Farmers suffer despite bumper crops

Absence of wheat procurement in Punjab, high costs put strain on agriculture

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LAHORE:

Pakistan's agriculture sector has apparently missed an opportunity to shift benefits of bumper crops, especially wheat, on to average farmer. Though the federal and provincial governments are declaring year 2024 as a success, the real stakeholders seem to be unhappy with the way authorities have managed the affairs in this critical sector.

In the last fiscal year, ie 2023-24, the agriculture sector grew 6.25%, providing a significant support for the country's overall economy. Nearly all major crops saw an increase in production with wheat surpassing the estimated target. Wheat harvest stood at 31.4 million tons as compared to 28.2 million tons in the previous year. Being a staple crop, wheat holds a 9% share in agriculture and has 2.2% contribution to Pakistan's gross domestic product (GDP).

Similarly, rice output surged 34.8% to 9.9 million tons in FY24 from 7.3 million tons a year earlier. For cotton crop, there was a surprising growth of 13.1% in cultivation, which translated into a whopping 108.2% increase in harvest that reached 10.2 million bales.

Sugarcane production, however, decreased 0.4% to 87.6 million tons in FY24 against the output of 88 million tons in the previous year.

These figures seem promising, especially for a country having more than 60% rural population, but some key decisions, especially by the Punjab government, have turned the situation bad for farmers, who were initially celebrating the bumper harvests. The government had announced a minimum support price of Rs3,900 per 40 kg of wheat, however, the Punjab government, under an agreement with the World Bank, did not purchase the commodity, leaving farmers at the mercy of open market forces.

"The open market was not paying the minimum support price and if we consider a price lower by at least Rs100 per 40 kg, which was offered to farmers, then one can easily guess how much money growers have lost," remarked Pakistan Kissan Ittehad President Khalid Mahmood Khokhar.

He elaborated that wheat was like an engine for farmers; if they got the best price, then it had a positive effect on other crops too.

"In FY24, wheat farmers got the minimum support price of Rs3,900 per 40 kg, which resulted in a staggering growth of 6.25%. This year, I believe wheat crop will see a setback, triggering a negative growth in the overall agriculture sector," Khokhar warned.

To offset the side effects of withdrawing from the wheat market, the Punjab government has announced several initiatives. An example in this regard is Kissan Card, through which the provincial government is looking to provide subsidised seeds, fertilisers and other inputs.

While the federal government has allocated only Rs5 billion for the agriculture sector in current financial year 2024-25, the Punjab government has earmarked Rs64.6 billion.

The Kissan Card programme involves interest-free loans for 500,000 farmers with a maximum loan amount of Rs150,000, or Rs30,000 per acre. Total amount allocated for this year is Rs9 billion.

Under the Green Tractor scheme, Rs30 billion will be distributed among farmers for tractor purchase with easy instalments. The other key initiative is solarisation of tube wells, for which Rs9 billion has been set aside to shift 7,000 tube wells to solar technology.

The results of these initiatives have yet to emerge; however, they have produced positive vibes across all stakeholders. "We welcome such initiatives, but their scope should be widened and it must not cater to only 3-4% of the farming community," argued Rizwan Malik, a medium-scale farmer from South Punjab. In the previous year, crop yields improved, but costs of inputs like seeds, electricity, urea, diesel and labour also increased. This, coupled with the scrapping of wheat purchase campaign, ruined the business of farmers, he added.

"A friend of mine in Sindh managed to harvest a good sugarcane crop, but he is struggling to fetch fair payments from sugar mills and that too on time," he revealed.

"Water scarcity is another challenge for an average farmer. The government should focus on revamping the entire process, starting from purchasing farm inputs to selling crops in markets; this needs a lot of hard work with commitment," Malik added.

Private sector agricultural experts said that the federal government should play the role of a coordinator to fix issues in association with the provincial governments.

They cautioned that consistency was the key as Pakistan could not prosper and address its existing challenges in order to move towards modern agriculture, if secretaries and other important persons in key organisations were changed frequently. Already, the country's production is decreasing while the population is increasing. "Pakistan is facing a population explosion; we have more mouths to feed than our total production," remarked Pakistan Agricultural Research Council former chairman Yusuf Zafar.

He added that the agriculture sector must achieve a consistent growth of over 6% every year, which was the only way to have surplus crops, "else we will have to import different commodities again and again". Political will among all stakeholders is a must to meet this target and remove bottlenecks.

"We have a good rice crop this year and our export revenues through this commodity have nearly doubled in the past one year," he said. However, in early December, the European Union intercepted about 77 consignments to check the presence of fungus and other pests, which required the owners of the consignments to pay damages. "Such things need to be fixed," Zafar said.

At present, there is a wave of uncertainty among the employees of federal institutions as the government has announced a restructuring and rightsizing drive, under which key departments will be wound up or merged with other entities.

"Everybody is worried and is looking for survival; how can key departments related to agriculture, research, etc work in such circumstances. There is a need to end this wave of uncertainty, so departments may initiate work, otherwise things in the agriculture sector will get worse and put farmers in a vulnerable situation," Zafar added.