Restoration of fertilizer subsidy

IN a welcome move, Prime Minister Nawaz Sharif, on Friday, restored subsidy on fertilizers in a bid to facilitating farmers to achieve bumper crops for accelerated GDP growth. He took the decision at the instance of Punjab Chief Minister Mian Shahbaz Sharif who asked him to restore the subsidy as it would benefit 22 million farmers, as their production cost would be cut down by eight percent.
Agriculture is the backbone of the country and apart from meeting domestic requirements; the sector is also fetching most of the foreign exchange that Pakistan earns. A few days back, the Government provided a hefty package to the industry – mainly textile sector – which depends largely on agriculture. Experts say if proper and adequate subsidies are provided to agriculture, the sector has the potential to address most of the economic and financial woes of the country. There is dire need to bring down the cost of inputs, which have pushed the prices of agricultural commodities to a level where they have become non-competitive in the international market. Take examples of wheat and sugar, their prices are much lower in the world market as compared to those in Pakistan and instead of providing subsidy to farmers, the Government has resorted to clamping extraordinary import duties on these items to deny benefit to the common man. We have been emphasizing in these columns that instead of raising procurement prices time and again and that too alarmingly, the Government should subsidize agricultural machinery, fertilizer, seed and pesticides to help bring down the cost of production. The decision of the Government to restore fertilizer subsidy has also deprived the opposition of the propaganda campaign that it had unleashed during the last few days.

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