Agriculture sector: challenges and way forward

Farmers cannot switch to new technologies as they require heavy investment

Muhammad Nadeem Sarwar March 29, 2021


Agriculture is one of the key sectors of Pakistan’s economy. It comprises crops, livestock, forestry and fishing with crops being the major component.

This sector not only produces 19.3% of total output of the country but also provides employment to around 38.7% of the population, higher than all other sectors. This sector supports other related industries such as textile, sugar, tractor manufacturing, fertiliser, etc through strong forward and backward linkages.

A high yield in the agriculture sector also fosters commerce and trade since most of the farmers fall in the low or lower middle-income group whose marginal propensity to consume is high. Therefore, the contribution of this sector goes beyond what is reflected by statistics. Unfortunately, the sector, like many others, is performing well below its potential. Among major crops, the production of cotton is declining continuously over the last few years.

Last year, Pakistan produced around 9.18 million bales of cotton whereas in 2014-15, its production was 13.96 million bales.

Last year, the output of wheat and sugarcane was also insufficient to meet the country’s needs. Owing to this, the government had to import both sugar and wheat, which placed an additional burden on the national exchequer.

If we look at productivity, Pakistan’s per acre yield of major crops is less than that of other countries in the region. Unfortunately, this gap is widening further. There is an urgent need to study the factors and put in all efforts to revive the sector.

There is a long list of problems that need to be addressed. However, this piece will cover only some of those and the rest will be discussed sometime later.

Research centres

First, there is a need to restructure the agricultural research institutes. In line with the best global practices, the pay and incentive structure must be revised and linked with the output on the ground.

If we link the research institutes with industries and develop a revenue-sharing mechanism, such that part of revenue from a newly developed or improved product goes to the institution and the researcher also gets a fixed percentage, then this will not only incentivise the development of quality seeds, better pesticides and good farm techniques, but will also help increase the budget of such institutes.

Departments of agriculture at provincial levels are not playing their role actively. In fact, their performance has deteriorated over time. In the past, the Punjab agriculture department used to lease small pieces of land in various villages to cultivate crops with the help of local farmers by applying new techniques and latest research.

Field officers and other staff of the department used to visit and examine the land with the farmers and briefed them about their experiences. Such arrangements acted as field schools for the farmers, who could learn and update their farming skills by listening to the experts and observing the outcome of newly applied techniques.

However, now for more than a decade, not such activity has been noted anywhere. Instead, the agriculture department arranges seminars in expensive hotels in cities, thus limiting the access of small farmers to such sessions.

Apart from that, these seminars are arranged with the support of pesticide, fertiliser or seed companies. This gives birth to serious conflict of interest and the recommendations given through such platforms are not trusted.

The absence of guidelines from independent sources has left farmers at the mercy of sales agents of the pesticide, fertiliser and seed firms. Students of economics know that firms aim to maximise profit by selling maximum quantity and at the highest possible price, but this leads to an increase in the cost of agriculture production.

Therefore, there is a need to think of the role of agriculture departments in the provinces.

Water scarcity

Water shortage is another issue that is affecting agricultural output. Pakistan has not built any major dam for decades, therefore, the scarcity of water is affecting every sector and its consequences can be more severe in future.

Experts call for adopting modern irrigation systems such as drip irrigation and sprinkle irrigation, as embraced by various countries. The government, with the help of global financial institutions, is working to facilitate the adoption of such technologies, but all suggestions and actions ignore the fact that in Pakistan a majority of the farmers hold small-sized farms (of less than 12.5 acres).

These farmers cannot afford to switch to these technologies as they require heavy investment, even after subsidies are provided. Unfortunately, these farmers also have limited access to financial support from banks for various reasons.

Therefore, there is a need to provide solutions that can remove the constraints. Unfortunately, not a single solution has been proposed by any publicly funded research institute or department.

Fortunately, Pedavar, an NGO led by a renowned agricultural expert and run by farmers themselves, has come up with a cheap solution. They favour the cultivation of crops on raised beds and keeping the beds covered with residual of the previous crop. This slows down the evaporation process and keeps the beds wet for a long period, thus the farmers do not need to water the fields for a longer period.

As per Pedavar, it not only results in 70% reduction in water consumption, but the residual also keeps the fertility of soil high, thus fertiliser is not needed, which further slashes the cost.

Food crops cultivated as per the proposed system can be sold as organic food in the global market. This way, exports and foreign exchange earnings can be multiplied.

Agriculture departments and research centres can test the system. If it works, then they must educate the farmers at grassroots level. Setting up field schools for the purpose, as Punjab did in the past, will accelerate its adoption.

It needs to be pointed out that most of the graduates in the field of agriculture end up joining the sales teams of pesticide, fertiliser and seed companies. This is apparently the field of marketing graduates and a graduate in agriculture should ideally take farming as the profession as the knowledge he/she has gained will be utilised better.

The government can introduce an incentive programme which encourages the agricultural graduates to join farming as the profession. Incentives can include leasing public land to the graduates at concessionary rates, priority access to loans, etc.

The writer is a PhD scholar in Economics at IBA Karachi



Published in The Express Tribune, March 29th, 2021.

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