The government has decided to pay fertiliser subsidy directly to farmers through the Ministry of National Food Security and provincial governments in an effort to reduce prices, which have skyrocketed and led to less-than-required consumption.

Di-ammonium phosphate (DAP) prices have crossed Rs10,000 per bag, dealing a major blow to the farmers.

In order to end the manipulation of market by fertiliser dealers, who were allegedly involved in black-marketing and profiteering, the government has decided to register them.

The previous government had also urged the fertiliser industry to blacklist the dealers involved in black-marketing.

Seeking to address the issues pertaining to fertiliser supply during the current Kharif sowing season, the Fertiliser Review Committee met under the chairmanship of Federal Minister for Industries and Production Makhdoom Syed Murtaza Mahmud on Wednesday.

At the onset of deliberations, the agricultural departments revealed that there was a 14% decline in DAP offtake in the last sowing season due to high prices, which meant crops received lower application of the phosphate component of fertiliser, affecting the output badly.

The committee was told that there was a dire need to provide balanced nutrients for preparing the soil for crops and higher grain production.

Considering the price difference between urea and DAP, the industries minister said that the government had decided to make subsidy payments directly to the farmers immediately through the Ministry of National Food Security and provincial governments, so that DAP prices could be reduced.

“This step will also ensure balanced application of nitrogen and phosphate-based fertiliser to the soil,” he said.

The minister emphasised that the government would discourage the “compulsive purchase of DAP by the farmers along with urea”.

The committee discussed the domestic production and demand for fertiliser as well as prices, subsidy plan and fertiliser tracking and verification mechanism for the Kharif season in the backdrop of prime minister’s meeting on fertiliser.

In Tuesday’s huddle, the premier approved various policy measures to ensure the availability of fertiliser at affordable prices to the farmers during the Kharif season.

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The committee noted that the unregistered fertiliser dealers would be brought under the verification mechanism and it had been made necessary for the dealers to get registered with the respective provincial departments to ensure smooth supply of fertiliser at the district level.

The fertiliser manufacturers assured the government that the dealers would be registered with the relevant provincial departments.

In order to curb hoarding and smuggling, the government has decided to set up a task force under the Ministry of Interior and consisting of law enforcement agencies, the Federal Board of Revenue and provincial departments to thwart illegal cross-border movement of urea.

The minister said that the government had geared up to implement the vehicle registration, tracking and verification system to ensure adequate and timely supply of key soil nutrients to the farmers during the Kharif season.

Commenting on the recent urea price hike, the minister remarked that the government would not tolerate the unjustified increase in urea prices.

He added that the government was reverting the urea price to the old level of Rs1,768 per bag to provide relief to the farmers. “Any justified increase in price will be notified by the government later on after consulting with the industry,” he said.

The minister assured the industry that the government would address the issues pertaining to the outstanding payments of industry.

“The government has restored gas supply to the fertiliser plants as per agreement and they will continue to receive uninterrupted gas supply for domestic production to support the farmers and the agriculture base of the country.”

Meeting participants included representatives of the fertiliser manufacturing industry, dealers, Punjab chief secretary and secretaries of provincial agricultural departments.

Federal Secretary for Industries and Production Jawwad Rafique Malik and senior officials of the ministry attended the meeting.


Published in The Express Tribune, May 12th, 2022.

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