Rice crop hit by tight water supply

Reuters June 21, 2010

KARACHI: Pakistan’s 2010-11 season rice crop is expected to drop by 14 per cent versus a year earlier as India limits water supplies to Pakistan, a board member on the Rice Exporters Association of Pakistan said.

Pakistan’s Indus river basin is supplied by melting snow and glaciers from the Himalayas. Both India and Pakistan make use of the Indus, with the river managed under a 1960 water treaty.

“We expect the drop because India is building dams and diverting water from the same river we share,” Sham Khan told Reuters on the sidelines of an industry conference in Dubai.

“This water issue is a serious problem and Pakistan is currently in talks with India to try to resolve this as agriculture represents around 23.3 per cent of our GDP (gross domestic product),” he said.

During the 2009-10 season, which started in August and ended in February, the country produced around 6.7 million tons of the water-intensive crop due to good weather conditions, Khan said.

Other factors, besides water supplies, have also impacted the rice crop, Khan said. Some farmers have switched to cash crops such as cotton and sugarcane due to the abundance of rice on global markets, he added. Global rice supplies this year are expected to grow by one per cent compared to 2009, he added.

“The excess supply will push prices down and farmers want to make the most profit out of their land. That’s why they are looking to grow other crops,” he said.

Despite the drop in output, exports were expected to remain buoyant as domestic demand was mainly for wheat and not rice, said Khan.

He declined to estimate the volume of exports for the 2010-11 crop. For the previous season, the country exported around three million tons of rice, he said. The vast majority of between 90 and 95 per cent of water is used for agriculture, while the average use in developing countries is between 70 and 75 per cent. The remaining trickle is used for drinking and sanitation for a population of 180 million.

Published in The Express Tribune, June 22nd, 2010.


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