Inflated agriculture budget

By Ahmad Fraz Khan

THE Punjab’s agriculture budget has turned out to be the way, it should not have been — a pack of contradictions, which are too glaring to be missed by even a naive farmer.

To begin with, the budgetary allocation of Rs5 billion is a contradiction in itself, given four years record of the present government. Ever since this government came into power in 2008, it has never spent the entire budgetary allocation on the sector.

Why it keeps increasing the figure every year, to be slashed later? It needs to explain. For example, it allocated Rs2.8 billion in 2007-08 but later revised it to a paltry Rs917 million — almost 75 per cut on original allocation for the sector.

Similarly, in 2008-9, it allocated Rs3 billion for the sector, but later reduced it down to Rs2.2 billion. Next year, the allocation was even higher at Rs3.2 billion as the reduction became much heavier with only Rs1.5 billion actually released — a drop of more than 50 per cent.

This year, it has set aside Rs5 billion — an increase of almost 146 per cent. Should farmers believe that it was sincere in spending it too? If it does spend the amount, it would actually be more than 300 per cent increase in spending over the last year.

The Punjab government needs to explain two things: what has increased its capacity to absorb that kind of money? Second, why it perfunctorily keeps increasing allocation figure when it does not intend to spend it?

Most of the budget would be under four heads — water conservation, bio-gas development, supply chain improvement and tractors subsidy. Of all four areas, water management makes the most interesting reading. The project of water courses lining is almost six-year old and the biggest of them all. Every year, allocations are made for lining of water courses without assessing what harm or benefit it has brought to the province. If it has saved, or restored — as claimed by the proponents of the project — where has that water gone. It needs to be studied.

To make the strategy even more questionable, cemented floors are being built to stop water seepage to the ground in a province where one million tube-wells are continuously pumping water out of soil. These tube-wells pump around 35 million acre feet water every year. Take it in the backdrop of 53maf supplies that the province draws from canals, the figure becomes
astonishing: Over 70 per cent of provincial supplies come from the soil.

On the one hand, the government is allowing these tube-wells to pump 35 million acre feet of water out of subsoil storage. And, on the other, it is allocating massive amounts to stop water seepage to replenish aquifer. Does anyone in official circles see the disconnect between both these policies? Or, does it seem to be a sustainable option?

There is yet another disconnect. For the last few years, the Punjab government has refused to pay its part of the subsidy bill on tube-wells. It has been doing so on the ground that these tube-wells are pumping massive amount of water and playing havoc with aquifer. It refused to listen to farmers and the federal government on the issue, and has not been paying money that has now gone beyond Rs5 billion. On the other, it has made allocations for subsidising conversion of tube-well on bio-gas. In its energy sector head, it has paid even more money to find solar solutions for the tube-wells.

These policy disconnects prove that different departments and wings of Punjab are working “completely independent of each other — without any coherent policy framework.” One department does not know what the others are doing, and each of them is only concentrating on its narrow mandate, without assessing the impact of its work on others. Punjab needs to have an integrated set of policies with an overall vision.

Another emerging counter-productive policy instrument is the tractor subsidy. Punjab has earmarked another Rs2 billion for subsidising tractors this year as well. For the last few years, the entire provincial focus has shifted to tractors — ignoring all other forms of machines. It is thus leading to use of tractors in fields, rather than mechanisation. The province already has around 400,000 tractors that make 0.6 horse-powers per acre — against 0.5hp average in other developing countries. But still, both federal and provincial governments are sticking to tractor subsidy for political reasons — trying to out do each other.

This policy has entered a stage that could be counter-productive now. Tractors are already sold on premier price, whereas subsidies normally make sense on machines that farmers do not buy, but are necessary for the health of the soil.

Without other machines that help in preliminary and primary tilling, ridging, sowing, inter-culture, harvesting, spraying etc, the use of tractors becomes grossly counter-productive: creating a hard pan and compacting soil. So, it is time for the Punjab government to branch out: promote other machines that take farmers towards mechanisation.

It is not meant here to belittle importance of these initiatives that make their own contributions to provincial economy and farmers wellbeing but only to suggest that they should compliment each other rather. Only by doing so, the provincial government would look in-charge of the sector, and planning for its betterment.


Courtesy: The DAWN