation cycle of Sindh is about a month ahead of Punjab and many of the items Punjab’s farmers grow are disadvantageously placed by the time they are ripe for selling.

The federal government’s imports from India-China is also an option for the imports but that is an academic possibility only, came too late for the provincial government to try to offset its impact on vegetable growing small farmers and in any case, the issue does not appear to have been accorded serious consideration by the administration. Other than that, it has agriculture and livestock as priority areas for the next budget.

The government has already launched a major initiative to boost livestock by announcing easy loans for setting up livestock farms and extending veterinary facilities for animals but this project would remain in addition to allocations in the budget.

In view of the fact that agriculture produce mostly sells below the cost of production and it is livestock that gives breathing economic space to farmers, planners are closely looking at the breeding scene and analyzing problems and issues it confronts.

The most important problem in this regard is extremely restricted fodder crops that are a factor in keeping animals under nourished and consequently low in milk and meat yield. Fodder production appears to be an area on which the government would be concentrating. The area under fodder crops cannot be extended widely as cash crops are more to the taste and economy of individual farmers. Setting up small feed mills for fodder is one of the proposals the government is reported to be considering to increase fodder for nourishing animals.

While meat animals from India would be imported, approximately about one million of them under the duty free import strategy, ostensibly to reduce the price of meat, experts feel that the market is unlikely to undergo reportable change by imports. According to them, mutton, beef and poultry prices would remain at their present high level and the possibility of further increase in their rates is not ruled out.

A further escalation is indeed on the cards because many breeders would start looking towards exports, particularly in Gulf and Middle East regions where mutton from Pakistan is rated high and regarded as more juicy and tasteful than imports from western countries, Australia and even India. Exports would place the country back at square one, if not a few paces behind the previous price position.

However, even if common consumers do not get relief, the policy of import of meat has potential for increasing exports and in that, it would be instrumental in proving a better deal to breeders. But consumers may be the losers due to inferior quality of imported meat.

Exactly how the livestock and poultry sectors would be affected would however depend on the volume of imports. If they flood the local market, Punjab’s breeders and poultry producers may be hit because building exports would take time. They would recover in time but initially, the policy would place them under pressure.

One of the serious problems the government has been confronting, particularly in its wheat procurement efforts, has been shortage of standard storage facilities. Government officials have become increasing conscious of the fact that existing warehouses are old and dilapidated and the quality of wheat stored in them is affected and losses are also caused by inadequate storage that cannot protect wheat from insects and birds, besides other loss inflicting factors.

This problem does not confront wheat alone and is to be seen in other crops as well. Officials have been mooting the possibility of building storage facilities that reduce losses and protect the quality of produce. While farm level storage has been discussed, it is unlikely that the next budget makes headway in that direction. However, construction of warehouses is expected to earn the attention of budget makers.

Private sector experts have been concerned for some time about the attention to and quality of research in the sector, specifically with regard to building new and higher yield seeds for various crops. The provincial government presides over a number of research organizations but they have been mostly sterile.

Some of them have been non-productive because of lack of funds; allocation are often just about sufficient to meet the salary bill of employees. Grants for research organizations is expected to be increased to make them productive and research for increasing yield of crops, particularly major crops that are either basic food for the population or major foreign exchange earners.

Another issue before the managers of provincial agriculture is availability of water. There is nothing they can do to increase water resources or expedite the building of new reservoirs- an idea they support all the way, but small dams can be built to store rain water. This year’s rains drove the point home that the administration must take up construction of mini dams on a priority basis and indications are that this would feature prominently in the government’s priorities in the budget for 2005-06.

The agriculture sector is vital for the province economically but the government has other concerns too. Local bodies elections are close and national and provincial polls not far away. Politicians of the ruling party, as also in the opposition, many of them from rural areas realize that their success would be linked with their standing in the farming community. As such, the main focus of the budget would be on the agriculture with a view to benefiting farmers who constitute the majority of the electorate. Whether the efforts strike the right chords is a question only the budget can settle.

 

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