NationalVOLUME 19 ISSUE # 29

Neglect of agriculture: The Achilles’ heel of Pakistan’s economic performance

Over the last four decades, Pakistan’s economic performance has been lackluster, primarily because successive governments have overlooked the agricultural sector in favor of what can be termed as questionable industrialization efforts. These initiatives not only failed to shift the economy towards an industrial base but also caused significant harm to the agricultural sector.

The political leadership neglected the crucial fact that approximately 64 percent of Pakistan’s population resides in rural areas. In 2018, the country ranked 23rd globally in terms of nominal Gross Domestic Product (GDP), measured by purchasing power parity (PPP).

According to the Labor Force Survey by the Pakistan Bureau of Statistics, 39 percent of the country’s labor force is engaged in agriculture, with 30.2 percent being males and 67.2 percent females. The agriculture sector contributes 22 percent to Pakistan’s GDP.

Out of a total land area of 79.6 million hectares, 22.1 million hectares are under cultivation, while the rest consists of culturable waste, densely populated forests, and rangelands. The cultivated area encompasses 23.3 million hectares, and forests cover 4.6 million hectares of the country’s total land. Pakistan boasts the world’s largest contiguous irrigation system, with nearly 80 percent of the cultivated land being irrigated.

Pakistan is among the top ten global producers of wheat, cotton, sugarcane, mangoes, dates, oranges, and ranks 10th in rice production. Major crops, including wheat, rice, cotton, and sugarcane, contribute approximately 4.9 percent to the country’s total GDP, while minor crops contribute 2.1 percent.

The livestock sector accounts for 11 percent of Pakistan’s GDP, with a substantial 60.5 percent contribution to the agriculture sector, providing employment to around 35 million people. Fisheries and forestry sectors each contribute an estimated 0.4 percent to the GDP, with a 2.1 percent contribution to the agriculture sector.

Despite notable growth in agricultural production in the past, Pakistan currently faces significant food insecurity issues, largely attributed to the policies of successive governments. According to a joint report published by FAO, WFP, UNICEF, WHO, and IFAD in 2019, 20.3 percent of Pakistan’s population, equivalent to 40 million people, suffer from undernourishment and food insecurity.

Malnutrition rates among children aged 6-59 months are alarmingly high, with approximately 40 percent stunted, 28 percent underweight, 18 percent wasted, and 10 percent overweight. Additionally, about one-fourth (24 percent) of the country’s population lives below the national poverty line, and 39 percent are considered poor based on the multidimensional poverty index (MPI).

In recent decades, the agricultural sector has faced stagnation, largely due to government policies prioritizing industrialization. From 2008 to 2018, federal governments shifted their focus away from agriculture toward industry, diverting essential financial resources and attention required for the sector’s development. Natural disasters such as floods and droughts exacerbated these challenges.

The 2022 floods submerged one third of the country, affecting 33 million people, half of whom were children. The floods damaged most of the water systems in affected areas, forcing more than 5.4 million people to rely solely on contaminated water from ponds and wells. Severe flooding in September 2014 destroyed approximately one million acres of standing crops, along with irrigation canals and land erosion. In August 2010, heavy monsoon rains triggered floods that ravaged about one million hectares of crops in Punjab. These calamities significantly impacted vital food crops like wheat, sugarcane, and rice, leading to a substantial drop in rice and wheat exports.

Pakistan had to resort to importing cotton from neighboring countries to sustain its textile sector. Despite numerous opportunities, Pakistan’s leaders consistently failed to address the genuine issues plaguing its economy. Instead of nurturing its agriculture-based foundation and implementing sincere policy measures to promote this vital sector, successive governments leaned heavily on imports.

Throughout the five-year tenure of the Pakistan Muslim League-Nawaz (PML-N) government from 2013 to 2018, the country fell short of achieving its targeted growth rate of 5.7 percent, mainly due to a decline in the agriculture sector. The Social Policy and Development Centre (SPDC), a Pakistani think tank, even contested the government’s claim of a 4.7 percent GDP growth rate, asserting that it was only 3.1 percent in the fiscal year 2015-16.

The government’s approach to the agriculture sector was characterized by excessive and often interventionist policies, which included neglecting the needs of small-scale farmers and imposing additional taxes through increased power tariffs and fertilizer prices. Despite changes in government and even military coups, the PML-N’s provincial government in Punjab, a critical agricultural region, held power for nearly two decades. However, the agriculture sector consistently lagged behind other sectors in terms of growth.

The heavy-handed tactics employed by the government to suppress farmer demands raised concerns among those associated with the agriculture sector. The Pakistan Farmer Association organized protest demonstrations outside the Punjab Assembly, calling for an end to extra taxes on fertilizers and electricity. These protests were met with a government response that involved deploying the police.

The neglect of the agriculture sector and the use of force against farmers advocating for their rights stemmed from the PML-N leadership’s fixation on the industrial sector and an unbalanced economic approach that viewed agriculture as an “obsolete” domain not worthy of significant government-driven growth interventions. This problem was compounded by the lack of research support to enhance crop productivity, outdated agricultural practices, and the deterioration of the irrigation system, all of which resulted in reduced international competitiveness.

Although the Pakistan Tehreek-e-Insaf (PTI) government made some efforts to rejuvenate the agriculture sector, various policy challenges hindered progress. Agriculturists faced shortages of fertilizers and certified crop seeds, and the country grappled with severe shortages of wheat, sugar, and pulses. Those closely involved with the sector fear that these crises will multiply in the years ahead unless the national economy is firmly grounded in a genuine and robust agricultural foundation.