Power, fertiliser subsidies not productive: Ahluwalia

Throwing his weight behind the growing clamour for a more rational subsidy regime, Planning Commission deputy chairman Montek Singh Ahluwalia said on Thursday that the amount being spent on power and fertiliser subsidies can be better utilised to improve agriculture infrastructure and raise farm productivity.

Public investment in the agriculture sector can be stepped up by diverting the electricity and fertiliser subsidies to this purpose, he said while inaugurating the 69th annual conference of the Indian Society of Agricultural Economics in Amritsar.

These funds, which run into thousands of crores of rupees, can be used to improve the quality of land, enhance availability of water and raise farm productivity, he said, adding that there was a pressing need to upgrade roads and extend various other services in rural areas.

Ahluwalia said that the 4 per cent growth rate in the agriculture sector envisaged in the 11th Plan (2007-12) can be achieved despite drought by improving the quality seeds and adopting scientific methods of farming. Use of biotechnology could double the agricultural output, he added.

The Plan panel chief also underlined the need for changing land laws to allow farmers to lease out land and quit agriculture for better opportunities.

The conference is being attended by 300 agriculture economists and policy-makers, besides ICRIER chairperson Isher Judge, Ahluwalia and government officials.