‘Transparency must in disbursing Rs32.5bln fertiliser subsidy’

ISLAMABAD: The National Food Security and Research Ministry on Monday discussed the disbursal mechanisms for Rs32.5 billion fertiliser subsidy in each province to ensure transparency in public expenditure.

Secretary National Food Security and Research Omar Hamid Khan during the consultative meeting with provinces said that out of the total Rs32.5 billion fertiliser subsidy, Rs28 billion was for Kharif season and Rs4.5 billion was for the Rabi season.

Discussing the fertiliser subsidy, the secretary said the system should be transparent and the National Food Security and Research Ministry would give a qualitative assessment on the provinces’ disbursement mechanism.

“This fertiliser will act as an incentive to boost production by reducing costs and at the same time represents the largest element of public expenditure in agriculture,” he added. He was of the point of view that restoring soil nutrients with sustainable fertiliser practices was critical to promote food security.

During the meeting, Punjab briefed about its scratch card scheme. The codes were printed and pasted inside fertiliser bags, the representative said. Explaining disbursal, they said the registered farmer has to purchase the bag, scratch the coupon and send an SMS to the designated number.

The system would recognise the details and send a confirmation. “Then the registered farmer can go to an agent with the SMS to encash the subsidy money,” they added. The system has been developed in such a way that every successive transaction, location and usage detail gets updated in real-time.

Balochistan on the other hand said it would discurse the subsidy through fertiliser dealers. Khyber Pakhtunkhwa representative mentioned that farmers in the province would get the subsidy through a coupon system.

In this regard, the province would use telefarming. The secretary informed the meeting participants that the ministry would analyse all the modes of disbursement mechanism and would share its assessment with the Economic Coordination Committee.

Reports revealed last week that the fertiliser sector obtained untargeted subsidies/concessions to the tune of Rs148 billion during the current fiscal year, leaving no other option before the government but to abandon this untargeted mechanism.

The incumbent government had been contemplating upon different options to do away with untargeted fertiliser sector subsidies/concessions, including ensuring direct transfer of subsidy to farmers after developing database.