Council: A report by the Natural Resources and Environment Committee (NREC) of the National Council (NC) highlights issues plaguing the agriculture sector and offers recommendations to improve agricultural output.

Presenting the Review of Agriculture Policy report in the House yesterday, the committee’s chairman and Pemagatshel MP, Jigmi Rinzin said the agriculture sector has been the backbone of the economy until the establishment of the hydropower projects and the advent of the tourism industry. About 70 percent of the population lives in rural areas.

He said there are various legislations, polices and strategies in place to facilitate agriculture production. However, increase in imports of agriculture produce, numbers of gungtongs in the villages and reports of increasing fallow land in the dzongkhags have been some major concerns.

According to the NC, this could be because of lack of appropriate agriculture policies and strategies or problems in the implementation.

The 11th Plan recognises the role of the Renewable Natural Resources (RNR) sector to promote equitable development through enhancing rural prosperity and poverty alleviation. However, Jigmi Rinzin reported the sector’s growth was insufficient to address rural poverty, attain food security and to sustain overall economic growth.

Growth in agriculture has hovered between 0.85 to 2.41 percent in the last five years, which is less than in the secondary (3.06 – 12.48 percent) and tertiary (0.3 –  15.21 percent) sectors.

Agriculture’s share of GDP decreased from 24 percent in 2004 to 16 percent in 2013.

Today, the sector employs 56.6 percent (192,281 persons) of the labour force. “There are paradoxical reports of farm labour shortage when the nation is witnessing the highest youth unemployment in the country,” the committee chairman said.  Bhutan produced 280,620MT of cereals, vegetables, fruits and cardamom in 2004 and production increased to 419,782MT in 2007. However, production steadily declined to 284,616 MT in 2014.

The committee reported that the total agricultural area is only 2.93 percent of the country’s total land area. As per the National Land Commission, Bhutan has 448,165 acres of land under chuzhing and kamzhing available for cultivation.

The total land usage has gone up by 6.8 percent from 158,600 acres in 2004 to 169,439 acres in 2014. From the total available land of 488,165 acres for cultivation under chuzhing and kamzhing, only 37.8 percent is actually used for cultivation.

This leaves 62.2 percent or 278,726 acres of the land area unused. Utilisation of land has actually decreased from 2007 for both cereals and vegetables.

The existing policies implemented have not been instrumental in increasing crop production and land utilisation, the committee reported. Chuzhing cultivated for paddy production increased by 4.9 percent from 46,585 acres in 2004 to 48,873 in 2014.

However, the area of cultivation has again decreased from 2007 onwards when it was 67,564 acres. This again shows that a total of 26,865 acres, which is 35.5 percent of the chuzhing available, is not being used for paddy cultivation.

The committee reported that it was encouraging to note that paddy production has actually increased from 54,325MT in 2004 to 77,038MT in 2014 despite the decrease in area used for paddy cultivation. The report attributes this increase in yield to investment in irrigation, improvement of rice varieties and farm mechanisation.

As per Bhutan RNR Statistics 2015, as of 2013, about 92.4 percent of the total irrigation channels, which are 2,583km, were found to be functional.

However, there is no reliable water source for irrigation as most of the water is tapped from temporary sources like rain-fed streams. There is also no large-scale rainwater harvesting and water-pumping technology initiated.

The committee reported that it was encouraging that vegetable production is more than sufficient, with 104 percent self-sufficient in 2005 and 106 percent in 2014. However, production is substantially seasonal from June to November of the year.

For livestock, self-sufficiency was 86 percent in 2007 and had decreased to 71 percent in 2015. Except for eggs, only 50 percent of livestock product requirements – meat, fish, beef, pork, chevon and dairy – are met by domestic production.

While cabbage is available for sale at the Thimphu Centenary Farmers’ Market (CFM) throughout the year, records with FCB, Phuentsholing, show that cabbage is auctioned from June to December. There is no import of cabbage between June and December.

It was also found out that the price of local produce is higher than imported ones in CFM. The price differential ranges from 17 to 167 percent. “This price differential encourages consumers to prefer imported vegetables to local produce.”

The committee also reported that farmers have not been growing vegetables throughout the year while statistics support the possibility of year-round cultivation. The distinct climatic zones from sub-tropical to temperate and cold places is suitable for agriculture cultivation throughout the year, according to the committee.

“Vegetables that can be grown in the north during summer months can be grown in the south during winter months.” Therefore, the import of some of the vegetables can be avoided if our farmers grow vegetables throughout the year.

The production of eggs continued to increase since the government banned the import of eggs. Similarly, this year some of the vegetable items were temporarily banned from import into the country due to high content of pesticide residues in the vegetables. Recently import of seaweed was also banned.

Following these import bans, domestic production is expected to increase in coming months and years, just like the egg-scenario, the committee reported.

The crop insurance policy, which is under discussion with the Royal Insurance Corporation Limited (RICBL) to address crop damages, according to the committee, will enhance food production, accessibility and food stability.

Loss of agriculture land to rapid development and urbanisation has put pressure on agriculture land. About 2,000 acres of agriculture land was lost to non-agriculture purposes between 1998 to 2008. This is likely to increase in the future with increased development activities.

Agriculture is the single largest sector that provides livelihoods to 56.7 percent of the population. The budget outlay for the sector was 6.2 percent in the first Plan. This increased to 38.9 percent in the fourth Plan.

However, since then the sector’s share of the Plan outlay has been decreasing. The sector received 6.4 percent in the 11th Plan.

The committee reported that there is a need to further review increasing the Plan outlay allocations to the agriculture sector. “It is very clear that an employment criterion was not considered while making the resource allocations among the sectors in addition to the revenue.”

Investments in the agriculture sector from financial institutions are minuscule, although it has increased over the past successive years. Credit to agriculture, in absolute figures, is also growing from year to year.

To ensure credit growth in the agriculture sector, there is no mandate from the regulatory authority that would require the financial institutes to allocate credit facilities to the agriculture sector.

MB Subba