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Agriculture’s share in GDP drops amid lack of govt support

HM Murtuza | Published: 00:20, Jun 15,2019

 
 

A file photo shows farmers threshing paddy on the outskirts of Dhaka. Growth rate of the agriculture sector and its contribution to the country’s economy have dropped amid lack of government support and initiative for modernising the sector. — New Age photo

Growth rate of the agriculture sector and its contribution to the country’s economy have dropped amid lack of government support and initiative for modernising the sector.

Negligence to the sector would affect employment of the country’s 45 per cent population as well as government’s development goals including achieving 8.2 per cent GDP growth and sustainable development goals, ASM Golam Hafeez,  professor of agricultural finance at Bangladesh Agricultural University, told New Age.

According to the Bangladesh Economic Survey-2019 published on Thursday, growth rate of the agricultural production was 2.58 per cent in the outgoing fiscal year 2018-19, 0.87 percentage points lower than the 3.47 per cent growth in the FY18.

Besides, contribution of the agriculture sector to the country’s gross domestic product dropped by 0.56 percentage points to 10.11 per cent in FY19 from 10.67 per cent in FY18.

The share of agriculture has declined due to the high growth of industry sector, but the importance of the sector was broad in the economy, said ASM Golam Hafeez.

Asked about the mechanisation of the agriculture sector, Hafeez said farmers would be encouraged if the production cost could be reduced by using modern equipment.

Finding the government’s support for the mechanisation inadequate, the BAU professor said that the existing allocation for modern equipment procurement even did not reach to the real farmers.

Sector-wise adequate incentives and policy support could help boosting production by many folds and that would ultimately support enhancing the country’s export earnings, he said.

For instance, tonnes of Pineapple were being wasted every year in absence of proper cold storage facility, the BAU professor said, adding that the country could have earned significant amount of foreign currency if food processing facility were available.

However, the allocation proposed for the agriculture sector in the national budget for fiscal 2019-20 was less in percentage terms compared to the allocation for the outgoing financial year.

In the outgoing fiscal, 5.7 per cent of the total budget was kept for agriculture sector compared to 5.4 per cent for the next financial year.

But in volume terms, the government proposed to increase the allocation to the agriculture sector to Tk 28,355 crore for the next fiscal up from the outgoing fiscal’s Tk 26,259 crore.

Finance minister AHM Mustafa Kamal in the budget for the FY20, proposed Tk 14, 053 crore for the  agriculture ministry, Tk 2,932 crore for the  fisheries and livestock ministry, Tk 1,495 crore for the environment and forests ministry, Tk 1,943 crore for the land ministry and Tk 7,932 crore for the water resources ministry.

The agricultural production in the FY19 increased to Tk 1,07,392 crore from Tk 1,04,688 crore in a year ago.

Share of agriculture sector in GDP has been declining years. In FY06, the share was 15.33 per cent and that has dropped to 11.12 per cent in FY17.

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