The Economic and Finance Committee holds consultation meetings with the Ministry of Finance and Ministry of Agriculture and Livestock
The Economic and Finance Committee (EFC) held a consultation meeting with the Ministry of Finance (MoF) and the Ministry of Agriculture and Livestock (MoAL) today. The primary agenda was to understand the basis of the subsidy ratio of 60:40 as notified by the MoF, the position of the MoAL in implementing the subsidy scheme, and to find out the mutually agreeable subsidy scheme if the aforementioned scheme is found not favorable to implement it.
During the meeting, the Ministry of Finance presented the background and rationale of the notified cost-sharing model. Following the presentation, there was a thorough discussion on various aspects of the proposal. While, in general the rationale based on declining capital productivity is noted; nonetheless, members expressed concerns about the subsidy determined without prior consultation with the relevant stakeholders and without assessing the factors beyond productivity and cost efficiency such as poverty, social acceptability, and environmental viability. Both the Ministries apprised the house on the ongoing consultation on refining the subsidy scheme. Towards that, the members recommended to carry out indepth collaborative research considering both fiscal and technical aspects of subsidy to make it effective for all categories of farmers under varying socio-cultural and economic context on the ground.
The Economic and Finance Committee also suggested sharing the new subsidy scheme prior to formalization to understand the scheme properly; and accordingly inform the public for adoption and implementation. The discussions were centered on resource allocation, the equitable distribution of financial burdens, context based subsidy across the value chain ensuring long-term benefits for the sector, ultimately aiming to support farmers in a sustainable and effective manner. The committee also suggested exploring privatization of input supply assessing the technical capacity of private entrepreneurs.
