Status quo approach in agri development   
By Ahmad Fraz Khan

June 06, 2011: IF the Pakistan Muslim League-Nawaz wants self-reliance, doing away with foreign aid and loans, it is natural for everyone to expect its next budget in Punjab — where the party rules — to reflect that commitment.

However, news emanating from the provincial finance department is hardly encouraging, at least from self-reliance perspective. It would be more of a status quo budget. According to its finance department officials, out of an stipulated Rs184 billion development budget, the agriculture sector would get Rs2 billion, livestock Rs1.5 billion and irrigation Rs11.8 billion.

The total allocation for the entire sector would thus be just over Rs15 billion – eight per cent of the development budget. There is no big project; all the money will be spent on some minor water efficiency projects, which are already under way and needed cash to get completed.

To make the matter worse, the finance department is warning all others to expect cuts on their development allocations as well later on. According to them, the Punjab government would make healthy allocations to keep the budget politically viable. But, drastic cuts, as it applied this year, are a distinct possibility because of likely overspendings on non-development, like huge subsidy packages.

The farmer bodies and agriculture business houses were expecting some revolutionary steps, especially after the PML-N raising the slogan of self-reliance. This requires huge investment in agriculture. All of them agree that if anyone — federation or Punjab — wants to go for self-reliance, the only sector that can ensure it in short and long-term is agriculture, including its sub-sectors like livestock and horticulture.

Punjab, they maintain, is nothing but agriculture. How one can expect self-reliance with agriculture stagnated (with little development spending), where it has been for the last many years, they wonder.

They believe that if Punjab has to opt for self-reliance, and lead the country in the same direction, it has to revolutionise its agriculture. As a first step, it must start concentrating on per acre yield, rather than just take consolation in total production figures of any crop. It is time to increase per acre yield, and spare land for other high-value crops.

The Chinese model can be replicated here, which has set a target of 100 maunds per acre production target for every crop, be it wheat, rice or cotton. If Pakistan cannot leapfrog its targets to the Chinese level in one go, it must start journey on that route.

To begin with, there is no reason why it cannot increase its wheat production from current average of 28 maunds to 40 or 45 maunds per acre. There are some farmers who are producing 75 to 80 maunds per acre. If wheat average jumps by 30 per cent, it means that 30 per cent land could be spared for other crops or 30 per cent surplus could be exported every year.

Similarly, cotton is another option that can shore up the economy. There are some farms, run by private seed companies, where per acre yield has gone up to 80 maunds per acre. These farms exist in Punjab, with demonstrable technology and practices. Why the Punjab government cannot get a clue from them and spread the technology and practices to other areas.

The only thing it needs is money, which should come in the form of budgetary allocation and official commitments. At present, its per acre yield is stuck at 19 maunds per acre. If Punjab adds five million bales in its production, it would ge direct and indirect benefit of over $5 billion. This is achievable.

Scientists believe that Pakistan can raise its production to 20 million bales within a span of two to three years with right kind of practices, provided it spares money and manpower for the purpose.

If Pakistan can deal successfully with five major crops – wheat, rice, cotton, cane and maize – it would be jumping to self-reliance within a span of few years. All these targets are achievable because the world has already done it and a few farmers in Pakistan are doing it. Unfortunately, no such initiative seems to be part of the provincial budget.

On one hand, Punjab needs to concentrate on per acre yield, and on the other, it must find market abroad for the produce. The big business houses believe that if Punjab achieves a certain level of production and has a sustainable surplus, the private sector itself would find foreign markets. The problem is sustainable production, they insist.

In order to make its exports more profitable, Punjab must invest in value addition. There is hardly 15 per cent value addition in the country against over 50 per cent in India and 80 per cent in developed world. That is where the province needs to invest rather than going after politically driven sasti roti (low priced bread) and subsidy packages.

Had Punjab invested around Rs35 billion, which it lost to unspecified subsidies last year, in value addition, it could have made a difference in the life of people. But it did not, and it is still not ready to do it if the next budgetary allocations are something to go by.

If Punjab can somehow add one litter of milk to its production, which is a matter of simple management practice of which the farmers are aware, it can add Rs22 billion to the rural economy. It shows the magnitude of huge potential in the sector which remains untapped because of paucity of money, technology and political commitment.

Budget is the time to show it, but the PML-N government in Punjab seems to be failing in that despite political sloganeering to the contrary.