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Tk 500cr subsidy planned for diesel irrigation

REAZ AHMAD
The government will soon provide up to Tk 500 crore in subsidy to farmers using diesel-run pumps for irrigation, according to a recent decision of the cabinet committee on agriculture.
It will help the farmers using about eight lakh diesel pumps to cut production cost.
Currently, subsidy is given to farmers using electric pumps.
Dubbing the move as a first step toward further widening the scope of farm subsidy, Agriculture Minister MK Anwar yesterday explained to The Daily Star: "Currently, farmers using diesel pumps have to incur 30 per cent more cost compared to those using electric pumps."
"According to a preliminary
estimate, cash support of Tk 500 crore will be required to bridge the gap," said the agriculture minister, adding that 25 to 50 per cent of the subsidy would be disbursed in the current fiscal and the rest in the next fiscal.
The current budget envisages Tk 300 crore in subsidy -- Tk 200 crore
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on fertiliser and the rest on diesel pump-powered irrigation.
"We're hopeful of getting more than the allocated Tk 300 crore this fiscal and we'll go for the new cash support programme for farmers," Anwar said.
The decision on diesel subsidy was finalised at a cabinet committee meeting Monday, with Anwar in the chair, after the August 11 internal meeting of the agriculture ministry went for the move.
According to a survey by the Bangladesh Agricultural Development Corporation (BADC) last year, there are 82,253 power pumps and over 7,000 power deep tubewells to irrigate farmlands. The Department of Agriculture Extension (DAE) put the number of power pumps at 54,392.
The BADC survey says there are 865,213 diesel-run shallow tubewells and over 15,000 dieselrun deep tube wells.
"We would like to implement the decision without delay and are now working out the modalities to reach the cash support to the farmers," said Anwar.
State Minister for Agriculture Mirza Fakhrul Islam Alamgir told The Daily Star that the level of subsidy that Bangladesh provided to farmers was way below the subsidy level of the developed world.
The government will try to provide all support for the farmers and to protect the rights and interests of farmers of the least developed countries (LDCs) at the upcoming WTO Ministerial Meeting at Cancun next month, said Alamgir.
Official statistics say, Bangladesh provides farm subsidy at only 3.3 per cent of the aggregate value of its annual farm produces, although the WTO rules allow any country to extend the subsidy level up to 10 per cent.
An agriculture ministry official involved in Bangladesh's preparation for the Cancun meet said LDCs like Bangladesh do not fall under WTO bar on subsidy. The US and EU, the two highest farm subsidy providers, will have to commit subsidy cuts at Cancun.
The cabinet committee on agriculture that also reviewed recommendations of the Agriculture Commission formed during the Awami League rule emphasised taking the outcome of agricultural research from research institutions to farmers' fields and boosting yields.
The committee also recommended a reduction in the interest rates for farm loans in line with a finance ministry directive to the nationalised commercial banks to lower the interest rates from 13-14 per cent to 9-10 per cent.