Pakistan’s Agricultural Sector: Challenges and Response (Part 2)

Introduction

In our last post, we discussed the historical evolution of Pakistan’s Agriculture sector and made time series as well as cross-country comparisons to assess the performance of this vital sector since independence. In this post, we will carry out a SWOT Analysis of Pakistan’s agriculture sector before prescribing a plan of action for its improvement.

SWOT Analysis of Pakistan’s Agricultural Sector

SWOT Analysis will help us understand its weaknesses and strengths on the one hand and the threats and opportunities it faces on the other

Strengths of the Agricultural Sector of Pakistan

Pakistan’s agricultural sector can boast of the following strengths.

1. Economic Base of the Country: The preponderance of agriculture in the political economy of Pakistan is its biggest strength. With more than 22 million hectares of land under cultivation, which is 35% of the total area of Pakistan, agriculture is the base of the economic structure of the country, sufficient not only for achieving food self-sufficiency, it also for meeting the industrial and export needs of the country. Contributing one-fifth of Pakistan’s total GDP, 47% of the total labour force is attached to this agriculture sector
2. Accumulated Knowledge: Being the main income activity of the people of the area for more than 6 millennia of recorded history, agriculture is the occupation of choice of the inhabitants. They now have more than 60 years of accumulated knowledge of modern agricultural practices.
3. Largest Irrigation Network: Although misused through inappropriate irrigation practices, water availability for the agriculture sector is still reasonable thanks to one of the largest irrigation networks in the world. This availability can be further enhanced by improving irrigation structures, constructing small and medium dams and using water-saving technology and practices
4. Diverse Ecological Zones: Along with good water resources and a vast natural resource base, Pakistan has diverse ecological zones that help Pakistani farmers produce a large variety of crops in different seasons all over the country.
5. Productivity Gap: Given the existence of vast productivity gaps within the country between progressive farmers and subsistence ones, there is great scope for increasing the average productivity and overall agricultural production with better extension services and input availability. This scope becomes even greater when compared with global leaders

Weaknesses of the Agricultural Sector of Pakistan

Here are some of the weaknesses of the agricultural sector of Pakistan adversely affecting its growth:

1. Preponderance of Small Farms: The preponderance of small farmers with a low technological base is the biggest weakness of an agricultural country like Pakistan. Most of the farms are fairly small, around 80% of farms are below 20 hectares, out of which more than 50% are below the size of 5 hectares. It has resulted in weak factor productivity, with yields rising below their potential.
2. Input Availability: Less than satisfactory availability of agricultural inputs at affordable prices at the right time is one of the biggest issues facing agriculture in Pakistan. The small farm size, coupled with the stretched resources of the farming community, makes the use of good quality inputs and machinery out of reach for the farming community in general. This also limits the farmers’ ability to adopt new techniques and diversify into high-value crops, and social networks. He is therefore forced to continue with subsistence farming. Mismanagement and unfairness in the distribution of government facilities like loans and subsidies have resulted in income inequalities and lower productivity of small farmers. By using political influence, only a few farmers get these facilities
3. Poor Rural Infrastructure: The condition of rural infrastructure is pathetic, increasing the cost of doing business. Post-harvest losses, inadequate supply chain Infrastructure, and inefficient and inadequate marketing add to these costs. Poor quality of life in the rural areas due to inadequate facilities like hospitals, standard schools, markets, and post offices, forces the educated children of the farmers to leave for the cities, creating a leadership void in the agriculture sector of Pakistan.
4. Looming Water Shortage: Water crises due to deteriorating irrigation networks, unsustainable irrigation techniques by farmers and an overall shortage of water coupled with the looming threat of climate change
5. R&D/Extension Services: Ineffective Education, R&D and Extension linkages have led to low progress in technological penetration and adoption of modern agricultural techniques, resulting in inappropriate use of natural resources
6. Underdeveloped Rural Non-farm Sector: The rural Non-farm sector, which is an essential component of the political economy of rural areas, performs below potential due to a lack of access to credit and other facilities.

Opportunities for the Agricultural Sector of Pakistan

Pakistan’s agricultural sector can tap the following opportunities.

1. Global Interest in Food: After the 2007–2008 oil and finance crises, which led to food shortages in many countries, there is now a worldwide interest in food security. While food-deficit countries are interested in importing food grains, some MNCs are ready to invest in the food and agriculture sectors to meet the rising demand for food.
2. Increasing Population: The burgeoning world population, expected to reach 9 billion in 2040, is creating the need for more food. It has created great opportunities for those countries with vast agricultural resources to produce food to meet the global demand for food.
3. Growing Prosperity: Growing prosperity will result not only in greater consumption of food but also changes in food habits: more meat means more food grains to feed the animals
4. Technological Improvements: Technological improvements in agricultural machinery and scientific breakthroughs in disease-resistant, high-yielding food crops are creating immense scope to increase the production of agricultural products through higher productivity. Farmers are also willing to adopt any new technology.
5. New Techniques: New techniques of cultivation and input use efficiency, particularly in water use, can bring about a revolution in agriculture. By introducing drip irrigation, 50 to 60% of water wastage can be controlled and water deficiency faced by farmers will also be overcome
6. Information Technology: Rapid advances in information technology and its greater penetration in rural areas make it possible to provide extension services to a vast number of farmers at their doorsteps. It is now easy and cost-effective to create awareness and motivate farmers to adopt new techniques and technologies.

Threats to the Agricultural Sector of Pakistan

Pakistan’s agricultural sector is facing the following threats:

1. Depleting Soil Fertility: Soil fertility is rapidly depleting due to the inappropriate use of chemical fertilizers and the inefficient use of canal water, which has increased the salt level of the canal-irrigated lands. Overpumping of groundwater through tube wells has depleted the fresh water and, in some areas, they are pumping out brackish water. Add the looming threat of climate change, and we have a perfect recipe for disaster.
2. Reduction in Arable Land: Thanks to rapid population growth, economic development, and urbanization, valuable arable land is being converted at alarming rates for commercial nonfarm uses. Infrastructural development, though necessary, is also rendering fertile lands to brick and mortar, leaving fewer areas for agricultural purposes
3. Dominance of Non-agricultural Lobbies: Decades of economic growth have brought fundamental changes in the relative power bases of different classes. Instead of the rural elite, the urban commercial and business classes are dominating the policy formulation process in the country. For them, agriculture and rural areas have a low priority for the allocation of resources.
4. Slow Economic Growth: The sluggish economic growth of the country may create a Catch-22 situation. Lower growth means fewer resources for overall development, and agriculture has always gotten stepmotherly treatment, which will adversely affect the agricultural growth rate. This, in turn, will again impact the overall growth rate and so on

Challenges for the Agricultural Sector of Pakistan

Pakistan’s agriculture sector is confronted with multiple challenges, stemming from both internal structural issues and external factors. Two of them are of paramount importance, namely food security, and producing raw materials for industry.

The challenge of ensuring food security for the rapidly increasing and becoming rich population of Pakistan is becoming acute in the backdrop of limited arable land, water scarcity, and the looming threat of climate change. Similarly, the challenge of producing sufficient raw materials to sustain the industrial sector with a limited resource base is also daunting. Consequently, Pakistan’s agriculture sector is faced with these five challenges:

1. Challenge of Productivity

Addressing the dilemma of enhancing productivity in agriculture is critical. The sector must find innovative solutions to maximize output while working within the constraints of limited resources, water shortages, and technological limitations. The goal extends beyond securing food for a growing population; it also encompasses producing surplus materials for industrial use and export. Therefore, improving agricultural productivity is essential for both food security and economic growth.

2. Challenge of Profitability

Ensuring that farmers receive fair and consistent returns for their labour and investments is imperative. Profitability is a linchpin in attracting individuals and entities to invest in the agriculture sector. Measures to improve profitability may include providing better access to credit, modernizing farming techniques, and facilitating the adoption of advanced technologies that increase yields and reduce costs.

3. Challenge of Competitiveness

To thrive in a globalized market, Pakistan’s agricultural produce must remain competitive in terms of international prices, whether it’s for domestic consumption or export. Reducing the operational costs of agriculture, optimizing supply chains, and adopting sustainable and efficient farming practices are all vital components of this challenge.

4. Challenge of Sustainability

The agricultural sector must grapple with the spectre of environmental degradation, exacerbated by factors such as land erosion, declining water resources, and the looming threat of climate change. Achieving sustainability requires the adoption of eco-friendly farming practices, water resource management, and proactive measures to mitigate and adapt to the impacts of climate change, thus safeguarding the long-term viability of agriculture.

5. Challenge of Equity

As improvements in productivity and profitability are sought, it is vital to ensure that the benefits are equitably distributed among all stakeholders in the agriculture sector. This includes both large and small-scale farmers, as well as labourers. Policies promoting equitable access to resources, fair pricing mechanisms, and social safety nets can help bridge the gaps in wealth distribution and promote inclusivity within the sector.

In addressing these challenges, Pakistan’s agriculture sector will not only secure its own future but also play a pivotal role in the country’s economic development, food security, and environmental sustainability. Collaborative efforts involving government policies, technological innovations, private sector investments, and community engagement will be essential in surmounting these multifaceted obstacles.

In my next article, I will discuss how to respond to these challenges

From the book “Pakistan Affairs: 25 Essays”, published by Amazon, and available at

Pakistan Affairs: 25 Essays