LAHORE -  The Punjab Agriculture Commission, in its Agriculture Policy Draft, has called for reforming the agriculture sector as a profitable industry by promoting investment in the infrastructure, research, outreach, skills, value chains, agro-industry and rural development.

Punjab Chief Minister Shehbaz sharif, in March last year, had constituted an Agriculture Commission, mandated to devise an agriculture policy for the province. The policy committee held stakeholder meetings and deliberated for months. A series of consultative meetings were organised at the farmers’ level as a bottom up exercise. A draft document was prepared and circulated among the stakeholders widely, including the World Bank, ZTBL, HEC, PARC, IFPRI, FAO, IFAD and CABI. The feedback was minutely examined and incorporated in the final agriculture policy draft.

The review exercise of the agriculture commission revealed that there was no shortage of information but a serious lack of implementation. The Agriculture Commission said that at present, the Agriculture Sector Development Framework of 2015 and a livestock policy paper are in place which must be rewritten by 2018. It proposed that food security must include nutritional security while political economy of food security must not compromise profitability of the farmer.

“The immediate targets should be addressing the small farmers’ productivity challenges by ensuring quality seed, machinery, balanced fertiliser, IPM and weed management. The public procurement of wheat should be phased out and the available resources should be used to incentivise crop diversification. Canal water theft must be stopped. The HEIS must be evaluated and redesigned. Medium to long-term plans should be devised for land and water resource management.”

The commission said that grain and produce markets are insufficient and imperfect. The infrastructure and legal frame work are needed to enhance the capacity and to promote transparent and competitive business systems, minimising the role of middleman. The commission proposed that investments should be made in skill development to reduce post-harvest losses and to add value. The quality standards and WTO requirements and regional opportunities offered by CPEC must be addressed by becoming globally competitive. A comprehensive market reforms programme is needed.

It recommended that the investment in R&D should be linked with the institutional reforms for the integration of education, research and extension. Commodity research boards should be institutionalised. Establishment of two research centres, one each on policy, law and governance and soybean are highly recommended. It said that long-term research experiments needed be launched to model sustainability of the cropping systems.

It stated that rural development must include infrastructure for farm to markets at a much bigger scale than the present. The rural life must be made attractive to arrest migration and by introducing women and youth development programmes along with alternate income propositions, it added. The Agriculture Commission, under the short-term strategies, called for working with the small land holders for the timely provision of inputs, services and credit along with guaranteed irrigation.

“The cost of production must be contained initially by input subsidy to be followed by productivity enhancement. The farmer will also respond to the market signals ie support price and public procurement initiatives. The current yield-gaps and stagnation must be treated separately. The yield-gaps can be addressed by the delivery/adoption of available technology while the potential stagnation cannot be broken without investment in research to develop new precision tools and biological interventions. Reducing the yield-gap by a half is an achievable target for wheat, rice and cotton by simply optimising the plant population, enough to accelerate the GDP growth to 4 percent. And that will spare about 2 million hectare land for crop diversification. The implementation of 100 billion ‘kissan package’ could address this priority well.”

The commission, in its policy draft, said that crop diversification is a challenge, as the complication arises from the political economy of food security. “We can broaden our choices by focusing on two crops ie wheat for food security and cotton for cash. The productivity enhancement of two crops can easily spare land for oil seeds, edible legumes, soybean, fodders, vegetables, coarse grains and orchards. There are good reasons to deemphasize rice and sugarcane due to water cost to the public. The 5th crop, corn in its present rotation system is also unsustainable. It must be rotated with a legume, preferably soybean for sustainability. The farmer’s uptake of new crops will depend on the market signals or a public procurement policy. The government has to offer guaranteed minimum returns for the alternate crops. A part of wheat procurement budget should be diverted to minor crops.”

The commission said that the immediate option is to redefine crop zones on the basis of long-term climate trends, soil and water analyses, available technologies, skills, markets and industrial demands. The Punjab can be divided into about 30 different crop zones and sub-zones. That will allow a precise decision mechanism for technology transfer and incentive packages.

“There should be an emergency plan to curtail the post-harvest losses by a half. That will need an investment in the training programmes to promote value-addition by product development and for market preparations along the value-chain. Home science group should be introduced in the rural development and extension programmes. The investment is also required in the transportation and storage infrastructure. The marketing system needs a long term improvement plan in terms of new markets, legislation and governance reforms. The Punjab rural roads programmes must be amplified and the example of cattle markets should be replicated to create a new structure of grain and produce markets. CPEC routes should be marked for the establishment of new agro-processing zones and markets for exports to the regional markets.”

Under the long-term strategies, the Agriculture Commission said the short term strategies can raise the agriculture sector growth above 4 percent for the near future. However, for long-term sustainability of the system, agricultural growth and poverty alleviation, the food security paradigm must shift from a supply side excess of staple items to integrated nutritional package where diversified dietary needs are met (zero hunger). Food safety issues like pesticide and antibiotic residues in the food, myco toxins, and malpractices associated with the food handling must be addressed, it added.

The commission stated that all food secure countries in the world have less emphasis on wheat and rice and more on corn, potato, soybean, vegetables, dairy and poultry. “Performance of agriculture is linked with the performance of many public and private sector institutions. That requires legislative and administrative measures, political will and social movements. There are federal and provincial legal frame works. With the 18th amendment, many a confusions have arisen which have diminished the role of already under performing federal institutions. The Seed Act, the Plant Breeders Act, the Pesticide Act, the Fertiliser Act, the Cooperative Act, the Market Act, National Bio-safety Committee are obsolete instruments.”

“The commission said that unfortunately, our NARS are incompetent, full of overlaps and segmented (research, education and extension). There are institutions which have lost their relevance after 18th amendment that includes Pakistan Forest College in Peshawar, FSC&RD and to some extent the PARC. The mechanisms are needed for funding research well above the current level of 0.18 percent of agricultural share in the GDP. Autonomous commodity boards are an option to levy a research tax on the value added agricultural value chains.”

In order to improve the profitability of various commodities, there is a need to move back to the support price system (selectively) and provision of inputs at subsidised rates (targeted). The ultimate aim should be progressive liberalisation and deregulation to let the market forces work, it proposed. “The farmer is always cash strapped and at the mercy of ‘rent seekers’. He needs credit. Looking at the agricultural share in the GDP and corresponding formal credit availability, it is evident that there is a case of huge underinvestment. The vacuum is being filled from the non-formal sector at exorbitant costs to the farmer. In Punjab, there are 136 branches of Punjab Cooperative Bank which are dysfunctional. We need to create Marketing and Services Cooperatives to revive the supply of credit through these branches. That will require market reforms, investment in the improvement of supply chains, promotion of clusters and enablement for value addition. Revival of cooperatives can boost the productivity of small farmers in many ways. The development of CPEC offers an opportunity of SEZs (Special Economic Zones) which could be agro focused centres for value addition.

Agriculture and rural development go together. The rural infrastructure development (roads, school, health) and skill development need massive investment. The agriculture and veterinary universities should be mandated to prefer students’ intake from the rural schools. The commission also called for analysing public investment in agriculture sector, besides institutionalisation of public investment priorities in agricultural infrastructure and marketing with a clear commitment of finances for a considerable time frame. This includes rural roads, storage and markets, improvement of irrigation and drainage, credit and subsidies, legislation for missing laws, controlling water theft, revamping marketing system, phase out public procurement of wheat, incentivising crop diversification, improving seed sector, facilitating and regulating private sector and prioritising agricultural research etc.