Tobacco buyers asked to provide maximum relief to poverty-stricken growers

ISLAMABAD: A parliamentary body, on Monday, recommended conducting third-party audit for determining cost of production of tobacco crop, and asked local and multi-national tobacco buyers to provide maximum relief to the poverty-stricken tobacco growers.

The National Assembly Special Committee on Agriculture Products, which met with National Assembly Speaker Asad Qaiser recommended holding third-party audit for calculation of cost of production of tobacco after tobacco growers raised reservations during the meeting over the matter.

Qaiser also asked tobacco buyers including the Pakistan Tobacco Company (PTC), Philip Morris International (PMI), Pakistan, and other local buyers to provide maximum relief to farmers and also assured them the committee will also address issues faced by them during export of the commodity.

He said that the problems of cotton and tobacco growers would be tackled on a priority basis in the next meetings of the Special Committee on Agricultural Products. All-out effort would be made to ensure that the farmers of Pakistan receive decent profit for their crops.

The meeting also constituted a sub-committee to thoroughly review the issues including selling of inputs like fertilisers, pesticides and Personal Protective Equipment (PPE) such as gloves, masks, and goggles to farmers at higher rates by the multinational tobacco companies and hurdles faced by the farmers in encashment of tobacco company vouchers.

The committee asked the sub-committee to comprehensively examine the issues and present a report to the main committee within 10 days.

Asfandyar Khan, a farmer told the meeting that tobacco companies especially multinational have made it mandatory for tobacco growers that they will purchase inputs such Asfertilisers, pesticide, and PPEs from them, otherwise, companies will cancel agreements or contract of purchasing of tobacco of those farmers who refused to buy inputs from them.

He alleged that tobacco companies provide these inputs to farmers at higher rates as compared to rates of these items in the open market; therefore, the farmers should be provided full freedom with respect to buying of agriculture inputs.

Another farmer, Ahmed Jan said that tobacco companies provide them per bag of NPK fertilisers at Rs4,290, while we sell it to the local dealer of fertiliser at Rs2,800 because we do not need it.

If we refuse buying of agriculture inputs from tobacco companies they cancel our agreements, he said.

Khurram head of leaf of PTC, while rejecting the allegation levelled by the farmers, said that his company was providing interest-free tobacco crop inputs to farmers for the last four to five years aimed to provide relief and support to farmers.

We provided NPK to farmers at Rs4,115 per bag, while its market rate is Rs4,828, he said, adding that the company provides a pesticide namely,Ameda at Rs2,000, while the same product is available at Rs2,850 in the open market.

He also said that the company informs farmers at time of provision of these products and provide it to the farmers with their consent. Total number of farmers with PTC is 10,000 but only 6,000 buy inputs from the company but the company did not cancel agreement of those farmers who are not buying inputs from us.

Irshad Khan head of leaf PMI Pakistan also said that his company provides inputs to farmers at lower price as compared to the market. About provision of PPE, he said that under the World Health Organization (WHO) regulations we are bound to protect health of farmers. We pay transportation cost to farmers, he said.

Muhammad Ayaz Khan, a farmer said that according to a survey conducted by him, the estimated cost of production of one kg tobacco is Rs241, while tobacco companies buy one kg tobacco from farmers at Rs204 due to which farmers incur a loss of Rs37 per kg. He said that five districts of Khyber-Pakhtunkhwa are producing 99 percent tobacco of the country; therefore, Pakistan Tobacco Board (PTB) should be kept under the provincial government.

He said that there is nothing about provision of relief in the tobacco related law.

Khan said that that PTB, in collusion with the cigarette manufacturers, understate the cost of production of tobacco farmers leading to suppressed Minimum Indicative Prices. They demanded an independent third-party evaluation to ascertain the true cost of production. Qaiser asked officials of the Ministry of National Food Security and Research to propose amendment in tobacco-related law.

“Parliament had farmed the law and it will amend it,” he said.

Another farmer said that tobacco companies have introduced cumbersome and complex documentary mechanisms for encashment of vouchers due to which they wait in queues in scorching heat in front of banks.

He said that farmers face lengthy procedures and humiliation to encash the vouchers for their hard earned labour.

He demanded companies should provide payments inside their premises.

Liaqat Khan Tarakai, MNA said that farmers face problems during encashment of vouchers in banks; therefore, companies need to ask banks to open their special counters at each company depot to ensure smooth payment to the farmers.

On the issue of the vouchers, the representatives of multinational tobacco companies said that the new regulations were undertaken in compliance with the FATF and the company’s international obligations.

They further told the committee that they are making efforts to make bank to bank transfer of payment to farmers. We are trying that payment should go directly into the accounts of tobacco growers, they said.

Copyright Business Recorder, 2021