Increased production cost: Subsidise diesel to save agriculture
Increasing fuel oil prices by 42 to 51 per cent brought a negative impact on every sector of public life. Although there is widespread criticism about its impact on the transport and industrial sectors, hardly anybody is talking about the impact on agriculture.
Agriculture as a sector is expected to be the most affected by the hike in fuel prices. The country will survive if agriculture thrives—this is not mere words. During the pandemic, mainly agriculture and export sector kept our economy running.
According to Prothom Alo, the farmers are grappling to meet the expenses during the peak season of Aman due to the increase in the prices of urea fertiliser and diesel within a few days gap. Aman paddy needs more irrigation due to less rain in the whole country this year. Farmers are also worried about whether they could recover the cost by selling the crops.
Not only is agriculture under pressure, food security is also threatened by the rising prices of fertiliser and diesel. If the cost of production of agricultural products increases, the price of agricultural products will also increase in the market. The signs of which are evident now. On 1 August, the price of urea fertiliser was increased by Tk 6 per kg and the maximum retail price was revised to Tk 20 per kg for the dealers and Tk 22 per kg for the farmers. Four days later, the price of diesel and kerosene was increased by Tk 34 per litre. The farmer has to buy fertiliser at a higher price than the fixed rate.
Former agriculture secretary Anwar Farooq recently said in a dialogue of research organisation CPD that 60 per cent of our rice comes from Boro. It is entirely dependent on irrigation. Irrigation requires 37,000 deep tube wells and 1.3 million shallow tube wells. Altogether there are 1.5 million agricultural machineries, 75 per cent of which are diesel run. If the price of diesel increases, the cost of irrigation will increase by Tk 700 per bigha. The cost of using power tiller and tractor will increase by Tk 300. Again, the cost will increase by Tk 500 due to increasing the price of urea.
The farmer is in a dilemma this year. Rainfall is usually more during the monsoon and farmers need to use less irrigation to grow Aman. Due to less rain this year, they had to rely more on irrigation while the price of diesel has also increased. And in the winter season, vegetables and Boro cultivation has to depend entirely on irrigation. Apart from this, increasing the price of fuel oil will increase the transportation cost of agricultural products. Farmers in some places also said to quit producing paddy due to high cost.
The government has to take two-pronged steps to solve this problem. The price of diesel used in irrigation must be reduced to bring down the cost of production. It can be done in two ways. One by providing financial assistance to farmers so that they can pay the increased cost of fuel.
Secondly selling diesel directly to farmers at lower prices. Many economists have also opposed the hike in diesel and kerosene prices. On the other hand, it should be ensured that the farmers get fair prices for the produce. There is no alternative to subsidising diesel to save agriculture and farmers.