Subsidising business, depriving farmers

by Farida Akhter | Published: 00:00, Jun 16,2020



THE budget for the fiscal year 2020–21 was announced amid the COVID-19 outbreak with rising number of detections and deaths. The infections are constantly rising and showing no sign of flattening the curve. The situation is alarming. Lives are posed against livelihood since both could be fatal after a ‘general holiday’, the Bangladesh version of a lockdown accompanied by shutdown of public transports for over 60 days. It has already affected the livelihood of a huge number of people including the farmers. People are desperate to go out for work defying the stay-at-home directive given as a protection against the transmission of the virus. In this context, the budget of 2020–21 must reflect well-planned actions to address the problems arising out of the COVID-19 crisis both at national and global levels. However, looking at the budget allocation for the agriculture sector, one has to be disappointed because of unrealistic allocations and negligence towards the needs of farmers.

Agriculture is a way of life and livelihood for a large rural population of the country. Although there is a gradual reduction in the contribution of agriculture sector to the GDP from 38 per cent in 1990 to about 14 per cent in 2018, the sector remains the main backbone of our economy in terms of food production, employment and livelihood. It creates employment for 45 per cent of the total population and more than 80 per cent people are indirectly dependent on this sector. However, the agriculture sector always faced the lack of attention of policy makers. Therefore, the government’s decisions most of the time prove to be detrimental for the greater interest of farmers that actually implies the interest of the nation. Policy makers are blind and could hardly see the human faces behind this sector when they take decisions. More than 84 per cent of the 15 million farm holdings are small scale farmers owning less than 2.5 acres of land. Unfortunately, during budget preparations, their interests are forgotten. Time and again, it happened with the national budget for the agricultural sector. In the context of COVID-19, when livelihoods are already threatened, these people are left with the choice of dying of COVID-19 or hunger.

Meanwhile, the United Nations has warned that the world stands on the brink of a food crisis worse than any seen for at least 50 years. It urged governments to act swiftly to avoid disaster. In a report published in The Guardian on June 9, 2020, the UN secretary general, António Guterres has said that ‘unless immediate action is taken, it is increasingly clear that there is an impending global food emergency that could have long-term impacts on hundreds of millions of children and adults’.

The situation of the growing food crisis is also found in a Food and Agricultural Organisation report on rapid assessment of food and nutrition security in the context of COVID-19 in Bangladesh. The prices of rice and lentil have increased significantly, which has serious implications for food security as these are the staples and most preferred foods across the country. With the same amount of money, consumers are currently getting 20 per cent less rice.

The prime minister’s address on April 18, 2020 contradicted the global concern. She said, ‘We’ve no scarcity of food and won’t have as well. But we should continue our agricultural production.’ She added that the government will provide farmers with loans at 4.0 per cent interest to continue production.

During the pandemic health and agriculture sectors have become the most crucial sectors for solving the life vs livelihood dilemma. For agriculture, there is acknowledgement in the budget speech that ‘our economy depends on agriculture and that despite industrial expansion and extensive development in IT sector, around 45 per cent of the total population of this country still depend on agriculture for their livelihood’. The allocation of Tk 22,849 crores for the agriculture sector has been made in the national budget for 2020–21 fiscal year, which is 5.3 per cent of the total budget. However, in the allocations of resources, small scale farmers hardly get any benefit. A big chunk of Tk 9500 crores is allocated for agricultural subsidies and an additional Tk 2000 crores for farm mechanisation.

Two refinancing schemes for the sector, with Tk 5000 crores agricultural credit to farmers and another Tk 3000 crores for small income farmers and traders have been proposed, but this is unrealistic as the majority of the farmers fail to meet the conditions for receiving credits from the banks. Their problems will not be solved by taking loans from the banks alone.

The government’s declaration of Tk 9500 crores subsidy on fertilisers and other inputs was made in April, but it will largely benefit the agribusiness companies and the rural elite, who are mostly the political constituency of the ruling party in power. It shows that the COVID-19 situation is creating a triangular alliance between agribusiness, rural elite and the rulers.

In April amid countrywide lockdown, boro farmers, who produce 55 per cent of the rice in the country, faced a tremendous shortage of labourers for harvesting. The prime minister instructed law enforcement agencies to ensure unhindered movement of agricultural labourers so that they could travel from different districts to the boro fields of the haor region. Later, the solution to the problem turned towards an increased use of combined harvester machines rather than bringing migrant farm labourers who were deprived of jobs and facing hunger. The government has taken up a Tk 3,198 crore project to promote farm mechanisation. This subsidy for mechanisation was actually used to bail out only a few agro-business companies. It created scope for agro-industries to sell their unsold combined harvesters. In 2019, they were able to sell only 40 combined harvester machines, but with the subsidy, it is projected that this number may exceed 1000 this year (Prothom Alo, April 29, 2020).

It has triggered a debate on agricultural mechanisation and appropriate policy for safeguarding environment and ecology. Environmentalists and agro-ecologists are concerned that mechanised harvesters are going to replace over eight million agricultural labourers who find seasonal work in the haor region, and that it will further damage already precarious environmental and agro-ecological conditions, affecting the livelihood of the rural population.

A UBINIG report on the COVID-19 situation in April showed that during the lockdown, farmers in the country suffered from the lack of access to markets to sell vegetables and thereby had lost income from their crops. The boro farmers faced a shortage of labourers, thereby had to pay higher prices. Yet, no allocation has been made for creating alternative marketing opportunities and labour-movement facilities during pandemics and other natural disasters. The restriction on vehicular movement without any effective alternative strategy to bring the agricultural produce to markets had devastating effects on the agricultural sector, particularly for farming households — a community that indeed feeds most of the population in the country.

The government must organise policy debates among stakeholders to determine the appropriate strategy of agricultural mechanisation. Such debate must take into account the major concerns such as labour displacement and unemployment as well as recovery of the damage already done to environment and agro-ecology.

While the immediate needs of farmers are overlooked, the finance minister mentions in the budget speech the establishment of agricultural industries and introduction of genetically modified technology which is totally against the interest of a biodiversity rich country like Bangladesh. Technology is not neutral and requires serious study and analysis to determine its impact on environment, agro-ecology and livelihood. Irresponsible mechanisation to serve industries and exposing Bangladesh to biological pollution is indeed a crime during the COVID-19 crisis. The government must stop subsidising major agro-machinery companies in the guise of helping farmers and must reckon with the challenge in the agricultural sector.

The government must also grasp the term ‘food sovereignty’ in contrast to the narrow idea of ‘food security’. Food sovereignty focuses on the decisive role of farming communities in deciding how and what food should be produced in order to feed the nation. Food security is the term of transnational companies. In a neo-liberal economic regime, it implies that ‘food’ is a commodity and profit should be secured for the companies and businesses, before the government ensures life and livelihood of the farming population. Food sovereignty is, therefore, integral to national sovereignty — the right of people to defend their biological and economic lives.


Farida Akhter is the executive director of UBINIG and organiser of Nayakrishi Andolon.

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