The contribution of agriculture and livestock in labour absorption, raw material production and exports makes these the backbone of the economy. Agriculture helps sustain life by providing food and livelihood opportunities. It acts as a cushion to absorb economic shocks like the Covid-19 pandemic. Countries with resilient agriculture systems have been better able to absorb the shock and sustain an un-interrupted supply of food. Fortunately, Pakistan falls in this category.

Despite a huge contribution to the national economy and society, agriculture is facing multifaceted problems. The most important ones are: costly and poor-quality inputs, water non-availability during certain critical periods, poor-quality supply chain, weak governance and policy framework. These factors are not only hampering the development of farmers but also contributing to national food and nutrition insecurity.

A robust analysis of policy and governance framework highlights two areas requiring fundamental reform: 1) consideration of the basic statistics and 2) participation of real stakeholders.

Let’s focus first on the significance of basic statistics. According to the Agriculture Census 2010, there are 8.26 million farms out of which 7.35 million are small farms (having an area of less than 12.5 acres). These 7.35 million farms occupy only 25.42 million acres as compared to 0.929 million farms which occupy 11.39 million acres.

1.23 million of these farms are smaller than 1 acre, 2.34 million less than 2.5 acres, 1.75 million less than 5 and 1.13 million less than 7.5 acres. These facts indicate that a majority of the farming community has small land holding and is resource-poor.

Owing to the small land holdings, the majority does not have any voice in decision-making or implementation. These famers are often excluded from consultation and ironically represented by big landlords or consultants. The landlords and consultants have their own interests to watch that do not always align with those of small farmers. The problems faced by small farmers never get debated as few consultants understand real life dynamics of poor farmers. There is, for example, a raging debate on how to eliminate the role of middleman but less focus on the role the middleman plays. The middleman plays multiple roles according to the farmers’ needs. Sometimes he acts as a cash window. Sometimes he is approached for non-farming loans (for healthcare, education, marriage, etc). Formal lending institutions do not entertain such requests. Even for agricultural loans, many farmers wish to avoid the paper work and the lengthy procedures they have difficulty understanding. A middle-man is also the source of market information and often a transporter.

Thus, if the consultants or policy makers want to replace the middle-man, they will have to come up with viable alternatives.

Blanket subsidy and pricing policies of agriculture and food commodities is another area of concern. A blanket subsidy, usually offered in the form of price subsidisation, has little relevance for a majority of small farmers. They lack the financial resources needed to benefit from it. It only creates space for big farmers and corporate farming entities.

Pricing of agriculture commodities is another issue. The prices are determined by giving higher weight to consumption price so that food production cost gets very little weight. This denies small farmers any income so that their food security is compromised.

The government should devise a policy that can address the problems of farmers and food prices. The subsidy on inputs must be limited to small farmers.

There is a need to understand that food security is a comprehensive term. It includes vegetables, fruits, meat, cooking oil, spices and safe water supply. Farmers do not produce all of these things. They, too, have to buy many commodities and products from the market to secure food for their families. If we deny them suitable incomes how can they buy the commodities they do not produce? They also need money incomes to support other needs of their families like education and health. The government should take care of the urban and non-farmer poor but not at the cost of farmers.

The government should devise a policy that can address the problems of farmers and food prices. The subsidy on inputs must be limited to small farmers. It should be limited to up to 12.5 acres, according to categories defined by the agriculture census of Pakistan. The subsidy policy can be devised in the following three categories, 1) farmers with less than 2.5 acres should get 100 percent subsidy. 2) up to 7.5 acres should get 35-50 percent, and 3) less than 12.5 acres 20-30 percent.

On pricing side, the government should divide producers in four categories according to the sellable surplus. Let’s apply the proposed policy to wheat. The producers can be divided into the following groups, 1) famers with 15 maunds, 2) farmers with 30 maunds, 3) farmers with 50 maunds and 4) farmers above 50 maunds. The government should buy wheat at Rs 3,000/40 kg from the first group, at Rs 2,500/40 kg from the second group, at Rs 2,000/40 kg from the third group and at market price from the fourth group.

A similar formula should be applied on the consumption side. The government should divide the consumers in four groups, 1) people below the poverty line, 2) people with a monthly income of Rs 50,000, 3) people with a monthly income of Rs 100,000, and 4) above people with a monthly income exceeding Rs 100,000.

Legislating the subsidies will be difficult as many international conventions and World Trade Organisation rules and regulations prohibit it. It is suggested that the government should turn these interventions into social protection and poverty reduction programmes. Poverty reduction and social protection are not prohibited under the WTO rules. This might also attract international assistance for the proposed programmes.

Lastly, there should be a separate policy for corporate farming, which needs to be developed with two specific objectives, 1) contribution to national food security and 2) contribution to export earnings. The support from government in terms of rules and regulations, operations and financial assistance should be designed on the basis of these objectives. The government needs to be mindful that corporate farming sector should not be developed at the expense of small and poor farming community.

The writer is a researcher based in   Islamabad