Fertilizer subsidy may hit snags

A subsidy of Rs 27.96 billion announced by federal government in budget 2016-17 with a 50 percent provincial share may hit snags as no other province except Punjab has made any contribution.
Secretary Ministry of National Food Security and Research (MNFS&R) Muhammad Abid Javed while briefing Senate Standing Committee on National Food Security and Research about fertilizer subsidy said that only government of Punjab has provided a cheque for Rs 1.98 billion out of its Rs 10.20 billion due share and also promised that they would provide the remaining amount on a monthly basis. The committee met with senator Syed Muzafar Hussain Shah in the chair.
"The provincial governments of Sindh, Khyber Pakhtunkhwa and Balochistan have so for not provided their due shares in fertilizer subsidy despite repeated requests," Javed further said. He informed the committee that MNFS&R has written a letter to Ministry of Finance that provincial governments are delaying contributions of their due shares in the subsidy package; therefore there was a need for a deduction through source against their due shares.
Senator Syed Muzaffar Hussain Shah asked the representative of Ministry of Finance whether could deduct the due shares from their sources without their consultations, he said, "we cannot deduct the due shares of subsidy from their source without consultation with them".
Shah questioned Javed about the steps he would take if provinces refused to provide their due shares, he said he would have no option but to ask the government to stop it. According to official document shared by the MNFS&R as per a sequel to the previous the federal government in consultation with provincial governments has provided the cash subsidy of Rs 300 per bag for DAP and Rs 156 per bag for urea fertilizer.
Initially, it was worked out that a subsidy of Rs 27.96 billion would be required to provide the cash subsidy to the manufacturers/importers of urea and DAP fertilizers on the basis of 50:50 federal and provincial government contribution.
Out of total subsidy of Rs 27.96 billion, the total share of federal government is Rs 13.98 billion, Punjab's Rs 10.20 billion, Sindh's Rs 2.65 billion, Khyber Pakhtunkhwa's Rs 0.70 billion and Balochistan's Rs 0.42 billion. The committee observed that the committee is of the view that provinces should honour their commitment so that farming community, which is entitled to the subsidy, takes full advantage of it.
The committee also passed "the Plant Breeders Right Bill, 2016" moved by Sikandar Hayyat Khan Bosan, federal minister for MNFS&R, and expressed its displeasures over non-serious attitude of provinces towards the development of agriculture sector particularly after the passage of 18th constitutional amendments. The bill has already been passed by the National Assembly.
The committee was informed that Pakistan being a member of the World Trade Organization (WTO) is obligated to provide rights to the breeders of new plant varieties under Article 27.3(b) of Trade-Related Aspects for Intellectual Property Rights (TRIPS) Agreement.
This protection to the breeders of new plant varieties in various countries was provided in the shape of Plant Breeder's Rights Law. At present, the Plant Breeders' Rights law was in vogue in more than 74 countries of the world, the committee was informed.
The statement of objectives and reasons of the bill says, "Plant Breeders' Rights are specific type of Intellectual Property Rights granted to the breeders of new verities of plants. Establishment of a viable seed industry is essential to the food security in Pakistan to ensure the availability of high quality seeds and planting material to farmers, it says.
The main objectives of the proposed law is to encourage plant breeders and seed organization of both in public and private sector to invest in research and plant breeding, to develop superior varieties of filed, vegetable and ornamental crops, facilitate in access to protected foreign verities and new technologies and effectively control menace of counterfeiting in the seed sector for betterment of farmer community and food security in the country.
Javed said that many foreign companies were reluctant to invest in Pakistan seed sector due to lack of protection for their products because of the absence of an effective variety protection system. However, he expressed the hope that after the passage of Plant Breeders Right Bill, more investment and transfer of modern technologies would come to Pakistan. He told the committee that farmers' rights had adequately been protected in the proposed law.