As the new Finance Bill (2017-2018) was in the making, everybody was looking up with high hopes to the economic managers and government for long-term relief to the farmers; however, the budgetary speech has left much more to be desired. In the new budget (2017-2018), Finance Bill seems quite promising for the agro- economy as compared to the barred incentives offered and promised by the government last year. One example to quote is of Kissan Package which was offered a positive intent by the government for the plight of farming community but it could not be of much help to the agro-sector due to market instability and somewhat inappropriate timing of announcement of subsidies. As a result, the intent of the government to support and strengthen the agro-sector could not be materialized. 

Another example is of Complex Subsidy Reimbursement Mechanism which has further burdened the fertilizer sector by causing serious cash flow problems, making all those repent who wanted to help the government in its initiative. Such unfulfilled promises and commitments by the government resulted in a serious trust deficit between the government and other stakeholders. 

However, this year around, the government, being a policy maker seemed to have adopted a visible different approach with an intent of bridging the gap between all the stakeholders on ground and policy makers. Probably, this is why they provided opportunity to the input providers to forward their recommendations, but it seems that the government needs to come up with certain corrective measures to ensure long term relief to agro-sector, through favorable and farmer friendly agro-policies. 

The need of hour is to understand that the government and other stakeholders need to sit together to carve out a way forward for improving farm economics. The contribution of last year which played an important role in uplift of the agro-economy by sharing subsidy mechanism with the government must be given a clear policy confidence in the new fiscal year. 

It is therefore suggested to the government to consider agro-experts’ suggestions regarding reduction of GST on inputs, providing relief in terms of reducing the cost of production of input and by easing GIDC to alleviate the long deprived farming community of additional burden. Moreover, the government should come up with corrective measures in approved budget to reduce the cost of input so that fertilizer prices in Pakistan may be made competitive with the International market. The efforts of all stakeholders which went into exercise of pre-budget suggestions is also worth considering. 


Islamabad, June 6.