Heads I win, tails you lose! The game cannot get crueller and more self-defeating; a tragedy most Pakistanis have adapted as fait accompli. With the ghost of COVID-19 haunting every house, old habits still prevail. This means laissez faire or business as usual.
Cognisant that the health, political and economic impacts of COVID-19 are still a mystery for the world’s best-known virologists, research organisations and economic planners, a better strategy was needed for a cash-starved Pakistan for ingenious solutions. This means national sustainability through stirring indigenous potential towards food security with a direct effect on employment in farms and allied industries. The issue needs immediate attention.
According to Felix Anderl of the University of Cambridge, ‘COVID -19 and agriculture: the coming contradictory hunger pandemic’, “To conceptualise agriculture as a way of catering to the needs of the many, while protecting what is left of nature, will be a major task for all future politics”. I agree that although lot has been written on the effects of COVID -19 from health to global recession in terms of negative growth, it is definitely on the way to causing a global hunger pandemic, “with the poor, notably the urban poor, people living in remote areas, migrant and informal sector workers, people in humanitarian crises and conflict areas, and other vulnerable groups likely to face the worst consequences”. Pakistan’s suppressed agriculture potential needs policy and implementation changes to come alive and kicking. Pakistan is missing a Godsent opportunity of becoming a global bread basket.
The ECC’s approval of Rs50 billion for the agriculture sector is a routine measure and not a reform-oriented decision that boosts the quantity and quality of farm outputs. Just analyse who would benefit?
Reportedly, the approval by ECC is meant to provide farmers (doubtful) subsidy on fertilisers, reduction in bank mark-up on agriculture loans, subsidy on cotton seed, white fly pesticides, sales tax subsidy on locally manufactured tractors as part of a package of Rs100 billion earmarked for farmers and small and medium enterprises (SME) out of the Rs1200 billion coronavirus relief package. The finance minister linked the package to the Rs50 billion package for indirect cash flow support to nearly 3.5 million through prepaid electricity. Rs37 billion would go to the fertiliser sector, Rs8.8 billion to loans, Rs2.3 billion to cotton seed and Rs6 billion to white fly pesticides. This is the end of the story.
This is an oft repeated and failed recipe for the past three decades and the only reason why farm outputs in quality and quantity declined, exports plummeted and poverty increased. A glance at Pakistan’s agriculture decline in 30 years is directly proportional to such subsidies. The question is why so?
Policy planners at all levels in Pakistan have concentrated on providing relief to fertiliser, cottonseed and agro-chemical industries, the benefits of which have never trickled down to farmers with small land holdings. Powerful elites are entrenched with these planners and they stand to lose the easy subsidies they get through a flawed system.
In the backdrop of the recent sugar report, the least that could have been done was to revisit the entire mechanics of agriculture, identified loopholes and taken remedial actions. It seems no one took this report seriously, a reason why I termed it the ‘sugar bubble’. There was no critical appraisal and unfriendly policies were lumped in the guise of corona relief.
Below are the reasons why I call this package retrogressive.
A majority of farmers in Punjab and Sindh are hostage to middlemen and feudalism. Their economics are mostly based on crop to crop tenures through middlemen. Input costs are traded at exorbitant profits in which subsidies have no effect. Outputs are purchased at costs determined by these middlemen subtracting the loans. A small farmer is beneficiary at the subsistence level. The subsidies benefit the middlemen and downstream industries.
With all the resources at its disposal, it would not be a bad idea to ascertain who takes loans on agriculture? Small farmers do not have the capacity to open bank accounts and draw loans. Invariably, it will be farm holders who own large tracts of land, have government lands through direct and indirect lease, rip off lands from small farmers and use them as slaves and own industries like sugar, cotton, solvent plants, oil, dairies, livestock and energy. Much of these findings can be found in the recent sugar inquiry and also in the IPP investigation. This mafia are the beneficiaries of such loans and subsidy policies. Farmer’s poverty will accentuate and result in a food shortage pandemic.
In a discussion with Dr Talat Anwar, it transpired that in 2014, the 40kg wheat support price was Rs1300 whilst the dollar parity was 98.55. This year, the government has set the wheat support price at 1400 with dollar parity at 159.6, a devaluation of Rs61. The highly inflated cost of production (indiscriminate utility of fertiliser, water and agro chemicals and expensive seeds) in Punjab was estimated at 1349.57 by the Agricultural Policy Institute for 2019-20. This means that small farmers would only earn Rs50 per 40kg bag implying Rs1250 per acre on an estimated 1,000 kg yield. A farmer with 5 acres will earn Rs6,250 from a six-month crop like wheat; a paltry earning of Rs1,000 per month.
In contrast, mid-level farmers, who do not rely on middlemen are earning Rs1,400 per 40kg with a 30kg yield amounting to Rs35,000 per acre. As the size of land holdings increase so does the profit margin. Factorise the fact into who controls the seeds and input industry; the inevitable conclusion is an exploitative and unfriendly policy for farmers.
Where have Pakistan’s agriculture scientists and research institutes gone? What reforms have they brought in the past three decades to harmonise nature? What have they done to reduce farm inputs? Here are some facts.
There has been no substantial research. Most play second fiddle to GM and BT seeds provided by multinationals. Therefore, research if any, is sponsored while objective research is discouraged and jettisoned. These seeds and allied inputs are environmentally damaging and degrading environment rapidly. Artificial fertilisers and agro chemicals increase farm inputs exponentially. Research organisations have done nothing to reduce these expensive inputs.
Pakistan is the highest consumer of fertiliser and agro chemicals per acre in the world. To the contrary, Pakistan’s river fed lands have enough nutrients to minimise the risk of fertilisers. These are a post-world war product that diversified explosives of military industrial complexes. Indiscriminate use is destroying soil nutrients and microbes that provide natural fertiliser. Not only in Pakistan, but the world over farmlands are destroyed and gradually, natural farming is becoming the norm.
Subsidies if any, need to go directly to the small land holding farmer. The government has the data through the land and irrigation revenue systems. All it needs is computer software and every farmer along with his agriculture yields is identified. What stops the policy planners from doing it?
In addition, there is no ploughing of fields, As a result, soil carbon dioxide is not released, which results in global warming, subsoil anaerobic bacteria flourishes to produce nutrients and ecological balance is maintained.
Lastly, the cost of exporting normal wheat is $200 per 1,000kg. Wheat grown through natural process and duly certified is $600 per 1,000kg. Imagine if Pakistan has surplus in high quality high quantity grains and exports. Cotton, rice, maize, millet and alfalfa are some indigenous crops that have export potential besides meeting local demand. Two years of this and Pakistan would be out of the woods.