Agriculture Minister Yeshey Penjor

Government will no longer provide subsidies and will instead implement a cost-sharing mechanism says Agriculture Minister

During the question and answer hour session at the National Council (NC) yesterday, the NC member from Sarpang, Anand Rai asked three questions to the Agriculture Minister, Yeshey Penjor on what support the Ministry of Agriculture and Forests (MoAF) provides to the farmers, so that they do not lose their investment and livelihood; if MoAF can support the marketing of eggs and meat items through the BLDC or implement a buyback scheme; and if it is possible for the Royal Government to provide a subsidy for poultry feed so that farmers are protected from fluctuations in feed price.

The Agriculture Minister said that when individuals learn that the government would aid with a loan to establish a business, they just take the loan since the government is assisting with the fund, but they do not do the plan and design and start the business, which leads to complications.

“Sarpang, Tsirang, Paro and Haa started the poultry and piggery business without strategy or research, and now they are experiencing challenges. When we conducted a survey, there was no planning or designing, and there was no coordination. Farmers are not cooperating with one another. They exclusively express worries about themselves, not in groups,” Lyonpo said.

Lyonpo stated that the ministry has asked the Bhutan Chamber of Commerce & Industry (BCCI) President to study the situation while on tour. “The BCCI President conducted the assessment, and came here to say that a discussion is needed, so we held a meeting last week and met with farmers in commercial farming in poultry and piggery and had discussions. I informed the farmers at the time that there is no planning, designing, or coordination, and they accepted it,” Lyonpo said.

In alliance with BCCI, the dzongkhags were asked to form an association and appoint a representative from the meat industry, a representative from BCCI, BAFRA, and DAMC, and to form an association and discuss pricing and how they will set the market price for each dzongkhag, and how the prices will be in the city so that the market can run smoothly. The ministry has asked them to come up with a strategy, which would benefit and aid everyone.

Lyonpo said that buyback was there from the second government, in which the government purchased products that were unsold, in order to help farmers, avoid losses. However, because farmers are selling at a lower price to the government, it does not provide much profit to the farmer.

“The government is unable to market it since the product is soon to be ruined and purchased by the government. The government will incur a total loss. So, with that in mind, we have devised the incentive-based production system, in which the government would establish the price for the produce and declare and offer individuals the option of selling to the government or to others where they will fetch a decent price. They are able to do so. It is applicable to both agricultural and livestock products,” Lyonpo said.

Lyonpo said, “The BLDC cannot assist those who are unable to sell their products. SOEs are created to be a model for new ideas and technologies. As a result, the people will devise their own business strategies in order to profit, and gain knowledge. BLDC’s responsibility is to set an example.   Since BLDC is at a growing stage, they are taking the temporary measures and buying eggs and meat from the farmers and improve the quality and sell and make profits.”

Lyonpo said that feeds should be produced in the country, with maize, wheat, etc., being the key ingredients. All of these are grown in the nation.

Karma Feeds began the company after understanding the advantages, and many firms now import the feeds. The government has permitted imports, as long as the quality is good since there would be no monopoly company, and the ministry has also encouraged the private sector to start producing, and the government will assist with funds.

According to Lyonpo, since the maize and wheat are used in producing feeds, having a large number of feed providers will encourage farmers to grow and market maize and wheat grown in their fields.

Lyonpo added, “The ministry has informed the Cabinet that we will not take the subsidies. Instead of subsidies, we have set up a cost-sharing mechanism through which a farmer or the private sector can purchase any equipment for starting a business. The government will invest some money, and the farmer will invest some money as well. The production is not big because of the subsidies and subsistence farming perception, so the objective is to transition to commercial farming and a cost-sharing mechanism.”

While the government has not provided subsidies it has engaged in massive buyback schemes for cabbage, ginger, cardamom and other crops over the years that would run into hundreds of millions mainly due to trade issues with India or the inability to export them.

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