Agriculture: A Rare Bright Spot in Pakistan's Economy

by Riaz Haq

Jun 13, 2024

Pakistan's agriculture sector grew 6.3% in 2023-24, far outpacing the overall economy that grew just 2.38%, according to the Economic Survey of Pakistan 2023-24.  This is good news for about 40% of the country's population working in the agriculture sector. By contrast, India's agriculture growth slowed to 1.2% in recent quarters. Studies have shown that strong growth in agriculture helps reduce poverty in developing nations like India and Pakistan. 

Snapshot of Pakistan's Economy. Source: Economic Survey of Pakistan 2023-24

The agriculture growth in Pakistan was the highest in 19 years. All major crops saw significant increases. Wheat output jumped 11.6% from 28.2 million tons last year to 31.4 million tons this year, the economic survey said. Cotton, severely damaged by floods and rains last year, reached 10.2 million bales compared to 4.9 million bales last year, growing by 108.2%. Rice output also saw a significant increase — up by 34.8% — reaching 9.9 million tons compared to 7.3 million tons. 

Strong crop output is in part the result of higher yields from increased water and fertilizer availability to farmers, according to the economic survey. 

The survey said the water availability during Kharif 2023 increased to 61.9 million acre-feet (MAF) from 43.3 MAF in Kharif 2022 (when the floods hit). For Rabi 2023-24, the water availability was 30.6 MAF, showing an increase of 4.1% over Rabi 2022-23.

Domestic fertilizer production during FY24 (July-March) rose by 17.3% to 3.25 million tons compared to 2.77 million tons in the same period of FY23. Fertilizer imports also increased by 23.7%, reaching 524,000 ton­s. The availability of fertilizer increased by 18.1% to 3.77 million tons. 

Pakistan's Rice Exports Soared 80% in Current Fiscal Year. Source: FT

The value of Pakistan’s rice exports soared to $3.6 billion over the last 11 months, up from $2 billion in July to May 2022-23. Its previous record for was 4.8 million metric tons of rice exports, valued at about $2.5 billion in 2021-22, according to the Financial Times. 

Pakistan is among the world's largest food producing countries. It produces large and growing quantities of cereals, meat, milk, fruits and vegetables. Currently, Pakistan produces about 38 million tons of cereals (mainly wheat, rice and corn), 17 million tons of fruits and vegetables, 70 million tons of sugarcane, 60 million tons of milk and 4.5 million tons of meat.  Total value of the nation's agricultural output exceeds $70 billion.  Improving agriculture inputs and modernizing value chains can help the farm sector become much more productive to serve both domestic and export markets.  

Agriculture is considered a key tool for reducing poverty in developing countries like Pakistan. It employs almost half of the rural workforce, contributes around 20% to the country's GDP, and provides raw materials for agro-based industries, according to a study by Yaping Liu, Asad Amin, Samma Faiz Rasool, and Qamar Uz Zaman.  However, some studies suggest that agriculture may only help mitigate rural poverty in the long term, while other sources say that sustainable agriculture practices can significantly improve agricultural production and reduce poverty.

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  • Riaz Haq

    Pakistan’s expert discovers seed tech in China during an event held in China under the Asian Seed Association.

    https://thedailycpec.com/pakistans-expert-discovers-seed-tech-in-ch...

    The Asian Seed Congress (ASC), the premier annual event of the Asian Seed Association (APSA), took place in Sanya, Hainan, China, from December 2 to December 5, with the theme “Riding the Wave of Growth in Asia Pacific.” Since its establishment in 1994, ASC has rotated its location yearly across different countries or regions within the Asia-Pacific. This year marked its 29th edition, setting a record with over 1,500 participants from 52 nations, making it the largest gathering in APSA’s history.

    Dr. Rasheed, a seasoned agribusiness expert with more than 15 years of experience, represented Pakistan at the congress. Eager to stay abreast of emerging trends and establish partnerships, he expressed particular interest in vegetable seeds, including chili, tomato, melon, and watermelon. “This is my seventh Asian Seed Congress,” shared Dr. Rasheed, currently serving as the research advisor for Pakistan’s Patron Group. He was particularly intrigued by the trade exhibition, where global seed companies showcased their best varieties, while Chinese exhibitors highlighted cutting-edge biotechnologies.

    Dr. Rasheed observed an impressive range of biotechnologically engineered seeds resistant to various environmental and biological challenges. These advancements, he noted, have the potential to significantly enhance agricultural yields in Pakistan.

    Pakistan’s seed industry holds immense promise within the Asia-Pacific seed market, valued at $29.7 billion, contributing 32% of the global seed market. The region’s seed use is equally significant, with 26.9 billion tonnes, representing nearly 40% of the global total. Such collaborations, Dr. Rasheed remarked, could drive growth and innovation within Pakistan’s agriculture sector.

    Highlighting the strong collaboration between Pakistan and China in the seed industry, Dr. Rasheed pointed out China’s extensive seed trade network spanning 116 countries. Hybrid rice, a notable achievement, has been successfully introduced and scaled in regions such as Asia and Latin America. As China’s strategic partner and close neighbor, Pakistan is well-positioned to benefit from and expand such cooperative efforts.

    Hybrid rice has proven transformative for Pakistan. Following years of trials, the country has reached a milestone by exporting hybrid rice to third-party markets, symbolizing a significant achievement in agricultural collaboration between China and Pakistan.

    Dec 12, 2024

  • Riaz Haq

    Also known as maize, corn’s success story has, to a large extent, been buried under the media attention that the politics of sugar and wheat usually garner. Yet, maize yields have tripled over the last two decades and according to a report by the Pakistan Business Council (PBC), production has surged over six times – going from 1.6 million tons to 10.6 million tons – a growth that stems from private sector investment, particularly in the form of the import of hybrid seeds and significantly by the absence of government intervention.

    For context, about two-thirds of Pakistan’s total corn production of approximately 10 million tons is used for poultry feed, and the remaining is for livestock fodder and other commercial purposes as well as human consumption. While demand is mainly driven by the poultry feed and the dairy sector, corn has myriad applications for consumer goods as well as intermediate goods in the manufacturing sector. In fact, every part of the corn kernel finds a use; the oil is extracted from the germ, starch goes to industry for various products, protein is dried for poultry feed, and fibre is dried for cattle feed.

    https://aurora.dawn.com/news/1145082

    Dec 21, 2024

  • Riaz Haq

    State Bank of Pakistan highlights growth in credit disbursement, SME financing, and policy measures to support business sectors.

    : Credit disbursement to Pakistan’s agriculture sector has surged to Rs. 1.26 trillion by the end of the first half of the financial year 2025 (FY25), nearing its full-year target of Rs. 2.5 trillion set by the banking regulator for commercial banks. This was revealed by the Governor of the State Bank of Pakistan (SBP), Jameel Ahmad, during a meeting with business leaders at the Multan Chamber of Commerce and Industry.

    Governor Ahmad attributed the robust credit growth to the SBP’s prudent monetary policy, which has contributed to restoring macroeconomic stability. He also highlighted several key policy initiatives aimed at improving the ease of doing business, including measures for export and import facilitation, dividend repatriation, support for freelancers and IT exporters, and strengthening the digital ecosystem.

    Furthermore, he noted a significant increase in SME financing, which rose from Rs. 543 billion in December 2023 to Rs. 638 billion in December 2024. The governor emphasized the importance of diversifying exports and encouraged the business community to invest in future technologies and explore non-traditional markets.

    It’s worth noting that in the previous fiscal year, credit disbursement to the agriculture sector reached Rs. 2.216 trillion, demonstrating the sector’s vital role in the country’s economic framework

    Jan 30