Switch to padi output subsidies in the works

 

Mohamad Sabu trying his hand at transplanting padi last month. He told the Dewan Rakyat today of plans to change padi subsidies. (Bernama pic)

PETALING JAYA: The agriculture and food security ministry is looking to shift the padi subsidy system to one that is based on farmers’ output, in order to increase productivity, the minister, Mohamad Sabu, told the Dewan Rakyat.

He said the government spent nearly RM1 billion on input subsidies for padi farmers in 2022, offsetting 60% of farmers’ production costs by subsidising padi seeds, fertiliser, pesticides, lime and ploughs.

The amount was part of RM1.5 billion allocated for input and output subsidies last year. For this year, a total of RM1.86 billion has been allocated, a 21.9% increase from 2022.

“In the long-term, the ministry plans to implement a transition from input subsidies to output subsidies to encourage farmers to increase padi production. This will gradually establish a self-regulated industry that will see less government involvement and oversight in the rice production chain,” he said in a written reply to Dr Ahmad Yunus Hairi (PN-Kuala Langat).

Yunus had asked the minister to state the government’s long-term plans to safeguard Malaysia’s food security.

In 2020, Khazanah Research Institute recommended a shift to output subsidies, which are tied to farmers’ productivity, coupled with research and development to improve padi yield and reduce production costs for farmers.

The think tank added that the future of padi and rice production hangs on better research rather than on subsidies.

Mohamad also said the ministry has carried out pilot “smart farm” projects, making use of technology such as drones, and is working with research institutions and universities. - FMT