Agriculture sector achieves growth target

Performance remained encouraging in 2020-21 as sector grew by 2.77%

KARACHI:

The agriculture sector – the backbone of national economy and a major source of employment – recorded a significant growth of 2.77% during the outgoing fiscal year, which was in line with the target of 2.8% set by the government during the pandemic.

At the announcement of Economic Survey 2020-21, Finance Minister Shaukat Tarin revealed plans to empower small farmers by taking relevant measures.

The agriculture sector’s performance during 2020-21 remained encouraging as it grew by 2.77% against the target of 2.8%. Growth of important crops – wheat, rice, sugarcane, maize and cotton – during the year came in at 4.65%, according to the survey report.

Tarin highlighted that all major crops grew except for cotton.

Production of major Kharif crops, such as sugarcane, maize and rice showed a significant improvement compared to last year and hence surpassed the production targets.

Production of sugarcane increased by 22% to 81.009 million tons from 66.380 million tons last year, rice production grew by 13.6% to 8.419 million tons compared to 7.414 million tons and maize by 7.4% to 8.465 million tons from 7.883 million tons.

However, cotton crop suffered due to a decline in the area sown, heavy monsoon rains and pest attacks. Total cotton production was estimated at 7.064 million bales, down 22.8% compared to output of 9.148 million bales last year.

Wheat, the most important crop of the Rabi season, posted a growth of 8.1% and reached a record high production of 27.293 million tons compared to 25.248 million tons recorded last year.

Read: Enabling policies for developing Pakistan’s agriculture

Wheat cultivation area increased to 9.178 million hectares, prompted by record domestic prices and official programmes introduced to promote production of the staple crop.

“Agriculture is the backbone of the economy, which is undoubtedly the main source of raw material, however, the major concern is high rate of food inflation despite bumper crops,” said Union of Small and Medium Enterprises (Unisame) President Zulfikar Thaver while talking to The Express Tribune.

“This is due to profiteering, speculation, hoarding, smuggling and black marketing, which is giving rise to inflation and resulting in imports,” he elaborated.

Cotton

The crop contributes around 0.6% to the gross domestic product (GDP). It faces multiple challenges and competes with other crops, especially sugarcane.

Being an export-oriented raw material for textile industries, maintaining prices at levels competitive with the international market while ensuring due profitability for growers has been a great challenge for policymakers.

During 2020-21, the crop was cultivated over 2,079 thousand hectares, reflecting a contraction of 17.4% as compared to last year’s sown area of 2,517 thousand hectares.

Production declined by 22.8% to 7.064 million bales against the output of 9.148 million bales last year. The declining cultivated area has pushed down production as the crop lost its competitiveness relative to other major crops, in particular sugarcane.

Sugarcane

During 2020-21, the crop was cultivated over 1,165 thousand hectares, an increase of 12% compared to last year’s sown area of 1,040 thousand hectares.

Production increased by 22% to 81.009 million tons against 66.38 million tons recorded last year. The crop experienced a significant increase in the area under cultivation and yield.

It was mainly due to favourable weather conditions, better management, timely availability of quality inputs and higher economic returns.

Rice

During 2020-21, the second main staple food crop was cultivated over 3,335 thousand hectares, reflecting an increase of 9.9% as compared to last year’s sown area of 3,034 thousand hectares.

The current year witnessed a record production growth of 13.6% to 8.419 million tons against 7.414 million tons recorded last year. This was primarily due to rising unit prices and higher demand for Pakistani rice in export markets.

Wheat

In the outgoing fiscal year, the area under cultivation increased by 4.2% to 9,178 thousand hectares over last year’s sown area of 8,805 thousand hectares for the main staple crop of Pakistan, wheat.

Wheat crop production touched the historic high of 27.293 million tons, showing an increase of 8.1% compared to production of 25.248 million tons last year.

This was primarily due to an increase in the cultivated area, along with a shift of policies to support the wheat crop through an increase in the minimum support price (MSP). MSP in 2020-21 was increased from Rs1,400 to Rs1,800 per 40 kg, a 29% hike.

Read more: Agriculture sector: challenges and way forward

Maize

During 2020-21, the third important cereal crop of Pakistan was cultivated over an area of 1,418 thousand hectares, reflecting an increase of 1% compared to last year’s 1,404 thousand hectares.

Its production increased by 7.4% to 8.465 million tons compared to last year’s production of 7.883 million tons. The production increase was largely due to an increase in the cultivated area, availability of improved variety of seed and better economic returns.

Speaking on the occasion, Federal Minister for Industries and Production Khusro Bakhtiar said the Ministry of National Food Security and Research had presented an action plan to the prime minister for the transformation of agriculture sector.

Under this plan, provinces will work on re-tweaking the machinery given under the National Agriculture Emergency Projects (NAEP) for wheat, rice, sugarcane and oilseeds for maximum distribution of implements among the farming community.

Talking to The Express Tribune, Sindh Abadgar Board Vice President Mehmood Nawaz Shah criticised the Economic Survey, saying it projected more about the future instead of giving the masses an account of outgoing years.

“The survey did not highlight the potential growth the sector could not achieve due to hurdles such as Covid-19 and massive rainfall in seven districts of Sindh,” he highlighted.

Endorsing his views, Agriculture Republic Co-founder Aamir Hayat Bhandara said, “In the survey, the government did not mention the post-harvest loss, which is estimated at $1 billion due to absence of storage facilities, cold storages, efficient supply chain, etc.”

Published in The Express Tribune, June 11^h, 2021.

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