Fertiliser subsidy: Sindh and K-P remain stingy in contribution

Despite assurances, both provinces have failed to make deposit in SBP account

ISLAMABAD: Provincial governments of Khyber-Pakthunkhwa (K-P) and Sindh are adopting a stingy approach in contributing their share of the fertiliser subsidy pool, a situation much like last year’s, putting in doubt the government’s plan to support the agriculture sector.

Plan to support farmers came strongly from Finance Minister Ishaq Dar who said the country’s economic growth was pegged back by contraction in the agriculture sector. He announced measures to support the sector during his budget speech in June this year.

However, despite committing with the federal government, both provinces have not taken any concrete steps to contribute their share for the subsidy, said officials familiar with the matter. They have failed in depositing their shares in the consolidated account opened in the State Bank of Pakistan (SBP) for this purpose.

Pertaining to this, a meeting was held Thursday in the Ministry of National Food Security and Research, which was attended by officials from ministries concerned, Federal Board of Revenue (FBR), SBP and representative from the fertiliser importing companies, to resolve the subsidy issue between the federal government and provinces as well as with the importing companies.



The meeting was informed that the federal government has recently deposited Rs3.45 billion, an amount which is 50% of its own share and 25% of the total subsidy amount for importing DAP fertiliser.

The federal government informed the meeting that the remaining amount of Rs3.45 billion will be deposited in the coming week. Punjab told the meeting that it has deposited Rs1.19 billion in the account and intended that the remaining share will be deposited on a monthly basis.

The representative of the Balochistan government assured that it will soon contribute its share as it did in the previous year. However, it has a very nominal consumption of DAP fertiliser and its contribution therefore is minute accordingly.

Sources, however, revealed that both Sindh and K-P were unclear over their contribution as both of them failed to give any assurance in this regard, saying that they have put the summaries to their respective chief ministers, who are yet to take any decision.

“This is the same response they gave to the federal government last year and ultimately failed to provide their due shares,” said one officer.

The officer said that incumbent Sindh Chief Minister Syed Murad Ali Shah as finance minister had himself committed that his province will contribute the subsidy amount, but no practical step has been taken as yet.

The officer said that following Punjab, Sindh is the largest consumer of DAP fertiliser during Rabi and Kharif crops, but it avoids contributing its share.

The Punjab Agriculture Minister had also written a letter to the federal finance minister, last month, urging him to expedite framing a mechanism for processing of the importers claims for the subsidy amount, which is still unaddressed.

Additionally, Punjab also expressed dismay over the two provinces not contributing their due share and urged the federal government to ensure their contribution.

Published in The Express Tribune, October 8^th, 2016.

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