Chances of misuse of subsidized fertilizer are high as no proper mechanism has been developed and preparations made for the distribution, officials say.
“We have no special guidelines for distributing the subsidized fertilizers. The prices for the fertilizer have not been fixed and the subsidy is too little compared to the demand,” said Pashupati Gautam, managing director, Agriculture Inputs Company Ltd.
According to estimates, about 300,000 tons of fertilizer is used by farmers per year.
“Given the growing demands for fertilizers, subsidy of only for 100,000 tons will lead to huge problem in distribution,” said Shankar Sharma, former vice chairman of National Planning Commission.
The Ministry of Agriculture has demanded Rs 1.76 billion for providing farmers 100,000 tons of fertilizer at subsidized prices for the coming fiscal year. In the fiscal year 1996-1997 the subsidy amount Rs 600 million. The government ended subsidy from 1997-1998.
Sharma remembers back in 1997 when police had to be deployed at fertilizer distribution centers to prevent clashes as farmers fought for the subsidized fertilizer.
The government withdrew the subsidy from fiscal year 1997-1998 saying that only farmers with connections benefited from it. “More than 80 percent of the total subsidized fertilizer used to be sold in Kathmandu Valley alone and per hector chemical fertilizer use in the outlying areas remained low,” added Sharma.
He said the government now has no such credible mechanism to prevent the repeat of past difficulties in the distribution of fertilizer.
This fiscal year the government is importing 32,500 tons of urea from India. But this amount is not going to provide any relief to the needy farmers. Farmers need huge quantities of fertilizer for the coming maize and paddy seasons.
Sharma suggested that the entire amount of subsidized fertilizer should be distributed to farmers in outlying areas, where majority of farmers are poor, to prevent possible misuse.
Also, the inadequate distribution network of the government is likely to hamper the distribution. The government-owned AICL has only 40 offices in 39 districts. “In some places we plan to distribute the fertilizer through co-operative firms,” said Gautam.
However, the track record of co-operatives is not good.
In the past the government had used them in the distribution system and the government-supported co-operatives did not pay dues amounting Rs 500 million to the government.
Farmers owning land 15 ropanis or less in the hills or four hectares or less in the tarai qualify for the subsidy. But officials say that under this criteria it will be difficult to ascertain which farmers are eligible.
Dr Hari Dahal, spokesperson of the Ministry of Agriculture and Co-operatives (MoAC) said prices of subsidized fertilizers will be fixed soon to pave the way for AICL to begin distribution. Prices of fertilizers here will be kept at least 25 percent higher than in India to prevent smuggling out of subsidized fertilizer.
The AICL has 700 tons of fertilizer in different godowns in addition to 5,500 tons received as assistance from KR Japan. The AICL has recently initiated the process for importing 12,500 tons of urea from India.
prabhakar@myrepublica.com
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