No plans to raise diesel subsidy for irrigation
S M Jahangir | Friday, 11 July 2008
The government has no immediate plans to enhance its cash subsidy allocation for distribution among cultivators of Boro crop on their use of diesel for irrigation purpose despite a significant rise in cultivation costs following the recent upward adjustment of gasoline price.
"Currently, we are not thinking about any increase of our allocation for the payment of cash subsidy on diesel to be used for the irrigation purpose," a senior Agriculture Ministry official said.
Rather, the Ministry of Agriculture will take necessary steps to streamline the disbursement process of the allocated subsidy so that the cash supports reach the targeted farmers, he added.
The official further said the government is not in a position to raise its allocation for payment of direct cash support to the farmers against the use of diesel for irrigation purpose as it has to a spend a large amount of fund on account of subsidy for the agriculture sector.
Even after the recent upward adjustment of urea fertiliser prices, the government will require spending around Tk 160 billion as subsidy for the country's agriculture sector in the fiscal year 2008-09.
The ministry officials also mentioned that the government had raised the allocation for payment of subsidy on diesel use for irrigation to Tk 5.40 billion in the current fiscal year from around Tk 2.50 billion, taking the recent hike in the gasoline price into consideration.
Due to enhancement of the budgetary allocation, not only the number of beneficiary farmers will increase in the current fiscal, but also the amount of cash subsidy will be significantly higher than last year, they said.
In the last fiscal year, the government disbursed cash subsidy among 6.6-million listed farmers and the beneficiaries received Tk 545 as subsidy on the use of diesel for irrigating one acre of Boro land.
Officials also said the authorities have not yet set any criteria for the disbursement of cask subsidy among the farmers for the current fiscal.
Experts and agriculturists, on the other hand, have also suggested that the government should enhance its allocation for providing cash subsidy to farmers on their use of diesel for running irrigation pumps, especially in the Boro cultivation seasons.
Among other petroleum oils, the government raised Monday the price of diesel by 37 per cent to Tk 55 per litre from the previous rate of Tk 40 in order to reduce its ever-growing subsidy on account of marketing fuel oils at much lower than their import costs.
The recent hike in the prices of diesel will its toll on the country's Boro cultivation unless the government takes prudent steps to help marginal farmers rein in their enhanced irrigation costs, they observed.
The latest price hike of diesel alone will push the production cost of Boro paddy by Tk 0.60 to Tk 0.65 per kilogramme (kg), experts said.
Boro cultivators will require spending Tk 1000 to Tk 1200 more for irrigating each acre of land due to the latest hike in the diesel price, they said, adding that the average irrigation costs for one acre of Boro land was estimated at Tk 5,500.
"Currently, we are not thinking about any increase of our allocation for the payment of cash subsidy on diesel to be used for the irrigation purpose," a senior Agriculture Ministry official said.
Rather, the Ministry of Agriculture will take necessary steps to streamline the disbursement process of the allocated subsidy so that the cash supports reach the targeted farmers, he added.
The official further said the government is not in a position to raise its allocation for payment of direct cash support to the farmers against the use of diesel for irrigation purpose as it has to a spend a large amount of fund on account of subsidy for the agriculture sector.
Even after the recent upward adjustment of urea fertiliser prices, the government will require spending around Tk 160 billion as subsidy for the country's agriculture sector in the fiscal year 2008-09.
The ministry officials also mentioned that the government had raised the allocation for payment of subsidy on diesel use for irrigation to Tk 5.40 billion in the current fiscal year from around Tk 2.50 billion, taking the recent hike in the gasoline price into consideration.
Due to enhancement of the budgetary allocation, not only the number of beneficiary farmers will increase in the current fiscal, but also the amount of cash subsidy will be significantly higher than last year, they said.
In the last fiscal year, the government disbursed cash subsidy among 6.6-million listed farmers and the beneficiaries received Tk 545 as subsidy on the use of diesel for irrigating one acre of Boro land.
Officials also said the authorities have not yet set any criteria for the disbursement of cask subsidy among the farmers for the current fiscal.
Experts and agriculturists, on the other hand, have also suggested that the government should enhance its allocation for providing cash subsidy to farmers on their use of diesel for running irrigation pumps, especially in the Boro cultivation seasons.
Among other petroleum oils, the government raised Monday the price of diesel by 37 per cent to Tk 55 per litre from the previous rate of Tk 40 in order to reduce its ever-growing subsidy on account of marketing fuel oils at much lower than their import costs.
The recent hike in the prices of diesel will its toll on the country's Boro cultivation unless the government takes prudent steps to help marginal farmers rein in their enhanced irrigation costs, they observed.
The latest price hike of diesel alone will push the production cost of Boro paddy by Tk 0.60 to Tk 0.65 per kilogramme (kg), experts said.
Boro cultivators will require spending Tk 1000 to Tk 1200 more for irrigating each acre of land due to the latest hike in the diesel price, they said, adding that the average irrigation costs for one acre of Boro land was estimated at Tk 5,500.