Swelling edible oil import bill!

| | No Comments

THE REGULARLY slash in agriculture yields has sprung a wave of concern for the authorities concerned on one hand, while the other hand regular swelling of annual import bill of edible oils is equally responsible for multiplying the governments economic concerns especially for the consumers who are ultimately the sufferers. Presently, Pakistan imports two million tons edible oils in addition to more oilseeds for crushing purpose involving a huge amount of Rs 45 billion to meet the domestic needs, which the cash-strapped government, of course, finds it hard to pay out of the national kitty. The local oilseed production could meet the only 25 per cent requirements while 75 per cent oil seed is imported for the purpose. According to experts, these fluctuations are due to the indigenous marketing, low support price and high cost of production, which is making these crops non-profitable to local farmers. Being an agrarian state, Pakistan can save over $2 billion annually by encouraging domestic edible oil sector. However, contrarily, this dream is not being materialized mainly due to these multiple factors. The burgeoning prices of edible oils in the international market and increase in local demand remain the main contributing factors in the import rise. In the past whenever prices of imported edible oil rose substantially in the international market, the custom duty was immediately reduced proportionately so as to avoid further burden on the public. But this has not been practised by the government to give relief to the common man due to its own financial reasons, though the prices of palm products had touched an all-time low in 2008. Proper farming, production, processing and marketing of oilseeds can not only reduce dependence on imports but also help earn foreign exchange as Pakistan is located in the food deficient region. The reasons behind the wide gap between production and consumption includes lack of research and development initiatives, want of incentives, failure to attract investments, low price and high cost of production making these crops non-profitable to many farmers. Agriculture is the single largest sector of Pakistans economy, which accounts for 22 per cent of GDP and employs half of the labour force but faces problems like low productivity and limited investment. Until and unless the government repriotitises this important sector, which is regularly eating up an enhanced financial allocations, the situation would continue to put heavy on the financial shoulders of the country. It simply needs to exploit its still unrealised yield potential and comparative advantage in the production of oil crops. The mechanized farming is need of the hour in order to improve output growth in addition to enhancing the efficiency of already installed oil extracting plants.


Short Link: https://www.technologytimes.pk/?p=8406