Student, University of Agriculture Faisalabad
Agriculture sector plays a vital role in the economic development of any country. It is also a major source of raw materials to many industries such as cotton, sugar, tobacco and edible oil as well as non-edible oils. In short, agriculture helps us to meet our needs and the needs of millions people in the world. Pakistan is also an important agriculture country as its 75% population lives in rural areas and about 40% people are engaged in farming. No doughty, Agriculture sector of Pakistan is the largest component of GDP of Pakistan. Its contribution is about 25% to Pakistan’s GDP.
The Most important component of Agriculture’s sector is the farmer who feeds, millions of people, all with his efforts by growing different crops and donating all of his time , energy and money. He works the whole season for cultivation and maintenance of a single crop. Small and marginal farmers meet their day-to-day needs from commission agents and are compelled to sell even their subsistence produce under stress. We are well aware about the financial conditions of our framers. At the end of a crop season, they have to pick their horse, (either to cultivate next crop or to fulfill their children’s needs, with this little money)with the little money which they gained from previous crop can either be used to cultivate next crop or with this money they can fulfill the needs of their children’s.
Middle man scenario in Pakistan
In rural economy, the farmer uses land and his labor power and the middleman provides money to facilitate production. Without middleman’s credit, over 80 per cent farmers would not be able to buy seed and fertilizer. They will not even be able to prepare their fields for sowing if the middleman does not provide money for the diesel. That is how ground realities define the role of the middleman and make him an essential part of the crop cycle.
Why Small holders sell through middlemen:
Social ties are weak between farmers and wholesalers who directly buy from these farmers. This situation Is favorable for middle man because he has the real approach to farmers in small villages and have strong social ties with the small farmers. Similarly the large majority of farmers participating in the middlemen channel had strong ethnic and/or religious ties with those middlemen.
The farmers listen to middle man more than the extension workers who can only advise without any financial clout while the small farmers need financial support for the sowing of their next crop. Farmers do not show any interest in the new technology and in a new variety recommend by the government without any financial support. That’s why the middle man has strong advising position in the small farmers. He also have strong position of selling desirable products like fertilizers and seeds. The presence of any form of quality uncertainty in trade may also encourage farmers to use middlemen.
How middle man get benefits:
The middle man (Ardhti) get benefits from farmer’s helpless by providing them with seeds and fertilizers free of cost and make sure that in returns they shall sold him all their crop productions to middle man. At the end, this monopolist group of the society snatches all the production of the poor framers with very low rates. So, it is the middleman who makes the decision about crop prices when he purchases them from farmers and when he sells it to the next buyer. The market is ruled by middlemen rather than farmers. There are no rules and regulations at village level to stop this group from monopoly. Who is responsible for all this? Who will stop it?
Why the Need to cut of middle man
- Practice of black marketing:
Middle man creates the artificial demand for the products in the market by breaking the continuous supply of grains between farmer and industry. Middle man store the huge amount of grains to ultimately creates the artificial shortage of a specific product in the market.
- Duplicate products:
Middle man use duplicate products of seeds, fertilizers and pesticide for illiterate farmers. The farmers totally relay on the middle and accept all the products of middle man with open arms.
- N0 Faithfulness:
As a connecting link between the producer and the consumer, the middleman is supposed to be faithful to both. He has to convey the suggestions and complaints of the consumers to the producers and also pass on any useful information, conveyed by the producers, to the consumers. Not many middlemen faithfully carry out such duties. Most of the middle men are not good, not ethical and get syndicated to cheat farmers to any level for their own money making.
- Selling expired goods:
A huge amount of expired products has been solid to small farmers without any rule and regulation.
How can Government help the small farmers?
If our farmers are not stable financially, they can never contribute in the race of better yield from crops and the use of modern techniques is not feasible. We have to support our farmers to improve the per acre yield and to feed the fast growing population of our country. For this Government should take some important steps
- Purity of products:
Government should make it easy and accessible the availability of pure seed, fertilizer and pesticides for framers even at village level. Govt. can make it possible in collaboration with Zara Taraqiyati banks. In every union council government should establish branches and desks of this bank which provide farmers with all the sources (such as seed, fertilizers and pesticides) in a form of loan with a single thumb verification of their land, which is online now days.
- Modification In Purchasing system:
And at the end of each crop season government must be bound to purchase the crop production of every farmer’s crop with considerable rates announced by the govt. All the system must be very transparent and free from middle man. All the data of loan and the purchasing system of crops should be online. Every individual farmer can check the rates of all things which he gets as a loan and also the money he received at the end of all procedure from the bank branch. If government can take this step then the race of our Agriculture sector will be remarkable.
- Price fixing must at the start of season.
The announcement of wheat price in March when the crop is near harvesting, hardly works as an incentive. It is, therefore, necessary that the support price be announced for all the kharif crops in the month of January and for Rabi crops in August.
- Cash security:
Farmers really need the cash money of its yield for the sowing of next crop and for his children’s. .Cash delivery in time can develop good link between farmers and government.
- Implementation of existing policy.
Punjab started this anti-middleman campaign way back in 2000 when the country Since then, Punjab has done everything administratively possible, even involving the State Bank of Pakistan to restrict commodity finance, to throw the middleman out, but failed. With Modifications in this campaign government can throw back the middle man from our agriculture system.