Subsidy of Rs 16bn on agri tube-wells: Pakistan Agriculture 2013

April 28, 2013

Subsidy of Rs 16bn on agri tube-wells
Subsidy of Rs 16bn on agri tube-wells

ISLAMABAD: Agriculturists and landlords of all the four provinces are not likely to benefit from the power subsidy on agriculture tube-wells to the tune of Rs 16 billion recently approved. The Ministry of Finance has expressed its inability to provide this huge amount for implementation of this political decision, official sources informed on Saturday.

During the consultation state, according to the official sources, the Ministry of Finance was against the proposal to provide Rs 16 billion subsidies to the agriculture tube-wells which was approved by the government largely believed to muster political support in rural areas.

The Finance Ministry has reportedly informed the Water and Power Ministry about its inability to provide additional subsidy to the agriculture tube-wells due to financial constraints, the sources said.

The Ministry of Finance had allocated Rs 120 billion for subsidising power for the consumers other than agriculture tube-wells for the ongoing fiscal year 2012-13. However, due to the power theft amounting to 50 percent of the power sold to the consumers, line losses, transmission and distribution losses as well as inefficiencies of the generation sector, this power subsidies amount was raised to Rs 180 billion by mid the fiscal year.

The Finance Ministry has already provided more than Rs 290 billion to the power sector as tariff differential subsidy by the end of nine-and-a-half-month. The ministry has further committed for providing another Rs 45 billion in the next two weeks for arranging furnace oil stock for the generation companies to bring down the load shedding in the country during next three months.

The Ministry of Water and Power has replied to the Finance Ministry that it was finance and not its responsibility to clarify about the reasons to the authorities about what was hampering the implementation of the federal cabinet decision on subsidy on agriculture tube-wells.

The per unit cost of electricity by Rs 2 was to be reduced on to agriculture tube-wells by using the approved Rs 16 billion subsidy which is not possible now after the refusal of the Finance Ministry.

Prime Minister Mir Hazar Khan Khoso had directed the finance, petroleum and water and power ministries to provide Rs 45 billion and 150 million cubic feet per day gas to the power sector in the outgoing fiscal year to contain the load shedding.

An official said the approval of agricultural subsidy was originally proposed at Rs 42 billion but was strongly opposed by the Finance Ministry and, hence, it was brought down to Rs 16.4 billion.

An official on condition of anonymity said that it was just a political gimmick of the previous government to announce a major financial package to please rural voters for a few days ahead of completing its tenure, but this is not going to be implemented before next budget and that too at the discretion of the next political government, he said.

Had the previous government been serious about extending subsidy to tube-wells, it should have referred the matter to the Council of Common Interests because it was an issue of inter-provincial nature, said the official. Source Daily Times

 

Published: Zarai Media Team

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