ISLAMABAD: Prime Minister Shahbaz Sharif on Monday unveiled a Kissan Package for farmers to assist them recover from the devastation of the floods.
According to the prime minister, Pakistan’s progress is closely correlated with the growth of its agriculture industry.
According to the premier, the government would give farmers loans totaling Rs. 1,800 billion in the current fiscal year, which is four times more than it did the year before.
Kissan Package announced by PM Shahbaz Sharif
PM Shehbaz noted that the commercial banks avoid lending to small farmers and businesspeople in favour of safe investments, saying, “As you all know, the existing finance minister [Ishaq Dar] is fairly tough […] and he will ensure that all the funds is handed to the farmers.”
According to the PM, the government has earmarked about Rs11 billion to eliminate the markup on loans taken out by farmers who live in flood-affected areas.
He added that the government would also give loans worth Rs50 billion to young people living in rural regions who want to become professional farmers. The Center and smaller provinces will also give more than Rs8 billion to small farmers in flood-affected areas, he said.
He said that the government will set aside almost Rs6.5 billion for this project and that loans to young people would be offered at a markup lower than the market rate.
For the purpose of reviving the agricultural sector in flood-devastated areas, a package has been devised by the Ministries of Finance and Food Security.
The package includes actions like lowering fertiliser costs and ensuring that there is enough urea available. This package also includes starting the solarization of tube wells and paying electricity bills in instalments.
In areas affected by flooding, the prime minister promised interest-free loans for tenant farmers. PM Shehbaz insisted that a Rs. 5 billion subsidy had been set aside for these loans.
In addition, the government raised the Produce Index Unit (PIU) value for getting loans for agricultural purposes from Rs4,000 to Rs10,000.
He insisted that they would support small and medium-sized businesses (SMEs) in the agricultural industry since Rs. 10 billion had been set aside for a programme to modernise SMEs in the sector.
The premier bemoaned the fact that tractors made domestically in Pakistan cannot be exported due to the restriction, which has driven up the price of tractors for small-scale farmers.
The government has chosen to import used tractors because, according to PM Shehbaz, “I tried to terminate the monopoly of the tractor business along with Dar and other authorities concerned; nevertheless, the stakeholders immediately refused to work with the government.”
According to the prime minister, the government has made the decision to import second-hand tractors that are up to five years old (and have the appropriate certification) out of obligation to assist farmers who cannot buy tractors made locally.
He clarified that this decision, which is anticipated to hurt the local sector, would not have been made if the tractor business had partnered with the government. The premier also stated that people importing these used tractors older than five years would receive a 50% duty rebate, a 36% rebate for tractors older than three years, and that the concession rates would be determined appropriately.
We have decided to grant concession on the import duty of tractor parts, he said, adding that the duty on completely knocked down (CKD) parts has been reduced from 35% to 15% in order to encourage new players and investors seeking to enter the tractor industry.
The fertiliser plants have agreed to reduce the price of Di-ammonium phosphate (DAP) by Rs2,500 per bag, the premier said while providing more information. The DAP bag will now be sold in the market for Rs11,250.
Previously, the price of the DAP bag was roughly Rs. 14,000.
The prime minister announced that 1.2 million bags of certified wheat seeds will be free of charge to farmers in flood-affected areas through a partnership with the provinces and that Rs13.20 billion had been set aside for the programme. 50% of the Rs13.20 billion would come from the Center, he continued.
He also disclosed that 200,000 tonnes of the 500,000 tonnes of urea that the government planned to acquire have already arrived in Pakistan. He commended the industries minister and his team for negotiating the agreement in a way that enabled the government to save $100 per tonne. Under the government-to-government agreement, urea was initially available at a price of $600 per tonne, but thanks to the persistent efforts of the relevant authorities, the price was lowered to $500 per tonne.
“The government of Pakistan has also agreed to allocate Rs 30 billion as a urea subsidy in order to help the country’s agriculture sector by enabling small farmers to purchase fertiliser at a lower cost.
According to the prime minister, Pakistan will still need to import wheat due to the damage brought on by the floods even though it was previously doing so because of production that was below average.
He stated that 1.6 million tonnes of wheat would be imported, bringing the total to 2.6 million tonnes, of which one million tonnes had already arrived.
He explained that the government is striving to conserve every dollar and give people assistance, which is why all wheat import arrangements were government-to-government, and that is why he did not permit private sectors to import wheat.
He said that the government has decided to offer interest-free loans to the owners of the 300,000 tube wells now in use in Pakistan in order to reduce the cost of power. These tube wells are intended to be solarized.
He explained that the farmer will simply have to pay the instalment while the government will cover the interest amount, not electrical expenses.
The government, according to the prime minister, has decided to give farmers a “immediate” relief payment of Rs13 per unit, or a subsidy.
