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Policy Instruments for Reducing Nitrogen Fertilizer Based Emission: Under Policy Conflict of Self Sufficiency of Food Versus Sustainable Management of Agriculture

Huda FA*
Department of Agricultural Economics, Bangladesh Agricultural University, Mymensingh-2202, Bangladesh

Khan MA
Associate Professor, Department of Agricultural Finance, Bangladesh Agricultural University, Mymensingh-2202, Bangladesh

Abstract/ Executive Summary:

The paper discusses an alternative policy instrument to reduce nitrogen fertilizer based emission in agriculture compared to existing fertilizer subsidy for food self-sufficiency policy. The relative efficiency of fertilizer subsidy policy assessed in terms of budgeting resources and sustainable management of agriculture. It concern of nitrogen leaching and other related atmospheric emission control as climate change adaptation. An analytical framework of ex-post evaluation is developed to access the alternative incentive policies instead of fertilizer subsidy in Bangladesh, which may control emission. It observes the preliminary phase fertilizer subsidy policy efficiently contribute to increase food production. Using partial equilibrium analysis marginal productivity of fertilizer found zero or even negative. Although distributional implication of inputs subsidy is quite high but over doses of cheap fertilization seriously emit the air as well as hampers water quality and soil. Finally, the implication of results suggests that for any kind of reduction or control in nitrogen fertilizer based emission from agriculture, this policy planner could explore the direct incentives programme instead of subsidized fertilizer any more. The existing subsidy policies contribute to use more than optimum level of fertilizer use especially nitrogen-based fertilizer.

Keywords: Policy instruments, Sustainable management, Nitrogen emission, Ex-post evaluation, Subsidy, Climate change

Location:

Start Date:

End Date:

Program Area: Socio-economic and Policy

Non-commodity: Performance

Objectives:

In the present circumstances, what is the optimum solution under policy conflict of self-sufficiency of food and emission reduction through urea use controlled? The paper would try to find answer by an ex-entry evaluation of available policy instruments in Bangladesh.

Methodology:

A desk research had been carried out for assessing current nitrogen fertilizer based emission from existing subsidy and self-sufficiency of food policy. Based on published and unpublished data of IPCC, FAO as well as food and agricultural policy documents of Bangladesh were used to analyze the research objectives of the study. The alternative policy options oppose to input subsidy policy evaluated by partial equilibrium analysis is a major focus of the research. Which includes the rationale and systematic analysis of subsidy policy for be validated or refuted in the ground of sustainable use of fertilizer and agrochemicals. In economic point of view any policy options could be optimize according to objective function and constraints. If government objective function to optimize production of rice with budgetary constraint, then the least coast combination of inputs that give the highest possible utility is an optimum point. In case of farm level resource use decision optimum use of input could be determine from value product function by using partial derivatives. The resource will be optimum when the marginal value product will be equal to price of the resource. When an intervention of government by subsidizing inputs occurred that the optimum resource use will be optimum at the wasteful use. But if the input price truly reflect in the market than resource use optimum becomes efficient. By the partial equilibrium analysis of the policy option the efficient policy instrument can be chose. The present study aim to evaluate efficient policy instruments for nitrogen fertilizer based emission at Bangladesh case. The discussion of input subsidy policy consists of a number of subsections; these are as follows, discussion of the recent trend of fertilizer subsidy, investigation of rationale for subsidy and deals with the issue of justification of subsidy. In addition to this an ex-ante evaluation of some successful regional and international policy instruments that aiming at control nitrogen based fertilizer use under the perspective of Bangladesh. The following policy instruments have been analyzed qualitatively. Basically, logic behind the fertilized subsidy is intervention to prevent world market price fluctuation of fertilizer and encouraged production by low price input. There is more efficient way of giving incentive through direct compensation payment for volatile price or by assistant card of rationing fertilizer according to area allocation to crop. Introduction of certification system as well as incentive for Fertilizer Best Management Practice (FBMP) of climate change adapted farms. Regulations are imposed for fixing nitrogen vulnerable zone and ceiling of nitrogen per hectare application. Provision of enhancing knowledge based through extension. Finally the study-analyzed feasibility of proposes policy instruments under the policy goal of self-sufficiency. It also assumes that the policy combination will fully implemented without penetration and adoption measure in the practice.

Source of Information: J Earth Sci Clim Change, Volume 5, Issue 6, 1000207, ISSN:2157-7617 JESCC, an open access journal

Article Link (Online Journal): http://www.omicsonline.org/open-access/policy-instruments-for-reducing-nitrogen-fertilizer-based-emission-under-policy-conflict-of-self-sufficiency-of-food-versus-sustainable-management-of-agriculture-2157-7617.1000207.pdf

Funding Source:

Budget:

Total Budget (Tk.) :

Achievement/Findings:

After 1992 when an environmental policy significantly appeared, the instrument of fertilizer subsidy went through a critical evaluation. Anyhow the country should reduce CH₄ and N₂O emission from rice farming by nitrogen fertilizer use controlled. The policy instruments must be an integrated approached by combining market based and crop and soil management practice implementation through extension. Because of developing countries have food sufficiency policy goal. The first and foremost steps to do this are withdrawal of urea subsidy and ensure best fertilizer management practice. The subsidy withdrawal policy will helps to reduce wasteful use of resources as the raw material of the urea are natural gas and improve environmental quality of agricultural land, surface emission by CH₄ and underground water from nitrogen leaching problem. The abolishment of the fertilizer subsidy will create some problem of food security goal but in long run the benefit of good soil health helps to sustain production. The policy mix of economic, regulatory and knowledge base development will help to target oriented incentive to food policy and environmental policy for poverty reduction. The most of policy study relating to fertilizer subsidy withdrawal is always starting with good economics rationality of efficiency ground. But at the end they are try to have conclusion on the favor of subsidy that mentioning the distributional aspect of humanitarian ground of subsistence farming survival issue. Sometime inconclusive to the decision of sustain environment and food security or some sort of compromise with nitrogen fertilizer based emission. The well co-ordinate combination of policy instruments mention in the paper should carefully implement.

Knowledge Management: Journal