Agriculture In Pakistan

EXECUTIVE SUMMARY

In order to achieve full employment and raise its entire population above the poverty line by the year 2006-07, Pakistan needs to create additional employment for 100 million persons and raise the incomes of millions of under-employed persons. This report presents a program to achieve these goals utilizing the country's competitive advantage in labour-intensive agricultural crops and allied industries.

Misfortunes can happen to some very good products. One of the major reasons for such mishappenings, is that industries and organizations fail to realize the importance of a well-planned process of new or existing product development. They do not acknowledge that “ change is the only constant thing in this world” and as trends change it is important to change their products along with it too.

The objectives of the program are to double agricultural production in ten years, achieve complete nutritional self-sufficiency for the country, and generate millions in exports of sugar, fruits, vegetables, silk and cotton textiles. The program will generate a minimum growth rate of more than 4% in the agricultural sector.

New changes, are the lifeblood of companies. When firms do not change their level of production to meet the requirements of changing consumer desires, government regulations completion and a host of other factors: market share and profit usually decline. The life of a new industry often depends on how it conceives and produceses.

INTRODUCTION

Agriculture

Pakistan's principal natural resources are arable land, water, and extensive natural gas reserves. About 28% of Pakistan's total land area is under cultivation and is watered by one of the largest irrigation systems in the world. Agriculture accounts for about 24% of GDP and employs about 44% of the labor force. The most important crops are cotton, wheat, rice, sugarcane, fruits, and vegetables, which together account for more than 75% of the value of total crop output. Despite intensive farming practices, Pakistan remains a net food importer. Pakistan exports rice, cotton, fish, fruits, and vegetables and imports vegetable oil, wheat, cotton, pulses, and consumer foods.

The economic importance of agriculture has declined since independence, when its share of GDP was around 53%. Following the poor harvest of 1993, the government introduced agriculture assistance policies, including increased support prices for many agricultural commodities and expanded availability of agricultural credit. From 1993 to 1997, real growth in the agricultural sector averaged 5.7% but has since declined to less than 4%. Agricultural reforms, including increased wheat and oilseed production, play a central role in the government's economic reform package.

Role of agriculture in Pakistan.

ARTICLE (September 20 2006): Agriculture is a way of life, a tradition, which for centuries has shaped the economic life, culture and the thought of the people. The importance of agriculture in the development of a country cannot be ignored. Growth of agriculture is very much essential for achieving self-reliance in major food items.

Pakistan with a total land area of 79.61 million hectares is termed as an agricultural country because agricultural sector is the single largest sector of the country which not only provides food to 140 million people but also provides employment to about 48 % of the workforce. Beside, it also provides raw material to the industry, contributes about 60% to export earnings, and provides the livelihood for 70% rural population. In short the agriculture sector can rightly be called the backbone of our economy, as it contributes around Rs800 billion, almost one-fourth to the total GDP i.e. contributing 25% of the GDP.

However, the sector, which possesses the potential to be a lead sector in accelerating the economic growth and reducing poverty in Pakistan, has received less attention from successive governments in the past 57 years than other issues. According to the Economic Survey of Pakistan, this year the agricultural growth target came down to 2.6 percent from 4.1 percent of the last year i.e. 2004-05. The Survey also attributed the slippage in agriculture to the weak performance of both the major and minor crops. However, the government hesitated to accept its poor attention towards this important sector of the economy. Although, the government announced a comprehensive package for the farmers in June this year, it failed to satisfy the majority of the farming community as they are expressing their dissatisfaction over the incentives announced.

Agriculture is the single largest sector of the economy. It contributes 24 percent of the

GDP employs 48.4 percent of country’s workforce and is a major source of foreign exchange earnings. About 68% of the population lives in rural Pakistan and depends upon agriculture for sustenance.

The average annual growth rate of agriculture during 1990s was 4.5%. The highest growth rate of 11.7 percent was achieved in 1995-96 mainly due to increase in cotton, gram, milk and meat production. The sector touched the lowest negative growth rate of

5.3 percent in 1992-93 mainly due to decrease in cotton and sugarcane production.

The major crops as wheat, cotton, rice, sugarcane and maize account for 41% of value added and minor crops 10% in overall agriculture. Livestock has emerged as an important sub sector of agriculture. It accounts for 37.5% of agriculture value added and about 9.4% of the GDP. Similarly, fisheries play an important role in national income through export earnings.

Agricultural Policy

The agricultural sector is highly politicized because the majority of landowners have had considerable political influence. This has resulted in agricultural policy being steered towards supporting the production of major cash crops such as sugarcane, and exempting almost all agricultural income from taxes. However, following recent discussions with the IMF and World Bank on revenue collection in general, the present government is in the process of re-structuring the system to try and increase agricultural taxation. In addition, successive governments have extended considerable support to the sector by providing concessionary financing to farmers for the purchase of agricultural equipment (mainly tractors) and for building irrigation and drainage systems.

Three year Strategy