"Benefits from subsidies go to oligarchic officials"

Baku//12.04.23/ In Azerbaijan, the mechanism for subsidising cotton production is having no effect. According to the Chamber of Accounts, the total cotton subsidy paid grew by 59.7 per cent to AZN 47.1 million in 2020 and by 82 per cent to AZN 53.7 million in 2021 as compared to 2019. However, yields in 2021 fell by 3.4 per cent and 14.9 per cent respectively as compared to the appropriate figures of the previous two years, to 28.5 centners per hectare.

According to the report, production has also declined. Countrywide production in 2021 was 287,000 tonnes. As compared to the two previous years, it was down by 2.8 and 14.8 per cent respectively: "This also indicates a lack of efficiency development through resources channeled to this area."

The Ministry of Agriculture told Turan that in 2022 during the cotton season 322.300 tons of harvest was collected from the fields and delivered to the points of supply: "The average yield made up 30.92 centners/hectare. More than 100.000 hectares of cotton were sown in the country in the completed season.  Although compared to the 2021 season the volume of sown area has not changed, 35,259 tons more has been harvested from the fields. And the overall yield rose by 2.42 cwt/ha as compared to the previous year.

The Ministry added that in 2022 the purchasing price of raw cotton by companies rose twice by 50 manats in January and August: "If in 2022 1 ton of cotton of the first grade was bought from farmers for AZN 700, then for 1 ton of cotton of the same grade supplied this year it is paid AZN 800 to farmers.

Vahid Magerramov, an expert on agriculture, told "Radio Azadlig" that previously the subsidy was given according to the area, so they tried to specify a large number of cotton fields: "Now the mechanism for giving subsidies for finished products, which we proposed many years ago, has been introduced. But at the same time it is no longer possible to raise productivity. And there are several reasons for this."

The expert believes that lack of water is one of them: "In addition, our farmers complain that they are not provided with machinery in time, sowing work is not done in optimal time. There are not timely plant care works, this is also due to lack of machinery.  There are also problems with harvesting. Despite the fact that 500 harvesters have been brought, harvesting is not done in optimal time, it is delayed.

The economist said farmers are being deceived because of complaints about the delivery of cotton: "They are showing that the moisture content is high and that there is more litter in the cotton. It is getting to the point where 60 per cent of the crop is treated as damp and rubbish.

According to Magerramov, it is not the farmers who get the subsidy but the oligarchic officials: "These are the ones who process and export cotton. They have to buy cotton from farmers at a higher price because cotton prices are high on the world market. These officials buy the product cheaply and sell it dearly. The state helps them here too, subsidises them. The authorities are interested in cotton production because ultimately the oligarchs are the buyers and exporters of this product".

There is no need for subsidies at all, he said. "They should buy cotton supplied by farmers at a good and profitable price for the farmer. At present, the price is determined by the officials of the oligarchs together with the government.  This is contrary to the market economy. How can the buyer determine the price?".

The expert thinks that farmers can unite, process and sell their products on their own: "The government can help them by providing them with cheap credit so that they can set up a processing plant. Then the farmers will be more interested in yields."

It has not been possible to talk to the management of the cotton supply and processing companies about the thoughts outlined in the article.-0-