Analysis of Agricultural Achievements and Weakness of Pakistan
Module: Agriculture Economics
Introduction:
Pakistan came into existence in 1947. It is the second emerging economy in South Asia after
India. It is bordered on the west by Iran, on the north by Afghanistan, on the north east by
China, on the east and south east by India, and on the south by Arabian Sea. Pakistan has a
vast and rich natural resources as well as different climatic zones. Having various climatic
zones and rich natural resources the country has potential for producing all type of food
commodities. Pakistan divided into has four parts which are so-called provinces today. The
names of Pakistani’s provinces are Punjab, Balochistan, Sind and NWFP. The total land area
of Pakistan’s is 80 million hectares and its population is about 150 million. About 27 percent
of the area is under cultivation. About 80 percent of the cultivated area is irrigated while the
remaining area is drying farming. So in the content of irrigated cropped area Pakistan is on
the top of the world list. With an annual growth rate of 0.9 percent, the cultivated area
increased from 16.62 million hectares to 33.63million hectares during 1970-71 to 2007-08.
During the same period, the population also increased from 65 million to 165 million. In
consequence the per capita land availability decreased from 0.25 hectares in 1970-71 to 0.15
hectares in 2007-08.
Agriculture is the lifeline of Pakistan’s economy. The contribution of the
agriculture sector to gross domestic product (GDP) is 21 percent as well as employs 48.8
percent of the total labour force. Agriculture contributes less to the national GDP relative to
its size of population and labour force compared to other sectors of the economy. Limited
information and understanding of the rural markets and economy has been one of the key
impediments in penetration of banking & finance in agriculture rural sector of our economy.
It also plays a vital role to earning foreign exchange. About 70 percent of foreign exchange is
earned through export of raw materials; semi processed and processed agriculture products.
About 68 percent of the country’s population live in rural areas and are directly linked with
agriculture sector for their livelihood. During the decade of the 1990s the agriculture grew at
4.5% per annum averagely. The highest growth rate of 11.7% was achieved in 1995-96 due
to increased in cotton, gram, milk and meat products. The lowest negative growth rate was
5.3% in 1992-93 by dint of decrease in cotton and sugarcane production which are the major
crops of the country.
There are two principal crops seasons in Pakistan namely “Kharif” and “Rabi. Kharif
sowing period start in April and harvest in October and December. Rabi season begin in
October-December and ending in April-May. Cotton, sugar cane, rice, maize and millet are
Kharif crops while wheat, gram, tobacco, mustard and rapeseed are Rabi crops. The major
crops as wheat, cotton, rice, sugar cane and maize account for 41% in value added and minor
crops 10% in overall agriculture. A emerging sub sector of agriculture is Livestock. It
contributes 37.4% in agriculture value added and 9.7% in GDP. Similarly fisheries is also
playing significant role in national income through exports earning.
Overview of Agriculture Sector:
I- Development in Agriculture
Agriculture is a significant sector of Pakistan economy. The growth in national economy and
agriculture sector go hand in hand. In past fluctuations in agricultural growth significantly
affected the national economy. The share of agriculture sector to the GDP has nosedived
gradually since the time of independence of Pakistan. Agriculture sector share to GDP was
51% in 1949-50 and 21% in 2008. In the GDP composition agriculture sector is still a pivotal
figure.
Agriculture sector of Pakistan has made terrific progress since the time of came into
existence in 1947. There haven been some years of cruising growth and some years of
dismal growth In sixties the production of wheat and rice increased due to green revolution.
During the decade an average growth rate was 5.1%. The growth rate declined to 2.4% in
seventies due to massive nationalization policy. However the seventies was a era of high
public sector investment in agriculture sector. During this period many important institutions
were commissioned which are Tarbela Dam, Paksiatn Agriculture Research Council,
Training and Visit Programme of Agriculture Extension, Seed Certification and Registration
Department, Seed Corporation, On Farm Water Management and Barani Area Development
Programme. During the same period Cotton Export Corporation and Rice Export Corporation
were established to provide the international market to these major indigenous productions.
The result of high public sector appeared in eighties. During the decade the growth rate was
5.4%. In eighties Government established Agriculture Prices Commission to set the official
support price for major crops. After lost the heavy public treasure in the form of public
investment in agriculture Government started closing down public sector institutions in
nineties. These institutions played a vital role in the development of agriculture. Some
institutions were confined by the Government. After shout down of some institutions and
confined role of some institutions the farm economy started dwindling. During middle of
nineties period the production of cotton slumped due to virus attacked on this crop and the
economy inflicted heavy losses. In late nineties years the productions of crops and livestock
effected by the drought. Despite these difficulties Pakistan transformed from wheat importing
country to wheat exporting country. The average growth rate during the nineties was 4.4%.
The basic philosophy has been to maintain a growth rate in agriculture sector higher than
population growth rate. The average growth rate of the agriculture sector over the last sixteen
years was 4.3%. The supply of land is limited and due to increase in population the demand
of land for living is increasing. So in this way the area under crops is limited. The Ministry of
Food, Agriculture and Livestock is emphasizing on increasing productivity. Livestock has
emerged as an important subsector. Its share to agriculture GDP is more than one third which
was 28% twenty years ago. The Ministry of Food, Agriculture and Livestock also focus on
increase the efficiency and productivity of livestock.
II- Role of Agriculture Sector towards Food Security
“Food security exist when all people at all times have physical and economic access to
sufficient, safe and nutritious food to meet their dietary needs and food preference for an
active and healthy lifestyle” ( World Summit 1996). Agriculture sector is an important sector
to provide food to the fast growing population of the country. The commodities that make an
integral component of food security are food grains, edible oil and sugar. Although Pakistan
has made significant progress in food production over the last sixty years but most of
population have had to face uncertainty in food security and it has been remained food deficit
country. The production of wheat increased from 3.3 million tones in 1950-51 to 23 million
tones in 2006-07. During the same period the production of rice soared from 0.8 million to
5563 (000) tones. Pakistan is self-sufficient in rice production as well as surplus in rice and
export the rice specially Basmati and earn foreign exchange. For oil seeds, the country turned
from self-sufficiency into a major importer of edible oils. But on the other side during 1970-
71 the amount of wheat imported was 0.3 million tones, it increased to 4.1 million tones in
1997. The significance of agriculture sector towards food security in term of availability
shadow due to increase in population. In 1947 the population of Pakistan was 32.5 million
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and now in 2008 census it is 160 million. According to United Nations Statement on Food
Security in Pakistan 2000, in more than 50 years (1948-2000) the population has increased
four folds but in the same period the production of wheat and other major food crops has
increased only 2.9 percent. However Pakistan Agriculture Research Council claims that the
production of wheat in the country has increased by more than 6.5 fold. The joint Secretary at
Ministry of Food and Agriculture of Pakistan Mr.Amjad Nazir told that �� There will be no
need for us to import wheat this year because the ministry has raised the minimum price of
wheat for farmers which encouraged them to allocate more land to grow wheat” (Dubai
News Channel May 18 2009).There was ban on the exports of wheat in 2007 due to shortage
and higher prices of wheat at home. Now it is likely that Pakistan will exports wheat this year
said the Qadir Bukhsh Baluch who is the wheat Commissioner at the Ministry of Food and
Agriculture of Pakistan. Food insecurity in Pakistan is not only due to underproduction.
There are many other reasons like increased use of farming in biofuels, world oil prices
which is going down due to financial crisis, low purchasing power, population growth and
loss of agriculture land for residential and industrial development. Although the per capita
income of the country has increased steadily over the years but it does not mean that the all
the population of the country is food secure.
III- Role of Agriculture Sector towards Poverty Alleviation.
Poverty is an international phenomenon. According to the FAO 2005, 1.2 billion people of
the world live below the poverty line and more than 850 million does not have enough access
to sufficient food for an active and healthy life. The world total population who live below
the poverty line, 1.089 billion live in developing countries and 0.431 billion live in South
Asia. As far as the Pakistan is concerned it ranked 136 based on HDI out of a total 177
countries. Pakistan is better off as compared to its neighbour countries like India, Sri Lanka,
Bhutan which ranked 128, 99,133 respectively.
In Pakistan two-third of the total population live in villages and more than two-third of
the population are poor (World Bank 2002). Majority of the rural population earn their
livelihood directly and indirectly form the agriculture sector. The agriculture sector absorbed
42% of the manpower of Pakistan. Only half of the rural population are farmers and other
half are non-farm. The rural non-farm population, who are poor, produces non tradable goods
and services and the market of these goods and services is local. Farmers spend half of their
incremental income on the non-farm goods and services. So the increase in farmer’s income
drives demand of the non-farm sector. There is close relationship between agriculture growth
and poverty reduction.
In the 1960s, agriculture in Pakistan grew rapidly and poverty nosedived rapidly. In the
1970s, the growth in agriculture was slow and the poverty reduction was also slow. In the
1980s, agriculture growth soared once again and the poverty declined from 49% to 36% of
the population. The reason of the growth was green revolution. Due to slow growth in
agriculture between the period 1989-90 and 2004-05, there was no change in poverty
reduction (World Bank 2007).
Therefore if we want to reduce the poverty, we will have to increase the income and
outputs of agriculture sector. For this purpose we will have to remove all the obstacles in the
way of agriculture development. We will have to provide more credit, more fertilize, good
market for agricultural goods, better irrigation facilities and storage facilities etc.
Accordingly the government has started water projects worth Rs. 300 billion so that
the water facilities could be increased in the country. After the completion of the projects not
only 2.88 million acre additional land could be irrigated but 4.4 million feet additional water
could be reserved for irrigation purpose also. As a result of these agriculture, agriculture
production could be increased leading to increase more incomes and employment for the
rural and urban population.
Achievements in Agriculture Sector:
I-Production Increased Overtime:
Agriculture sector is not only provide food to fast growing population of the country, it also
provide raw matter to the industry sector. Even there have been fluctuation in the production
of agriculture due to pest attacks on crops, climate reasons but on the other hand the
production increased overtime due to agronomic,better irrigation and extensive policies of
governments. In 1960-61 the food grain production was 5,925 billion tones but it increased to
30,689 billion tones in 2007-08.Livestock contribute 38.7% to agriculture value added and
9.3% to national GDP. In livestock sector the production of milk,meat and fishers also
increased. The production of milk,meat and fishers in 1989-90 were 14723, 1507, 446.2 (000
tones) respectively . In 2007-08 it increased to 35160, 2515, 490.0 (000 tones) (Economy
Survey of Pakistan 2009).
Wheat which is the main staple food for the country’s population because it is main
source of getting calories for the majority of the population. In 2007-08 there were shortage
of wheat due to wrong policy of the government but now in 2008-09 the provisionally
estimated of wheat production is 23.4 million tones which is 11.7 percent more as compared
to last year. The reasons of high productions are government support price of Rs. 940 per 40
KG, subsidy on fertilizer of Rs.32 billion as well as timely rain.
II-Biotechnology
the phase of practical application on a large scale. In agriculture,
biotechnology has been applied in different fields, including the production of genetically
modified (GM) crops. Biotechnology has considerable potential for promoting the efficiency
of crop improvement, food production, and poverty reduction, especially in developing
countries like Pakistan.
In Pakistan the use of modern biotechnology has started from 1985. There are hundreds
of scientists working at more than 29 centres conducting biotech research in different areas.
Most of the activities have been on rice and cotton, which are among the top 5 crops of
Pakistan. There are about 6,000 plant species in Pakistan; out of these only 1,010 species are
identified as having medicinal value. Pakistan Agriculture Research Council (PARC)
established a “gene bank” at the Institute of Agricultural Biotechnology and Genetic
Resources (IABGR) and the National Agricultural Research Center (NARC), which contains
more than 30,000 genes and DNA of different plant species. The germ plasm of major
cereals, minor cereals, food legumes, oilseeds, vegetables, fruits, fiber crops, fodder and
forages and medicinal plants are available from this ‘gene bank” for scientists and researcher
for the development of new varieties. More recently PARC has established with NARC a
new institute the National Institute for Genomics and Advance Biotechnology (NIGAB);
which will conduct research on structural and functional genomic of both plants and animals.
Pakistan has made considerable progress in the research and development sector of
agriculture biotechnology and has developed several GM crops. However, commercial
release is hampered due to delays and weak capacity of regulatory bodies related to biosafety
and IPR (Plant Breeders Rights).There is an illegal spread of biotech (Bt) cotton on a large
area due to strong demand of farmer community. So far, development of GM crops has
remained exclusively in the public sector, but lately multinational companies (MNCs) have
made the initiative to enter into the market under new conducive regulatory regimes that need
to be further strengthened. Capacity building in regulating authorities aided by strict legal
control is a prerequisite for safe and sustainable use of agricultural biotechnology. It is
expected that the farmers of Pakistan will reap the benefits of legally released and
indigenously developed biotech crops in the next 1-2 years.
III-Irrigation Facilities:
Water is unique natural resources. The irrigation system of Pakistan is recognized as the
largest integrated irrigation network in the world, covering more than 16 million hectares and
crossing nine agro-climatic zones. This irrigation network comprises three major storage
reservoirs, 19 barrages, 12 inter-river link canals, 43 independent canal commands equivalent
to 61,000 kilometers and over 107,000 watercourses of about two million kilometers,
including field channels. This huge system of irrigation in the country mostly irrigates the
lands of two provinces named Sindh and Punjab, by irrigating relatively small areas of
NWFP and Balochistan provinces.
The cultivated area of Pakistan is 22.27 million hectares which was 14.19 million
hectares. Out of the total cultivated 15.67 million hectares is irrigated and remaining depend
on rain. The availability of water increased by 122.15 million acre feet in 1997-98 to 137.80
million hectares in 2006-07. The increased in irrigated area was most significant before 1980,
when the irrigation system was being expanded through High Efficient Irrigation System
Since the 1980, increase in irrigated area have come form groundwater resources. But the
area irrigated by canal has unchanged because the water resources are approaching its limits;
there is little potential for further increase in irrigated areas. The Governments has recently
launched its largest project through Ministry of Food, Agriculture and Livestock which aim
at bring more than 275,00 acre under micro irrigation in a period of five years. In addition, in
2007-08 non government funding primarily from Pakistan Poverty Alleviation Fund (PPAF)
has been providing funds for the installation of HEIS system through the country through
their partner originatsion. It aim at to improve the productivity of agriculture sector so that
poverty can be removed.
Weakness of the Agriculture sector;
I-Small holding of Land:
In Pakistan the farm size is decreasing due to law of inheritance over the time. The average
farm reduced from 5.28 hectares in 1972 to 3.1 hectares in 2000. According to Agriculture
Census 2000, farms size which are 2 hectares or less constitute about 58% of the total farms
and operate only 16 % of the total farm whereas 5 % of farms operated 37% of the total
areas. So due to small size of farm we can,t apply modern technology for getting the
optimum level of production. In most of Pakistani villages farmers are doing subsistence
farming due to small size of farm. Increased numbers of farm are being operated as
uneconomic holdings, which can,t provide acceptable level of living to large chunk of
farming community. The farms of very size may also be inefficient. Although land reforms
have been done but it proved useless due to political landlord who have influence on policy
making. There is again an need to determine optimal farm size and optimal cropping
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intensity in various agro-ecological regions of the country and to provide required incentives
so that majority of farm move towards the optimal size.
II-Shortage of Fertilizers:
Fertilizers and highly yielding varieties are important agricultural inputs. The success story in
proliferation of crops production since mid 1960s can be attributed at fertilizers consumption.
So demand of fertilizers is higher than supply in Pakistan. The domestic production of
fertilizer is 5.8 million tones per annum but the demand is 6.8 million tones per annum
Although Government provide subsidy on fertilizers but it become useless when the farmers
get the fertilizers through back window due to poor market and poor distribution. In 2008
farmers in Pakistan badly suffered in getting the fertilizers. Those who have political relation
got the fertilizers because there was government control on the supply of fertilizers. So it is
need to deregulate the process of distribution of fertilizers so that farmers can get fertilizers
on time, in the right quantity and at right price.
III-Poor Marketing of Agriculture Production:
Marketing is one of the major problems of agriculture sector of Pakistan. Farmers in Pakistan
don’t get the right price of their production because of the poor functioning of market. There
are two kinds of markets in Pakistan green and grain markets. Green market is for vegetables,
fruits and grain market is for wheat, rice etc. Due to long chain of market most of our
agriculture produce pass through a number of players. Among these wholesalers and
commission agents who exploit the farmers are most important. Vegetables such as onion,
potatoes which are perishable commodities are sold to local areas. These are taken to whole
sale market and are sold to whole sellers or commission agents. The wholesalers buy through
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open auction and sell to sub-wholesalers in small form. These sub wholesalers sell these
commodities to the retailer after grading. From the retailer consumer get these things at high
prices due to excessive rates of various intermediary services on the base of such structure of
market, monopoly of cartels exist in the market in the form of commission agents and whole
sellers who deprive and exploit the farmers. Most of our food grain sold to shop keepers at
village level due to inadequate information at local level. Such sale of food grain is
disadvantage of the small farmers. It has been observed by some survey and marketing
studies that when the supply of fruits and vegetables reach at peak , some times farmers even
don’t get the cost of transport to bring their to the market. About 30% to 35 % agricultural
production waste due to post harvest in Pakistan due to limited market at local level.
In live stock sector Pakistan is 5th largest country in the world in the production of milk but
unfortunately our people specially in urban areas don’t get the better quality milk due to
market structure. Milkmen get milk from the rural areas and adulterate water in order to
make more maximize their profit. There is no quality control in the market and adulteration is
the name of the game in the market. This situation leads to vicious circle of malnutrition;
(malnutrition-disease-low performance-low productivity-low income-malnutrition).
Recommendation:
Poor Marketing:
I- The structure of market chain should be reset by removing the middlemen who exploit
the
farmers. Both markets green and grain should be strictly regulated by government.
II- Storage facilities should be provided so that farmers can storage their
production in the time of peak harvest to control the supply and demand fluctuations.
III- A marketing cooperative should be established which could accumulate the marketable
surplus of farmers and send it to big markets for exports.
IV- After sorting out agriculture goods inferior and superior the packing of these
commodities should be international standard both.
V- In order to provide good quality mike through out the country, a cell should be establish
which accumulate milk from the dairies and after processing it will provide to the
people of the country.
VI- There is need to resetting tarrifs, taxes and subsidies to accelerate export.
VII- Seeking comparative advantage and making foreign exchange
In spite of big production, benefits are not gained due to poor marketing. Little fine tune
can bring fruits of all efforts.
References
Dr. Muhammad Hanif, Dr. Shakeel Ahmed, Fayyaz Ahmed Nauman, (2004) Agricultural
Perspective and Policy, Ministry of Food Agricultural and Livestock Islamabad Pakistan
Economy Survey of Pakistan (2008-09) Government of Pakistan
Muhammad Iqbal Munir Ahmad, Science & Technology Based Agriculture Vision of
Pakistan and Prospects of Growth
Federal Bureau of Statistics, Government of Pakistan
Shafqat Munir Budget (2006-07) Compromising Food Security and Agriculture
Weidemann Associates, Pakistan Food and Agriculture Project Report to USAID/Pakistan
(2009)
Water Resources Section, Planning and Development Division Government of Pakistan
Food Agriculture Origination Report (2005) Rome
Yusuf Zafar Journal of AOAC International (September- October 2007) Daily Times
Ijaz Ahmad Rao “Genomics to Improve Farming” The Dawn Newspaper
Sarah Aziz Boosting Water Productivity in Agriculture Sector