Government targets Sh1 trillion in fertiliser subsidy by 2025
Agriculture Minister Hussein Bashe speaks this during a recent event to celebrate President Hassan's achievements in the sector since assuming office in March 2021. PHOTO | AGRICULTURE MINISTRY
What you need to know:
- Bashe disclosed that last year alone, the government allocated over Sh250 billion towards the fertiliser scheme, with an additional Sh170 billion to Sh180 billion disbursed for subsidies in the current farming season.
Dar es Salaam. In a bid to bolster agricultural productivity, President Samia Suluhu Hassan's administration in Tanzania has invested over Sh400 billion in fertiliser subsidies over the past three years.
Agriculture Minister Hussein Bashe revealed this during a recent event to celebrate President Hassan's achievements in the sector since assuming office in March 2021.
Bashe disclosed that last year alone, the government allocated over Sh250 billion towards the fertiliser scheme, with an additional Sh170 billion to Sh180 billion disbursed for subsidies in the current farming season.
The program is slated to conclude in the 2025/26 fiscal year, with a target expenditure of Sh1 trillion to support farmers and alleviate food crop production costs.
Under President Hassan's tenure, the government has revitalised the Tanzania Fertiliser Company Limited (TFC) by injecting Sh116 billion in capital, enabling the firm to operate efficiently.
TFC now stands as one of the top six fertiliser distribution companies, reaching farmers across 26 regions and 104 councils.
The minister highlighted the government's commitment to achieving 130 percent food self-sufficiency by 2025, with current levels already at 124 percent. Thanks to the fertiliser subsidy, food production has increased from 17 million metric tonnes in 2020/21 to 20 million metric tonnes in 2022/23, with a target of 30 million metric tonnes for the current season.
Furthermore, Bashe outlined the government's efforts to register and support Tanzanian farmers, with over four million already enrolled in the ongoing exercise targeting seven million crop producers.
The subsidy program covers 50 percent of fertiliser costs incurred by farmers, aiming to increase fertiliser uptake from below 15 kilograms per hectare to over 50 kilograms per hectare, in alignment with regional directives.
Recognising the importance of cash crops, such as cashew nuts and cotton, the government has extended subsidies to their production, allocating Sh180 billion and Sh190 billion respectively last year. Similar support has been extended to other crops like sunflower and tobacco, leading to significant increases in annual production.
Experts from the Tanzania Fertiliser Regulatory Agency (TFRA) foresee continued growth in the fertiliser industry, leveraging the country's strategic positioning and burgeoning markets within the East African Community (EAC) and the Southern African Development Community (SADC).
While local fertiliser manufacturing currently meets only a fraction of demand, the government has been actively encouraging local investment in the industry.
TFRA Executive Director Joel Laurent cited reliable markets, abundant raw materials, ongoing infrastructure development, and favorable government policies as key reasons for investors to consider Tanzania's fertiliser value chain.
With a focus on increasing food production, ensuring food security, and providing raw materials for local industries, the government has significantly boosted the agricultural sector's budget, reflecting its commitment to transforming the sector and driving economic growth.
Through partnerships and innovation, Tanzania is poised to harness its economic potential and foster sustainable agriculture for future generations.
