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Agri Overview 

Wheat economics and poverty   
By Mohammad Tariq Janjua

Poverty figures short of the semantics reveal a gruesome picture. The Economic Survey mentions that there are 32 per cent poor in Pakistan. While the poor are 22 per cent in the urban, and 39 per cent in the rural areas.

Wheat economics and poverty The difference could be attributed to the policies and interventions which have pitched the terms against the agricultural sector.

Economic reforms and deregulation have left each to the vicissitudes of market forces sans mercy. Farmers have to buy all inputs at market prices, be fertilizer, pesticides or machinery as all subsides have been withdrawn by the government or are in the process of withdrawal.

Traders add to the burden through manifold manipulations. Not even a small finger is raised to protect the weak farmer against the financially powerful trader and 'arhties'.

To the contrary the trade of agricultural produce is hemmed in by price and non-price barriers. While the poor farmers in the rich OECD countries get direct support of the US $300 billion every year, the poor farmer in Pakistan has to provide succour and support to the industries and the urban population through low-priced agricultural produce and cheap food.

It is not the rich but the poor from the agricultural sector who carry the albatross of food security on their emaciated bodies and have done so for the last 57 years of our independent existence.

One glaring manifestation of the injustice is witnessed in the implementation of the Wheat Support Price Policy. For several years the open market price of wheat has been lower than the support price at harvest time. Yet the government was deliberately slow and measly in buying wheat to support the farmer. The poor farmer unable to hold or hoard, was selling short.

Comes 2004, a rarity, when open market prices were higher than the support price. But this time the Punjab government compelled the farmer to sell wheat to the government at Rs350 for 40kg.

Shafi Niaz calculates that the farmers of Punjab were made to lose Rs2,625 million on compulsory procurement of 3.5 million tons of wheat @ Rs 30per 40kg. This is a conservative estimate considering that the open market price was Rs400 and the loss to the wheat growers only in Punjab is actually more, around Rs4.5 billion.

Transfer of resources has been a regular feature in the past as in the case of compulsory procurement of Basmati for exports. One could list such instances ad nauseum.

In the last few years the farmers suffered because the governments did not procure when the farmer was seen to sell to the government at the support price and this year the government has discriminated by compulsory procurement. In either case the spirit and objectives of the support price was violated.

The people of Pakistan are reaping the harvest of half a century of such policies in the shape of rampant poverty and despair. This 14th of August came in the midst of too many grim and gloomy dings. Next morning the nation woke up to more sad news.

Some 18 young men single-wheeling on motor-cycles, order into the valley of death. And two girls lost their nerves and surrendered to death at an age when youth flowers and the entire Universe is so beautiful.

Why had these two young girls to take their lives? Perhaps life had become an endless drudgery and they could face poverty no more. Their deaths were neither noticed nor lamented nor even an elegy written.

Any society with a semblance of conscience or compassion would have moaned and groaned and even wept and cried for deaths so young. But not a ripple was caused in the egocentric, callous, heartless society which is mine and yours in this Land of Pure.

The civil society and the liberal conscience which produce voluminous literature on humanitarian issues and articulate their sentimentalities on poverty could not be stirred out of post-buffet lunch slumber.

Our heart goes out to the poor parents of the girls who died so young. May be it was our cruelty and lack of concern which pushed them to death. They were so poor that they could not live. These girls lived and died in the heart of the agrarian Punjab.

The same area which has produced food for all. Pakistanis could not give food to its own daughters. These girls are no more, mere digits in the statistics and their deaths will have no impact on the number of poor, be it 40 per cent of the populace (or 32 per cent by government reckoning).

We do not dispute the substantial amount of over Rs200 billion earmarked for poverty alleviation by the government in the highest ever PSDF and the Federal Budget. We are even willing to believe that there will be a miracle and implementation will be without pilferage or wastage.

With the highest growth rate in recent past, with all positive macro indicators, how come there is an unending addition to some 50 million poor. We had claimed that no Pakistani goes to sleep on empty stomach. Alas, no more. We have touched yet another depth of abysmal despondency and hopelessness.

Time to ponder and reflect: Is there any impact of the massive dosage of funds or is there none? The bitter truth is that the Poverty Reduction Strategy is not working, reducing poverty by giving alms to the poor, will take us nowhere. Let us feel the tremors before the debris comes falling down on us.

Bereft of the provincial/parochial angles, the fact of the matter is that poor farmers have been the target of adverse returns enforced by the government. It was a providential opportunity in 2004 to reduce poverty in the rural poor by allowing them market returns on their produce. The opportunity has been missed by the government.

The prime minister should now commit and endeavour to make up to the farmer for the past be it wheat, rice or sugarcane grower. Let Mr Shaukat Aziz reach out to the poor and be remembered for his empathy with the poor.

No amount of doles or fancy policy paradigms will alter the misery of the down-trodden. Only farmer-friendly policies ensuring reasonable returns for their sweat and their produce can reduce poverty and curb urbanization.

The decision should be made now and before wheat sowing starts. The government should be gracious, nay generous, in fixing the support price for next wheat crop, as it has been to the car manufacturers, and should go beyond what Agricultural Prices Commission has recommended because the Commission has been far too conservative all these years.

In the past whenever the government was liberal in fixing the support price, the agricultural sector has responded by giving high growth. Otherwise it is que-sera sera for the poor and on to the next donor-funded workshop on poverty in a five-star hotel for the assembly of enlightened communicators. 


Courtesy: The DAWN

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