Chapter 6. Pakistan’s Fertilizer Sector: Structure, Policies, Performance, and Impacts

Ali, Mubarik; Ahmed, Faryal; Channa, Hira; Davies, Stephen; Spielman, David J.; Malik, Sohail J.; Dorosh, Paul A.; Ahmad, Nuzhat A.

doi:10.9783/9780812294217-009

Cited by 4 publications

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“…In 2013-14, the price of domestic urea was higher, even with the subsidy. Ali, et al (2015) conclude that the subsidy benefits only fertiliser companies, and is resulting in the misallocation of scarce natural gas.…”

Section: Subsidy To Fertiliser Manufacturersmentioning

confidence: 94%

“…The government of Pakistan has been following an import-substitution strategy for the fertiliser sector via what is effectively a subsidy to local fertiliser manufacturers: gas is provided to fertiliser producers as -feedstock‖ at prices substantially lower than what other sectors pay for gas (-fuel-stock‖). Ali, et al (2015) calculate the rupee value of this subsidy, and found that, in 2013-14, the loss to the government ballooned to Rs 48 billion (from Rs 6 billion in 2000-01). This sharp increase occurred due to the country's energy crisis and consequent increases in fuel prices (Table 3).…”

Section: Subsidy To Fertiliser Manufacturersmentioning

confidence: 99%

“…This loss is especially large when compared with the government's spending on agricultural R&D (estimated to be about Rs 8 billion in 2009 by ASTI-PARC 2012) and budget allocations for the ministry of national food security and research (Rs 5.5 billion in 2014-15). Ali, et al (2015) argue that, in recent years, this loss is not justifiable since 2009-10 when the international price of urea experienced sharp declines but the price of domestically produced urea increased consistently, while a severe energy shortfall arose in the country. Figure 4 shows these trends and the price of domestic urea if there were no subsidy.…”

Section: Subsidy To Fertiliser Manufacturersmentioning

confidence: 99%

“…Source : Ali, et al (2015) Note: Domestic price without subsidy is calculated by adding back the per unit subsidy to domestic prices.…”

Section: Fig 4 International Versus Domestic Urea Prices With and Withoutmentioning

confidence: 99%

“…Value of Subsidy to Fertiliser ProductionAli, et al (2015). Notes: * The production subsidy on fertiliser is calculated as the difference between fertiliser feedstock and fuel-stock prices per million British thermal units (MMBTU), multiplied by the amount of feedstock gas used by each firm and then aggregated for the sector.…”

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confidence: 99%

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Fiscal Space for Investment in Agriculture— A Review of Taxes and Subsidies in Agriculture in Pakistan

Davies¹,

Saeed²,

Moeen³

et al. 2022

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Despite agriculture’s importance in terms of its relationship to poverty and welfare of the poorest households, the government finds it increasingly difficult to find the fiscal space for budgetary allocations for agriculture and agricultural RD. We hypothesise that expansion of expenditures on agriculture is possible in the short to medium run with a combination of reallocations and new taxation. We argue that existing spending aimed towards the agriculture sector includes very large outlays on implicit subsidies that are largely unproductive. These costs include: subsidisation of gas for fertiliser plants, which approach Rs 48 billion in gas subsidies to fertiliser companies; the full costs of the infrastructure and operation and maintenance of the irrigation system, which amount to Rs 166 billion per year; and losses on wheat procurement, which have been about Rs 25 billion recently. On the taxation side, while agricultural producers are not currently liable to pay tax on income, they do however pay indirect taxes on agricultural inputs. Using a Social Accounting Matrix (SAM), we estimate agricultural producer pay about Rs 61 billion, mostly from GST taxes on fertiliser. Using a Computable General Equilibrium model, we show that agriculture could contribute further with an income tax on agricultural income. With a ―low-rate-widebase‖ income tax of 15 percent on non-poor, medium and large farms, as much as Rs 130 billion could be raised, enough to cover, for example, a sizable portion of the operation and maintenance cost of the irrigation system. JEL Classifications: D58, E16, H20, H22, H23, Q10 Keywords: Agriculture, Fiscal Policy, Subsidies, Taxation, General Equilibrium, Social Accounting Matrix, Pakistan

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Section: Subsidy To Fertiliser Manufacturersmentioning

confidence: 94%

Section: Subsidy To Fertiliser Manufacturersmentioning

confidence: 99%

Section: Subsidy To Fertiliser Manufacturersmentioning

confidence: 99%

“…Source : Ali, et al (2015) Note: Domestic price without subsidy is calculated by adding back the per unit subsidy to domestic prices.…”

Section: Fig 4 International Versus Domestic Urea Prices With and Withoutmentioning

confidence: 99%

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confidence: 99%

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Fiscal Space for Investment in Agriculture— A Review of Taxes and Subsidies in Agriculture in Pakistan

Davies¹,

Saeed²,

Moeen³

et al. 2022

pdr

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Soil quality evaluation for irrigated agroecological zones of Punjab, Pakistan: The Luenberger indicator approach

Sheikh,

Hailu,

Mugera

et al. 2024

Agricultural Economics

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This article describes the construction of the Luenberger soil quality indicator (SQI) using data on crop yield, non‐soil inputs, and soil profile from three irrigated agroecological zones of Punjab, Pakistan, namely, rice–wheat, maize–wheat–mix, and cotton–mix zones. Plot level data are used to construct a soil quality indicator by estimating directional distance functions within a data envelopment analysis (DEA) framework. We find that the SQI and crop yield relationships exhibit diminishing returns to improving soil quality levels. Using the constructed SQI values, we estimate linear regression models to generate weights that could be used directly to aggregate individual soil attributes into soil quality indicators without the necessity of fitting a frontier to the crop production data. For wheat and rice production, we find that SQI is most sensitive to changes in soil electrical conductivity (EC) and potassium (K). The SQI has direct relevance for site‐specific decision‐making problems where policymakers need to price land resources and conservation services to achieve agricultural and environmental goals.

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Agrarian change, populism, and a new farmers' movement in 21st century Pakistani Punjab

Aftab

Ali

2022

Journal of Agrarian Change

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Activists and scholars have debated whether “agrarian populisms” premised on multiple classes and groups can pursue progressive objectives if exploiters and exploited are in the same movements. In Pakistan, the militant Pakistan Kissan Ittehad emerged in 2012 by uniting different classes of owner‐cultivators who are largely not in direct relations of exploitation with each other. We argue that the PKI nevertheless advances the interests of a “second tier” of rural capitalists, who exploit rural labourers, while underplaying the interests of owner‐peasant farmers. This divergence of interests has contributed to the fragmentation of PKI along class and political lines, including attempts by peasant farmers to independently organize around issues particular to them. We suggest that progressive agrarian populism must hinge on the interests of rural labourers and peasant farmers and that second‐tier capitalist farmers may be tactical allies as they oppose neoliberal globalization. However, rural labourers and peasants are ideologically and organizationally weak, and thus, the possibility of left‐wing agrarian populism requires much legwork.

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Chapter 6. Pakistan’s Fertilizer Sector: Structure, Policies, Performance, and Impacts

Cited by 4 publications

References 0 publications

Fiscal Space for Investment in Agriculture— A Review of Taxes and Subsidies in Agriculture in Pakistan

Fiscal Space for Investment in Agriculture— A Review of Taxes and Subsidies in Agriculture in Pakistan

Soil quality evaluation for irrigated agroecological zones of Punjab, Pakistan: The Luenberger indicator approach

Agrarian change, populism, and a new farmers' movement in 21st century Pakistani Punjab

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