The newly appointed Federal Minister, Khair Muhammad Junejo,
in his first policy statement after assumption of his office made the startling
announcement that wheat production target for the year 2000-2001 has been
revised downward from 22 million to 20 million tonnes fixed by his predecessor
last month. The revised target of 20 million tonnes is less by 1.5 million then
the actual production of 21.5 million tonnes during the outgoing year of
1999-2000.
The federal minister made this announcement after presiding
over a meeting of federal committee on Agriculture (FAC). The 3rd meeting which
was also attended by all the four provincial Food and Agriculture Ministers was
called to review the crop production during the Kharif season, revise and fix
realistic target for coming crop and review the water availability situation. It
is understood that the provinces took the plea that the target of 22 million
tonnes of wheat for the upcoming Rabi crop was too ambitious in view of likely
shortage of water for irrigation purposes. The provinces feared a shortage of
water supply by about 30 per cent during Rabi season. Similarly, provinces
raised hue and cry over the drastic increase in the prices of DAP fertilizer in
particular by Rs.200 per bag over the last year. They were of the views that
this increase will lead to lesser use of DAP which was a main input to increase
the crop production.
After discussing these negative factors, it was decided to
refix target at 20 million tonnes. The Punjab will produce 14.8 million tonnes
against earlier projection of 16.6 million, Sindh 3 million tonnes against 3.1
million, N.W.F.P. 1.4 million against 1.3 million tonnes, Balochistan 0.7
million tonnes against 0.8 million tonnes, and AJK will produce 0.1 million
tonnes.
The meeting was, however, informed that for the year
2000-2001, a record quantity of quality of wheat seed (over 63,000 tonnes has
been procured for the Rabi Season. The Indus River authority (IRSA) officials
briefed the participants of the meeting regarding the water supply position.
They told them how it can be improved by the provinces by improving their water
management system. Surprisingly however, the committee felt happy over the
situation about standing Kharif crop and hoped that targets fixed for various
crops will not be met but surpassed in some cases. The committee expected
production of 4.5 million tonnes of rice, 10.5 million bales of cotton, 41
million tonnes of sugarcane, 1.8 million tonnes of maize and 1,96,000 tonnes of
chilies. The committee also discussed the issue of support prices of various
crops and strongly advocated that these will remain an important tool for
ensuring guaranteed return to growers in various agricultural commodities.
The decision to reduce wheat production target is undoubtedly
a retrograde step in the context of the imperative need to achieve a higher rate
of growth in the country's GDP. As a consequence of it, the farming community as
a whole would also be confronted with a big setback in their efforts to increase
production of wheat and other crops. All preparations by the farmers to get a
larger wheat crop from their land, partly through adoption of improved methods
to obtain higher per acre yield and partly by bringing additional land under the
crop, might be set at naught by official announcement of reduction in production
in the coming season. Another discouraging factor for the farmers is that there
is going to be no more upward revision in the support price of wheat because the
government obviously does net want to offer any incentive to the farmers for
increasing wheat productions in the next season.
The Food and Agriculture Minister explaining the reasons for
containing wheat production, reportedly pointed to the severe water shortage in
the country in the face of which, he stated, it would not be possible to further
increase production next season. The water shortage is feared partly because of
forecasts of inadequate rains in the coming months of December and January and
partly because of low levels of water in the country's major dams. The minister
also revealed that severe water shortage in the beginning of the Kharif season
this year had caused a great setback to sowing of sugarcane, cotton and rice.
The provincial governments, according to him, opposed an increase in the target
of wheat production because of water shortage. At the same time, however, he
gave the happy tidings about the ongoing progress and production of major Kharif
crops like cotton, paddy/rice.
The question arises as to how far the farmers, who must have
made all necessary preparations, including tilling of land, procurement of wheat
seed, advance purchases of fertilizer etc. would be able to follow the
government's latest announcement for reducing the production of wheat. Moreover
the farmers who might have completed early sowing of wheat in some areas would
be faced with losses. Thus the repercussions of the government's announcement
are going to be wide-ranging. In the first place, the psychological setback to
the farming community may cause a loss of enthusiasm and confidence in the
agriculture sector as whole. Next, the reduced income flow to farmers may lead
to loan repayment defaults on the farmers part and further financial
difficulties for them.
In the face of the deterioration in the performance of the
agriculture sector which is the backbone of the economy with 25 per cent share
in the GDP, it is obvious that the economic growth is likely to be adversely
affected. It has now become doubtful whether the target of economic growth
placed at 4.5 per cent, would at all be realised. The consequences may land the
country in further difficulties in negotiations with the IMF and donor
countries, while the revival of their financial assistance largely hinges on
improved recovery performance of the economy.
