CPD, Brac for OMS of fertiliser | The Daily Star
12:00 AM, October 12, 2007 / LAST MODIFIED: 12:00 AM, October 12, 2007

Facing Post-flood Situation

CPD, Brac for OMS of fertiliser

CPD and Brac recommended open market sale of fertiliser, replacing the existing card system to tackle the post flood situation with increased production of rice.
The two organisations -- Centre for Policy Dialogue (CPD) and Bangladesh Rural Advancement Committee (Brac) -- made the recommendation in a press briefing at CPD office yesterday based on a survey conducted in some of the flood-affected areas.
If necessary, both CPD and Brac urged the government to raise fertiliser prices for sale on the open market and ensure sufficient supply of hybrid seeds for the farmers.
They recommended the government involve micro credit institutions for disbursing seasonal loans to the farmers.
About 9 lakh tonnes of rice have been damaged due to the recent floods, said Mahbub Hossain, executive director of Brac adding, We made some recommendations in light of farmers views in different flood affected districts so that damage of the yield of rice could be recovered in the next Boro season.
Addressing the press briefing, Debapriya Bhattacharya, outgoing executive director of CPD, said if the shortfall in Aman production is not recovered by an abundant production of Boro, the safety level of food stock will fall and that will create further inflationary pressures.
Mahbub Hossain of Brac read out the report of the survey that gathered views from farmers in most areas of seven flood-affected districts including Tangail, Sirajganj, Dhunot (Bogra), Gaibandha, Rangpur, Kurigram, and Lalmonirhat.
Majority of the farmers in these areas are anxious over the probable shortage of fertiliser in the next few months as the demand for fertiliser is likely to grow substantially by that time, Hossain said quoting the survey.
Most of the farmers surveyed preferred an open market system to the existing card system for purchasing fertiliser. Under the present distribution system, only 60 to 70 percent of their requirements are fulfilled, said the farmers.
"Farmers do not like the present system of fertiliser distribution through cards as it needs certification from representatives of the local government and the local level extension officials. They would like to get the fertiliser through an open market -- like the system that existed a few years ago," the report said.
To discourage smuggling, it would be appropriate to raise the price of urea to keep it even with that of Indian urea, recommended the report.
With this policy change, the government can afford to import more fertilisers to ensure adequate supply in the market, the report said adding that the farmers might not resent such a policy change if the moderate price increase is accompanied by its distribution through the open market.
The report anticipated a high demand for rice and maize seeds this year and recommended the government take a coordinated effort with the help of the private sector to meet the demand.
The report also anticipated a shortage in working capital in the flood-affected areas and urged the government to involve private sector banks along with specialised government banks for an enhanced inflow of credit into the rural areas.
The NGOs with micro credit facilities can play an effective role in this area. However, the usual practice of recovering the credit in weekly instalments, immediately after the disbursement, will not work in the case of agricultural loans, the report pointed out.
"The recent flood was highly localised and for those who have been affected, the damage has been severe. So, it might be better if the government identifies the affected unions (or villages if possible) and target all farm households in those unions for the rehabilitation programme," suggested the survey report.
Dr Uttam Deb, senior research fellow of CPD, was also present at the press conference.

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