Agriculture is the single largest sector of Pakistan’s economy, making up nearly 20 percent of the country’s gross domestic product (GDP). The sector employs 42 percent of the country’s labour force. Of the women who work, 72 percent work in agriculture and livestock. As such, it’s an important sector - which is why low growth registered over the past decade has been of great concern. It was only in the last fiscal year that crop production improved somewhat and agricultural growth rates crossed 3 percent – the highest in a decade. Otherwise, it has been a long story of stagnation.
What happens in the agriculture sector affects the majority of Pakistanis, directly or indirectly. According to the latest census, there are 135 million people living in rural areas. Even if one makes an adjustment for peri-urban areas, which are not counted separately, it would still put nearly 100 million people in the countryside, dependent on land in one way or another. The incidence of poverty is highest in this group. The United Nation Development Programme’s (UNDP) multidimensional measure of poverty places rural poverty in Pakistan at a little over 50 percent overall. This varies between provinces: it is close to 58 percent in Balochistan and 54 percent in Sindh. By any standards, these are an alarming estimates. Many of the poorest are those who work on land without owning any. They are also highly likely to be malnourished, food insecure and vulnerable to disease. It would be inhuman to expect their productivity to be any higher than it is.
Given this history, and the key role of agriculture in the economy and for employment, it is interesting that there is little focus on agricultural policy in Pakistan in general. Agriculture is a devolved sector, so it is really up to the provinces to do the needful on policy and planning for the sector. The government of the Punjab has made a start by commissioning a draft policy nearly a year ago, but for the most part, the province has focused on implementing the Chief Minister’s Kissan Package, and more recently, a policy reform programme funded by the World Bank. As of now, there is no final agricultural policy covering key issues for the entire sector of the province. Sindh has been talking about issuing an agricultural policy but things don’t seem to have gotten beyond a few preliminary drafts. Balochistan has nothing in the pipeline. The only province to have actually issued an agriculture policy with a ten-year plan Khyber Pakhtunkhwa, which, in the context of Pakistan as a whole, has a very small contribution to overall agricultural GDP. It is commendable that they have taken the initiative, becoming the first province post-devolution to have done so.
So why this lack of interest in developing a comprehensive plan for agriculture in three out of four provinces, including the two that are responsible for the bulk of agricultural output?
One possible reason may be that there is just too much to tackle. The sector is wracked by low productivity. The number of people dependent on it for their livelihoods is growing unsustainably - population growth rates are higher in rural areas than in urban settlements - and this is a largely unskilled workforce. Land, the basic unit of production, is subject to fragmentation due to laws of inheritance and there is now a proliferation of small, unproductive landholdings in all provinces. There is a crisis of inputs, particularly water, which requires complex engineering and management solutions and perhaps even sensitive international diplomacy at the highest level. The government is a big player in agricultural markets, and has instituted all kinds of inefficiencies. The sector is subject to ravages of nature, which are becoming more intense due to the effects of climate change. One can go on and on.
Perhaps the single biggest reason is that tinkering too much with agriculture, particularly in the functioning of markets, hits hardest in lobbies that all governments are loath to provoke. A truly insightful and potentially effective policy would probably begin by taking cognizance of the woefully unequal distribution of productive resources in the sector and the fact that while only two percent of households own more than 50 acres of land, their holdings constitute almost a third of all arable land in the country. Not to mention the other inconvenient truths. That the input subsidies, on seed and fertilizer in particular, are designed to benefit large farmers, based as many of them are on purchase. That nobody is willing to pay for the use of irrigation water, and that those who use it the most are in a position to ensure that rates remain laughably low. That organization of agricultural marketing is the preserve of a few government appointed officials who are obliged to large landlords, and that any attempt to change this is likely to result in a cessation of the flow of produce. And so it goes.
It is yet another story of how entrenched lobbies have the ear of the government as opposed to the populace at large. As long as the legislature continues to house a disproportionate number of people from the two percent of large land holding families, nothing much will change.
What happens in the agriculture sector affects the majority of Pakistanis, directly or indirectly. According to the latest census, there are 135 million people living in rural areas. Even if one makes an adjustment for peri-urban areas, which are not counted separately, it would still put nearly 100 million people in the countryside, dependent on land in one way or another. The incidence of poverty is highest in this group. The United Nation Development Programme’s (UNDP) multidimensional measure of poverty places rural poverty in Pakistan at a little over 50 percent overall. This varies between provinces: it is close to 58 percent in Balochistan and 54 percent in Sindh. By any standards, these are an alarming estimates. Many of the poorest are those who work on land without owning any. They are also highly likely to be malnourished, food insecure and vulnerable to disease. It would be inhuman to expect their productivity to be any higher than it is.
Given this history, and the key role of agriculture in the economy and for employment, it is interesting that there is little focus on agricultural policy in Pakistan in general. Agriculture is a devolved sector, so it is really up to the provinces to do the needful on policy and planning for the sector. The government of the Punjab has made a start by commissioning a draft policy nearly a year ago, but for the most part, the province has focused on implementing the Chief Minister’s Kissan Package, and more recently, a policy reform programme funded by the World Bank. As of now, there is no final agricultural policy covering key issues for the entire sector of the province. Sindh has been talking about issuing an agricultural policy but things don’t seem to have gotten beyond a few preliminary drafts. Balochistan has nothing in the pipeline. The only province to have actually issued an agriculture policy with a ten-year plan Khyber Pakhtunkhwa, which, in the context of Pakistan as a whole, has a very small contribution to overall agricultural GDP. It is commendable that they have taken the initiative, becoming the first province post-devolution to have done so.
So why this lack of interest in developing a comprehensive plan for agriculture in three out of four provinces, including the two that are responsible for the bulk of agricultural output?
One possible reason may be that there is just too much to tackle. The sector is wracked by low productivity. The number of people dependent on it for their livelihoods is growing unsustainably - population growth rates are higher in rural areas than in urban settlements - and this is a largely unskilled workforce. Land, the basic unit of production, is subject to fragmentation due to laws of inheritance and there is now a proliferation of small, unproductive landholdings in all provinces. There is a crisis of inputs, particularly water, which requires complex engineering and management solutions and perhaps even sensitive international diplomacy at the highest level. The government is a big player in agricultural markets, and has instituted all kinds of inefficiencies. The sector is subject to ravages of nature, which are becoming more intense due to the effects of climate change. One can go on and on.
Perhaps the single biggest reason is that tinkering too much with agriculture, particularly in the functioning of markets, hits hardest in lobbies that all governments are loath to provoke. A truly insightful and potentially effective policy would probably begin by taking cognizance of the woefully unequal distribution of productive resources in the sector and the fact that while only two percent of households own more than 50 acres of land, their holdings constitute almost a third of all arable land in the country. Not to mention the other inconvenient truths. That the input subsidies, on seed and fertilizer in particular, are designed to benefit large farmers, based as many of them are on purchase. That nobody is willing to pay for the use of irrigation water, and that those who use it the most are in a position to ensure that rates remain laughably low. That organization of agricultural marketing is the preserve of a few government appointed officials who are obliged to large landlords, and that any attempt to change this is likely to result in a cessation of the flow of produce. And so it goes.
It is yet another story of how entrenched lobbies have the ear of the government as opposed to the populace at large. As long as the legislature continues to house a disproportionate number of people from the two percent of large land holding families, nothing much will change.