Today, the federal government announced the 2024-2025 budget. The announcement was made by the Federal Minister of Finance. Pakistan’s agriculture sector had expectations from the government for some supportive measures, particularly for making phosphatic fertilizers more affordable. We were expecting measures similar to those for nitrogen fertilizers, which are exempt from GST. The All Pakistan Fertilizer Dealers Association was hoping that the government would remove GST from DAP fertilizers as well, and also remove FED to ease the burden on farmers who are already facing numerous problems, thus supporting agriculture.
However, in the budget announced by the Finance Minister Mr. Aurangzeb, GST on DAP fertilizers has been continued, and an additional Fed 5% remain intact This move did not meet our expectations of making DAP and other phosphatic fertilizers affordable for farmers.
We had expectations that, considering the current year, the price of wheat crops for farmers has crashed, and wheat farmers are facing problems. Similarly, farmers haven’t achieved good results with other crops either. So, both agriculture and farmers are currently in trouble. We expected support measures in the budget, specifically the removal of GST and FED on DAP fertilizers to make them affordable for farmers.
We have observed that the use of phosphatic fertilizers is continuously decreasing among farmers. Currently, around 6.8 million tons of urea are being used in Pakistan, whereas only 1.6 million tons of phosphatic fertilizers, especially DAP, are being used. This means that approximately four and a half bags of urea are being used for every one bag of DAP, which is very abnormal. The government should lower the prices of DAP, particularly by removing import duties and taxes, to promote balanced use of urea fertilizers. This would make DAP more affordable and encourage farmers to use it.
