Speaking in the House of Representatives after the announcement of the current fiscal year’s budget, you said that the programmes announced by the Ministry of Agriculture and Livestock Development (MoALD) was not included in the government’s Policies and Programmes and the Federal Budget. What are the main objectives of the ‘Protected Agriculture and Ensured Savings’ programme? Which programmes of the Ministry was not included in the budget?
Agriculture is a very difficult profession and savings of people engaged in this sector is also very low. Mechanisation makes works easier, but for a transformative change in agriculture, minimum savings of farmers must be guaranteed. This is what we are targeting from the ‘Protected Agriculture and Ensured Savings’ programme which has five policy fundamentals. The first one is to provide grant on production materials.
Under this, the focus is on distribution of grants for key production materials such as seeds, fertilisers, irrigation and electricity to all farmers instead of individual competitive grants. Second, it aims to provide technical services and support to the farmers at their doorsteps. The 8,000 vacant positions of the local levels will be filled, and people will be sent to villages to provide support to farmers. Third, every farmer will be guaranteed access to loans at cheap interest rate which will not exceed 5 percent. Fourth, in order to protect farmers from the loss of crops and livestock by natural disasters and other calamities, the crop and livestock insurance will be expanded.
Fifth, the minimum support price will be set by evaluating the production cost of the main crops and agricultural commodities to guarantee fair savings; it will also enable farmers to sell their products in the market at higher prices than set by the government. The government will make arrangements to buy farm produce if farmers did not get even the minimum price in the market.
Some of the programmes of MoALD have been incorporated in the government’s Policy and Programmes and the Federal Budget. But I think the inclusion is not enough to realise our vision and the things ministry is prepared to do. I have already presented our vision to transform the agriculture sector in the Federal Parliament and have pointed out the weaknesses seen in the budget and policy making.
Does this mean that the process of budget formulation in Nepal is dominated by and Ministry of Finance which even rejects the priorities set by other ministries?
The entire budget of the country is prepared by the Ministry of Finance. But the budget should be directed to solve the problems of different sectors and address aspirations of the general public. Rather than being dominating, it should be a document that gives a sense of responsibility to everyone enabling them to assess their potential and offer guidelines for future. It is the MoALD which knows better the kind of policy required for the development of agriculture in Nepal and programmes to run according to the budgetary limit. If it’s understood this way, there won’t be many problems.
This year’s budget shows an effort to link farmers to the market by departing from the subsidized agriculture. How is MoALD preparing necessary infrastructure to create the market?
We are working to end the practice of individuals writing proposals to receive government grants. While grant is necessary in the development of the agriculture sector, our effort is to end the grant system which is only accessible only to the clever ones.
In the past, our focus was more on agriculture production and productivity. We will now focus on increasing farmers’ access to market and ensuring a fair price to of their products. For this, works like implementation of minimum support price, study on market management, development of necessary market infrastructure, will be carried out. Similarly, all local levels will be linked to the market, the feasibility of national and international agricultural trade will be studied, and farmers will be informed about the programmes. For the purpose, a structure will be set up under MoALD for which we have also arranged budget in the current fiscal year.
There have been efforts in terms of democratisation of the agricultural budget to some extent by increasing the source to the lower levels. How is MoALD planning to move ahead in this regard? Will there be a concrete programme on this in the next year’s budget?
Now the provincial governments and local bodies are the main drivers of agriculture development. Their capability will be enhanced. We will continue to develop local levels as automated cells of agricultural development. Under this, there will be mechanism to distribute seed, cooperatives to distribute fertilisers, technical manpower to train farmers, agencies for agricultural credit and insurance, custom hiring center for agricultural tools, milk collection centers, cold storages and warehousing facilities. There will also be an arrangement for processing farm produce.
For preparing necessary infrastructure, we have allocated and disbursed much larger budget to local levels than in the past. Some works will be carried under the leadership of the federal government. A clear picture about our works will emerge before the next year’s budget.
You have said that data will be collected to identify actual farmers before providing them pension. How is the process of farmers’ registration being carried out? When will the farmers start receiving pension?
To start the registration process, all local levels have already received federal budget. Provincial government and local levels have also allocated additional budget for the purpose.
The guidelines of the Farmers’ Pension programme is in the process of approval. All preparations will be done before Dashain and after Tihar it will be launched as a nationwide campaign and will be a continuous programme.
The fixing of minimum price of the main crops has started. You said that the government will make arrangements to buy if farmers do not get minimum price for their farm produce. How is MoALD managing source for this?
We have started the practice of setting support prices of paddy and wheat before the crops are planted. Similarly, support prices of sugarcane and milk have been fixed in different ways. Support price of farm produce guarantee savings of farmers and is scientific. We are also preparing to buy farm produce if farmers are unable to get the minimum prices.
The private sector, cooperatives, and food management companies will be engaged in this initiative. Old warehouses are being repaired for storage and new warehouses are also being constructed in different parts of the country.
The acute shortage of fertilizers got repeated this year as well. The government has reached the point where the fertilisers have to be borrowed from Bangladesh. How is this particular problem being solved in the long run?
We are sad that farmers have to face this problem repeatedly. There has been a lot of discussion in the past to prevent disturbances in supply of fertilisers. We have identified three main problems in this regard.
First, it is the insufficiency of budget for timely distribution of fertilisers. Second, delay in tender process also hinders timely supply. Third, there are problems in distribution such as irregularities, shipment of fertilisers to unintended places, distribution of subsidised fertilisers to non-agricultural sector and lack of proper audit in distribution are the problems.
We modified the work procedures for chemical fertilisers in an attempt to manage the supply, transportation and distribution of fertilisers by using advanced software and made the process transparent by notifying people through the website to solve most of the problems in distribution. To resolve the issues in supply of fertilisers due to the low availability of fund, Rs 11 billion has been allocated and disbursed.
The tender bidding was also held two months earlier compared to last year so as to ensure timely supply. With all the preparations, we were confident that the fertilisers would arrive on time and the distribution would be transparent. But at the same time, the worldwide lockdown due to the epidemic also seriously affected the supply chains. Due to prolonged closure of ports, supply was delayed, and later due to contractors, fertilisers could not arrive on time and the farmers had to suffer.
This has taught us a lesson that the modality of supply is not sustainable. For the time being, we are preparing to borrow fertilisers from Bangladesh. For the future, we are preparing uninterrupted supply modalities. At the same time, we are studying the feasibility of fertiliser plant in the country.