Over the last three years, Pakistan’s agriculture sector has witnessed two important developments.

The electricity tariff for agricultural tube wells, including taxes and charges, has skyrocketed from Rs11 to Rs44 per unit kilowatt-hour (kWh), while the cost of solar panels has plummeted from Rs130 to Rs35 per watt. These changes have accelerated the widespread adoption of solar-powered tubewells across the country.

Contrary to expectations, the federal budget 2024 maintained tax exemptions on the imports of solar panels, while essential products like pharmaceuticals, infant formula, and other food items were subjected to an 18 per cent sales tax. As a result, the prices of solar panels have continued to decline since the budget’s announcement, which has further quickened the transition.

With the recent price reduction, converting an existing tube well to solar power now costs approximately Rs0.75 million to Rs2m for a 10 to 30-kilowatt system. While this remains a considerable investment for small and medium-sized farmers, the steep rise in electricity tariffs has shortened its payback period to just two to two and a half years, making it a highly attractive option for farmers.

This transition to solar energy is not only justified but also commendable as it provides a clean and sustainable alternative to diesel-powered tubewells and grid electricity, which is predominantly generated from fossil fuels like coal, gas, or diesel — the largest contributors to global warming and climate change. Additionally, this shift will help reduce fuel imports, which is crucial for addressing Pakistan’s massive trade deficit.

Lower cost of pumping water could lead to indiscriminate........

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