Agri Sector gets priority
by Khawaza Main Uddin

The government has this year plnned to increase the amount and coverage of farm subsidy to give direct support to the farmers, redefining agriculture as the backbone of the national economy.
An arnount of Tk 1,000 crore is likely to be allocated as subsidy for agricultural inputs in the coming budget as already agreed upon tacitly by the Ministry of Finance following strong recommendation from the Ministry of Agriculture.

The proposed cash support will cover newer sub-sectors other than seeds and locally manufactured urea fertilizer - for which the existing subsidy,is an indirect one the benefit of which hardly reaches the farmers' end.

The agriculture ministry has proposed to provide farm subsidy up to as much as 50 per cent of cost. Imported fertilizer, irrigation pumps, power tariff for the farm sector, agri-equipments, and research are likely to be the leading sub-sectors to be covered by the subsidy.

At the same time, allocation for agriculture beyond subsidy wopld also be raised, sources have said, adding that- farm subsidy is being given against the explicit and implicit pressures from bilateral and multilateral lenders.

However, the government has not yet found an effective mechanism to reach the cash support to the farmers at the grassroots level.

An inter-ministerial committee will suggest ways and means to do the job after Finance and Planning Minister M Saifur Rahman makes the budgetary allocations in this regard.

Agriculture Minister MK Anwar has said Bangladesh should provide up to $1 billion in farm subsidy within the "very permissible limit" of global trading regime.

The planned allocation of Tk 1,000 crore is only one-sixth of $1 billion (equivalent to Tk 6,000 crore) whereas any least developed country is allowed to provide subsidy amounting to 10 per cent of its agricultural gross domestic product according to rules of the World Trade Organisation.

Also, the government is yet to decide on a programme to provide support for agri-produces through directly buying the products to ensure fair and reasonable price for the growers in a market still dominated by middlemen.

Another element that is certain to be missing in the coming budget is crop insurance - which might be a compensatory measure for the farmers in the event of natural calamities.