Govt may raise fertiliser subsidy diverting funds from diesel

---

Shakhawat Hossain
The government, struggling to boost agriculture production against the backdrop of recent crop losses, might enhance subsidy on fertiliser sale by diverting fund kept for subsidising the price of diesel.
The caretaker government had allocated Tk 7.5 billion in the national budget for the first time, to subsidise the diesel price.
Sources said the government might initiate such a move due to escalation of fertiliser price in the international market.
They said the government thinks it as the most viable option to stave off the import cost of the fertiliser that has risen more than 50 per cent.
Some Tk 22 billion has been kept in the current fiscal budget to meet the fertiliser subsidy. But more than Tk 40.0 billion will be required to finance the import of fertiliser following the price hike of the input in the international market.
The sources said under the circumstances, the caretaker administration might decide on the utilisation of fund kept for the diesel subsidy to meet the higher cost of fertiliser.
They, however, said any decision on withholding diesel subsidy will be a difficult choice for the authorities as farmers across the country had welcomed the caretaker government for allocating diesel subsidy in the current fiscal budget for the first time.
On the other hand, the criteria on distribution of diesel subsidy have not yet been set.
A meeting under the finance ministry on budgetary measures last week once again urged the agriculture ministry to prepare the criteria on diesel subsidy immediately.
The meeting hinted that without proper criteria, it will not disburse any fund kept for diesel subsidy, sources said.
Available statistics suggest that diesel-run pumps cover almost 77 per cent of the country's irrigation on some 3.6 million hectares of land during Boro cultivation season.