Engineer Pirne’mati, deputy managing director of Iran Tractor Manufacturing Co. for marketing and sales affairs names fail of on-time allocation of subsidies, failure in allocation of required subsidies, unfixed state of price of raw materials during the year, and failure in issuing permission for exporting the subsidy commodities as some of the problems of the producers of the agricultural machines.
He says that the subsidy required for his company in the next year is $163m, while this year the allocated subsidy has been $74m.
“Every year, the subsidy prices are announced at the end of the year instead of the beginning of the year, which imposes great harms on the productive units”, he added.
Unbalanced distribution of subsidies is among the problems forwarded by the private producers of the agricultural machines. A glance at the information on the subsidies distribution in 2003 indicates that out of $79m received by the mechanization center from the government over $58m subsidies has been allocated to Iran Tractor Manufacturing Co., $5.8m was allocated to Iran Combine Harvester Manufacturing Co., $2.3m was given to Jiroft Tractor Manufacturing Co., and $1.3m subsidies were allocated to Tractor Manufacturing Co. of Azarbaijan Industrial Development. The rest, about $11.5m has been deposited to the Bank Keshavarzi.
Although the subsidies have been distributed based on the factories’ capacities as well as the type and quality of their products, the producers who have not given subsidies believe that the distribution is not fair and it gradually withdraws them from the production cycle.
Salehi, the managing director of Sirjan Tractor Manufacturing Co. says that the government can support agricultural machinery producers only through giving subsidies.
“Sirjan Co. has not so far received any subsidy, as a result, all our contracts with the foreign companies on importing some of the parts and operating the production line have often been canceled”, he added, believing that if this trend continues, the investors prefer to withdraw from this sector and carry out other activities.
Certain experts are of the opinion that in
He also believes that due to insufficient contacts between the universities and the factories, the industrial units are not provided with the new knowledge and they cannot attain the skillful manpower, thus, they develop their work without having adequate knowledge.
He also said that sometimes certain governmental organizations ask the productive units to pay amounts of money on different pretexts such as holding celebrations and contamination of the green areas, as some of these units give about 30 percent of their production in this way.
Privatization and Free Competition
Since last years, the issue of decreasing the government’s monopoly and increasing the private sector’s participation in production and investment in different sectors with the express intention of the economic boost has been forwarded.
In this regard, the government’s role to prevent overlapping the private sector’s interests with the national ones is essential. And now the question is whether proper grounds have been paved for the investment and increase of participation of the private sector in developing the agricultural mechanization.
Dr. Tabatabaiifar is of the opinion that presently the ground has not been paved for free competition in the arena of the agricultural mechanization, since the government is seriously interfering in this issue as well as in allocating the facilities.
He considers the current conditions of the administrative system as the reason or government’s interference, stating, “Today, in the administrative systems, the expertise tools have been turned into financial ones, while, privatization of the agricultural mechanization restricts activities of many of the ministries in production and exportation.”
Pointing out to import of 1500 heavy tractors, he said that the mechanization center has imported these machines without negotiating with the university, the research center and the producers, then it is concluded that the governmental sector makes the final decisions.
Engineer Marandi, who stresses shift from governmental economy to private one, says the grounds for the competitive market should be paved meant to cancel financial and information rente and equally distribute facilities among producers coupled with providing the security investment. At these conditions, the private sector will find that there is no discrimination among producers and will enter the production cycle.
Consequences
Using dilapidated agricultural machines and tools or applying the traditional methods will have consequences, which impose damages on the agriculture sector in the long-term.
Engineer Marandi considers high cost for repairing and maintaining dilapidated machines, high level of energy consumption, and delay in carrying out the agricultural operations as consequences of using the dilapidates machined in the agriculture sector.
He says that due to using the old combines, the wastage of products increase even by 5 to 6 percent, while in other parts of the world, the wastage of products above 1 percent is not acceptable.
Strategies
Definitely, resolving the current crisis in the agricultural mechanization and achieving the sustainable development in this sector requires all-out development in social, economic, political and cultural fields. Thus, this complicated process requires determination of strategies, planning, adopting policies, and presenting precise plans with the cooperation of the genius researchers, specialized managers, and the experienced producers in the national arena not individuals or groups. Therefore, regarding harms imposed on the agriculture sector due to underdevelopment in the mechanization, evaluation of different strategies is essential and the changes and improvements should be launched as soon as possible.
Dr. Tabatabaiifar suggests that collecting information and statistics about the quality and quantity of the agricultural machines, networking the system from the production stage to the consumption stage, the regular establishment of the regional repair houses, and giving the agricultural machines to the farmers in the form of trust are some of the strategies of developing the agricultural mechanization.
An official in the Faculty of Agriculture considers the production through cooperation with the valid foreign producers as positive, stating that for such participation, the methods of conveying technology should be evaluated and the wise decisions should be made by conducting precise studies.
Increasing quality of the crops as well as the after-sales services, supervision on production and the production line, due attention to designing and manufacturing the machines, the costumer-orientation, job generation, decreasing the environment contamination, the on-time delivering of the commodities, and gaining the experiences are among the advantages of this cooperation.
Engineer Marandi believes that the subsidies should be only paid to the farmers to improve their financial wellbeing in order to thereby increase the demands for the agricultural machines and tools.
Meanwhile, he noted that the Agricultural Jihad Ministry should not give the subsidies to the farmers for specific machines, because it will cause the farmers to purchase a specific machine. Thus, conditions should be prepared in which the farmers select the right machines based on their requirements.
Engineer Pirne’mati is of the belief that manufacturing the agricultural machines should be free in order to facilitate the production and supply of these machines.
Salehi suggests the allocation of subsidies is halted and instead they are allocated to the agricultural products. Additionally, like the foreign countries, the bank interests on the loans granted to the farmers are reduced and the low-interest loans are given to them.
The majority of the experts advocate the belief that the farmers’ knowledge on using the agricultural machines, as well as the issues of plantation, caring and harvesting should be increased. Furthermore, they stress increase of the technical knowledge of the students and the specialists as well as employing them in the productive units.
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