Pakistan’s reliance on imported edible oil has become a significant economic challenge, with the sector consuming billions of dollars annually. Despite being an agrarian country, Pakistan’s domestic production of oilseeds remains insufficient to meet growing demand. The government’s efforts, such as the Punjab Oilseed Promotion Initiative and the National Oilseed Enhancement Programme, show promise, but broader implementation across all provinces and a more comprehensive policy framework are essential to address this critical issue.

The Ministry of Commerce’s initiative to draft a comprehensive edible oil policy presents a crucial opportunity for Pakistan to address its growing reliance on imports, which is particularly problematic for a nation often referred to as agrarian. Edible oil accounts for the largest portion of Pakistan’s food import bill, amounting to a staggering $3 billion annually. This is driven by a demand that has more than doubled in the last two decades. However, domestic production remains minimal, highlighting systemic policy failures. The country’s dependence on imported edible oil, especially palm oil, reveals a troubling disregard for local oilseed production.

The State Bank of Pakistan’s 2021 report on oilseeds identified the absence of a consistently implemented oilseed policy as the primary issue. This policy gap has led to numerous challenges, including limited research, insufficient agricultural extension services, ineffective marketing and procurement systems, and a fragmented value chain. Additionally, the lack of support prices for oilseeds discourages farmers, while inefficient oil extraction methods worsen the situation.

The competing demands for arable land, along with the dominance of staple crops, leave little space for oilseed cultivation. Even when oilseeds are grown, yields fall well below potential due to outdated farming practices and limited access to specialized equipment. The problem is further aggravated by the scarcity of high-quality seeds suited to local conditions. These underlying issues, stemming from policy neglect, need to be addressed to reverse the current trend.

Pakistan has faced challenges in establishing strong institutional support for oilseed development. The dissolution of the Pakistan Edible Oil Corporation in 1979 and the inconsistent operation of the Pakistan Oilseed Development Board reflect an erratic approach to this vital sector. Although the board was revived in 2021, its impact has been minimal, particularly after the 18th Amendment, which left provinces without oilseed-specific institutions or federal guidance.

A comprehensive edible oil policy must focus on boosting domestic production of oilseeds such as sunflower, canola, and soybean. Unlike palm oil, which takes 10 to 15 years to produce significant yields, these crops offer more immediate solutions. Punjab’s Oilseed Promotion Initiative and the federal government’s National Oilseed Enhancement Programme are promising steps, but they need to be expanded nationwide, with a focus on building farmers’ capacity. Immediate incentives could include subsidized seeds, support prices, and tax exemptions on oilseed processing.

In addition, targeted investments in research and development should focus on improving soil compatibility, seed quality, and climate resilience. Measures to manage imports and demand can complement production incentives. For instance, modest customs duties on imported edible oil and ghee could encourage local cultivation of sunflower and rapeseed.

However, these measures must be carefully balanced to avoid causing price shocks, especially for low-income households. Public awareness campaigns on reducing edible oil consumption and promoting healthier alternatives should also be part of the policy framework.

In the long run, Pakistan cannot overlook the potential of oil palm and soybean cultivation. Although the current outlook for domestic palm oil production is challenging, new technical surveys and pilot projects could lay the foundation for future expansion. Collaborating with international experts and establishing a robust institutional framework will be crucial to realizing this potential. Malaysia and Indonesia’s successful palm oil strategies provide valuable lessons for Pakistan, but the country must also consider its own unique agro-ecological conditions. Consistency and perseverance will be key to success.

The path to self-reliance in edible oil will require ongoing cooperation between federal and provincial governments, the private sector, and international partners. Short-term gains from sunflower and canola production must be paired with long-term planning for palm oil and soybean cultivation. Policymakers must avoid complacency once initial progress is made.

It is obvious that complete self-sufficiency in edible oil production may not be realistic, even a modest reduction in imports would significantly ease Pakistan’s economic burden. A well-implemented, forward-thinking edible oil policy could transform the agriculture sector, reduce the trade deficit, and restore some of the country’s agrarian pride. This is a challenge that policymakers can no longer afford to overlook.

While achieving complete self-sufficiency in edible oil production may be unrealistic in the short term, implementing a robust and forward-looking policy could significantly reduce Pakistan’s import bill. By focusing on domestic oilseed production, investing in research, and fostering collaboration between stakeholders, Pakistan can alleviate its economic burden, enhance its agricultural sector, and regain its status as a strong agrarian economy. This challenge must be addressed with urgency and vision for long-term sustainability.