The agriculture sector faces a funding shortfall in the 2024-2025 budget

LAHORE:

The savior of Pakistan’s economy for FY-24, the agriculture sector, has managed to attract only Rs 5 billion for the next financial year from the existing government.

In his budget speech on Wednesday, Finance Minister Muhammad Aurangzeb said agriculture is the main pillar of Pakistan’s economy, contributing 24% to GDP and 37.4% to employment generation. The country’s food security and manufacturing depend on this sector, which also has huge export potential.

The prime minister announced the Kissan package in 2022, which included a labeling and risk-sharing scheme for farm mechanization. “For the next financial year, Rs 5 billion has been allocated for this programme,” Aurangzeb said. He also said that this fund will provide financing for planters, tractors, threshers, combine harvesters and mobile grain dryers, which will help increase farm production.

According to the Economic Survey of Pakistan, the agricultural sector registered a strong growth of 6.25% during the 24th year with all major crops producing more than expected and registering an increase of 11.03%.

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However, the farming community still faces problems due to non-availability of overpriced material inputs and rising energy costs. They are not optimistic about next year, believing that many farmers may not be able to buy the necessary agricultural inputs to grow crops.

“The purchasing power of a farmer is at an all-time low. There are many factors behind this. How will they manage their finances to grow their next crop?” asked Pakistan Kissan Board Chairman Sardar Zafar Hussain Khan.

The farming community across Punjab is already facing significant losses on its wheat crop as the government is not buying it and prices in the open market have collapsed due to the inflow of excess wheat stocks.

“This year, the growth of agriculture was over 6%. Why is the government setting next year’s growth target at only 2%? They know that farmers will not be able to buy urea, pesticides, etc., which is likely to lead to low production in the next sowing seasons,” Khan said.

Unfortunately, farmers’ lobbies in Pakistan are not strong and more than 60% of public representatives in parliament do not care about what is happening to farmers. “There is a high possibility that Pakistan will face food security issues in the coming years if farmers’ problems are not resolved,” he added.

While there is widespread dismay over the federal government’s actions for the agriculture sector in the coming financial year, some industry stakeholders believe the federal government may now pass the onus to provincial governments to announce major agriculture budgets.

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Many believe that the current financial year’s funds for the agriculture sector were much higher when the same government, under the Pakistan Democratic Movement, increased the Kissan package amount from Rs 1800 billion to Rs 2250 billion. The previous government believed that through the package, about Rs 2000 billion had been transferred to the rural economy for further crop improvement.

However, this year’s lack of subsidy funds may lead to more problems for ordinary farmers in purchasing fertilizers, pesticides, etc. .

He said they had expected that to double agricultural production as per Prime Minister Shehbaz Sharif’s vision, the government would go the extra mile, but no measures were announced in the budget speech. “I think the federal government has completely handed agriculture over to the provinces, expecting them to announce it in their provincial budgets, despite the fact that electricity tariffs, fertilizers, seeds and pesticides are federal issues.”

As the head of the apex body on agriculture, Jawad added that he is disappointed that the government has ignored the agriculture sector in the federal budget, regardless of the recently launched Green Pakistan initiative.