FeaturedNationalVOLUME 19 ISSUE # 9

Major challenges hindering growth of agriculture

That agriculture is the backbone of Pakistan’s economy is not just a cliché but a hard reality. It is a major employment provider, supplier of basic raw materials for exports, and accounts for more than 20 percent of GDP. Yet, over the years agriculture has never received the attention it deserves.

Various surveys have found that during 2023, the sector showed some improvement but continued to face major challenges hindering its growth. This was despite some supportive measures and relief packages announced by the government. Burdened with the aftereffects of massive flooding in the monsoon of 2022, the agriculture sector managed to show better performance in the production of some crops. For instance, corn output went up to 10.8 million tons, cotton harvested 8 million bales and wheat crop 27.634 million tons.

According to many experts, despite some setbacks, the year 2023 was better than the previous one, marking higher growth which will be more prominent by the end of the current fiscal year in June 2024. It may be added here that in 2022-23, the agriculture sector grew only 1.55% as compared to 4.40% in FY22. The achievement was all the more creditable in view of a difficult global environment. Internally, there were also some negative factors at work like political uncertainty and a ban on imports. Yet in many areas higher crop output  was recorded.

However, in the view of the Kissan Board the overall situation in the agriculture sector is not satisfactory and immediate relief measures are needed to help the farming community. It is said that despite improvement in the production  of key crops, the threat of food security still looms large. Pakistan’s food inflation rate has remained in double digits, sometimes at all-time high, throughout the year, reflecting a failure to manage food production and distribution efficiently.

Various reports show that high costs of inputs, exorbitant energy tariffs and unavailability of fertilisers pushed the farmers in amore vulnerable position. No doubt, they got good returns on their produce in the shape of support prices, but this gain was offset by the ever rising inflationary pressures. According to the Secretary of Kissan Board,“It (2023) was probably the worst year for the agriculture sector with no checks and balances from the administration to control prices and tackle hoarders. Fertiliser price has skyrocketed to Rs6,000 per bag from the actual rate of Rs3,600. Similarly, di-ammonium phosphate (DAP) price stands at a significantly high level at Rs14,000.”

He also regretted the fact that in view of the chronic shortages of farm inputs, during 2023, farmers held a series of demonstrations, demanding a solution to their problems, but to no avail. He said that things are taking a turn for the worse, and if remedial measures are not taken immediately, the role of the agriculture sector will further diminish which will have a damaging effect on the national economy.

The challenges in the agriculture sector are compounded by the fact that the authorities concerned have failed to achieve the Sustainable Development Goal of reducing hunger by 50% this year. On the other hand, the population is growing at an alarming pace of 2.2% per annum. To feed this growing population and ensure food security for all, we need at least 5-6% rate of growth annually.

A major problem of the sector is corruption and bad governance at all levels. Sometime back, the government announced a Rs1,800 billion package to help farmers through different means, including provision of subsidised fertiliser, seeds and quality pesticides. The Kissan Package was also aimed at facilitating access to credit and soft loans to enable farmers to invest in efficient farming practices and modern machinery. But this welcome package failed to make any impact on the rural economy.

Agrarian experts agree that in the given circumstances the government should come out with another relief package for small and medium farmers. Lately a commendable effort has been made to switch agricultural tube wells to solar power which has proved helpful in saving energy costs. It is reported that the government has allocated an amount of Rs30 billion in the current fiscal year to convert more than 50,000 tube wells to solar energy. If the plan is executed as conceived, there will be a considerable increase in crop production all across Punjab.

To put the sector on a sustainable growth path, it is important to tackle long standing issues such as lack of access to modern technology in remote areas, water scarcity and frequent shortages of essential inputs and their rising prices. It is also time strong administrative steps were taken to curb the role of the middlemen who create artificial shortages to jack up prices. Most important of all is continued government commitment to innovation, sustainable practices and comprehensive support for the farming community.

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