Neglect of farm sector ( for economy and rural poverty reduction)-DAWN

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PUNJAB’S Kissan Card scheme is a good initiative that will help farmers, especially smallholders, directly access government subsidies for procuring seeds, fertilisers and pesticides from registered dealers. Launching this scheme in Bahawalpur last week, Prime Minister Imran Khan described the introduction of the Kissan Card as a “turning point” in the country’s history. He also hinted at extending the initiative to other parts of the country being ruled by his PTI. It is not yet known if and when the government intends to extend the scope of the scheme to give farmers’ access to short-term collateral-free, cheaper or subsidised bank loans. Expanding the scheme’s scope will help smallholders immensely in covering the cost of cultivation, purchase of equipment, post-harvest expenses etc. It will also rid them of loan sharks who charge exorbitant rates on the loans given to farmers. Further, the extended scope can be used to provide insurance to cover crop damage sustained during natural disasters or adverse climatic impact, as well as against death or permanent disability of the cardholder. Policymakers should already be thinking along these lines. Agriculture provides livelihood to two-thirds of Pakistanis and employs 39pc of the total national labour force. Additionally, the agriculture sector, which constitutes almost a fifth of the economy, directly or indirectly, fetches almost three-quarters of the export revenue by contributing to the export of textiles, leather, rice etc. Its significance for our food security cannot be overstated either.

Nevertheless, this sector has been a picture of neglect for decades, resulting in low productivity and increased rural poverty. Sadly, initiatives introduced by successive governments to improve productivity have mostly focused on farm subsidies. No serious efforts have been made to tackle long-term issues such as deterioration in seed quality, wasteful on-farm water management, loss of soil fertility, low levels of mechanisation, farm fragmentation, unavailability of credit etc. The consequences of such policy neglect are now becoming more pronounced as falling farm productivity is forcing the government to substantially increase its food and industrial raw material imports at the expense of external-sector stability. Farm subsidies are vital to help reduce the input costs but these are not enough. Nor are these desirable for a longer period. The better way of improving crop yields and farm incomes is to address the long-standing issues afflicting the agriculture sector. The sooner we focus on these issues the better for the rural poor and the economy.

Published in Dawn, August 17th, 2021