In order to help farmers after the damage caused by severe flooding, Prime Minister (PM) Shehbaz Sharif has announced a Kissan Package on Monday.
According to the Prime Minister, the country’s progress is only possible through the development of the agricultural sector, therefore, the government will provide farmers with loans worth Rs. 1,800 billion, which is four times more compared to the previous year.
He added that Finance Minister Ishaq Dar is quite strict and he will ensure the disbursement of loans to the farmers as commercials banks avoid providing loans to small farmers and entrepreneurs and look for more secure investments.
Here are the highlights of the Kissan Package announced by Prime Minister Shehbaz Sharif in order to help the agriculture sector and get farmers back up on their feet after the devastating floods that ravaged the country.
Waiver of Loans
The Prime Minister said that markup on loans taken by farmers belonging to flood-affected areas has been waived off and the government has allocated nearly Rs. 11 billion for this purpose. He added that this package has been prepared by the Ministries of Finance and Food Security for the revival of the agriculture sector across the country.
Loans on Low Markup
Furthermore, the Centre and smaller provinces will also provide more than Rs. 8 billion to small farmers in flood-affected areas along with loans worth Rs. 50 billion to youngsters living in rural areas to help them become professional farmers. According to the details, youngsters will be provided loans with a markup less than the market rate and the government will set aside nearly 6.5 billion for the venture
Reduced Prices of Fertilizer & Urea
Moreover, the government is reducing the price of fertilizer and urea, while ensuring availability in sufficient quantities. According to the details, Prime Minister Shehbaz Sharif announced reducing the fertilizer price by Rs. 2,500 per bag on Di-ammonium phosphate (DAP), which will now be available at Rs. 11,250 in the market,
Meanwhile, the government will provide a subsidy of Rs. 30 billion on urea and the government has planned to import 500,000 tons of urea out of which 200,000 tons have already arrived in Pakistan. He praised the industries minister and his team for negotiating the deal in a manner that helped the government save $100 per ton as government previously procured urea for $600 per ton, which will now cost $500 per ton.
The Prime Minister has announced interest-free loans for tenant farmers in flood-hit areas. “Subsidy worth Rs5 billion have been allocated for these loans,” he said, adding that the government has increased the value of Produce Index Unit (PIU) from Rs. 4,000 to Rs. 10,000 for obtaining loans for agriculture purposes.
Furthermore, the government has allocated Rs. 10 billion for the Small and Medium Enterprises (SMEs) in the agriculture sector for the SMEs modernization scheme.
Prime Minister Shehbaz Sharif said that the government has decided to import second-hand tractors to provide cheaper alternative to more expensive locally built tractors as there is a monopoly in the local tractor industry and stakeholders have refused to cooperate with the government.
According to the details, the government will import up to five years old second-hand tractors (with proper certification) in order to help farmers who cannot afford the locally manufactured tractors. However, he added that had the tractor industry cooperated with the government, this decision would not have been taken as it would damage the local industry.
The premier also announced that a 50% rebate on duty will also be given to those importing these five-year-old second hand tractors, 36% rebate on three-year-old tractors, and the concession rates will be calculated accordingly. “In order to incentivise new players and investors planning to become a part of the tractor industry, we have decided to give concession on the import duty of tractor parts,” he said.
He added that completely knocked down (CKD) parts have been brought down to 15% from 35%.
Converting Tube Wells to Solar & Electricity Bill Installments
Furthermore, the government also plans to launch an initiative to convert Tube Wells to solar energy and provide installments in electricity bills for farmers.