JAVAID ASHRAF

3B
129

REPORT WRITING

AGRICUTURE OF PAKISTAN

INTRODUCTION:
Agricultural sector is indispensable to the country’s economic growth, food
security, employment generation and poverty alleviation particularly, at the rural level. It contributes
19.2 percent to the GDP and provides employment to around 38.5 percent of the labour force. More
than 65-70 percent of the population depends on agriculture for its livelihood. Agricultural growth rate
has been constrained by shrinking arable land, climate change, water shortages, and large-scale
population and labour shift from rural to urban areas. Increasing agricultural productivity, therefore,
requires adoption of new approaches. With strong forward and backward linkages with the secondary
(industrial) and tertiary (services) sectors, it can play a pivotal role to spur economic growth. However,
this sector has remained prone to several challenges like climate change, variance in temperature, water
shortage, and changes in pattern of precipitation along with increase in input prices. The government is
closely monitoring key crops and devising policies/planning interventions to ensure uninterrupted
supply of basic food items at affordable prices in the country. The primary goal of the government is to
enhance financial inclusion in the agriculture sector to boost productivity and exports, thereby enabling
a rural development-driven economic growth. Realising the importance of agriculture, the government
is also focusing on proagriculture set of policies to tap maximum benefits by introducing the agri-input
regime to increase yields of major rabi and kharif crops. The Prime Minister has approved “Agriculture
Transformation Plan” with the objective to enhance national agricultural output and livelihood of
farmers.

Agriculture Performance during 2020-21:

Pakistan has two cropping seasons. “Kharif”, the
first sowing season, which starts from April to June and is harvested from October to December. This
season crop cycle mainly consists of rice, sugarcane, cotton, maize, moong, mash, bajra and jowar.
"Rabi", being the second season, sowing begins from October to December and is harvested from April
to May. It comprises mainly of wheat, gram, lentil (masoor), tobacco, rapeseed, barley and mustard. The
agriculture sector’s performance during 2020-21 broadly stands encouraging as it grows by 2.77 percent
against the target of 2.8 percent. The growth of important crops (wheat, rice, sugarcane, maize and
cotton) during the year is 4.65 percent. The production of major Kharif crops 2020, such as sugarcane,
maize and rice indicated considerable improvement compared to last year and surpassed the production
targets. The production of sugarcane increased by 22.0 percent to 81.009 million tonnes from 66.380
million tonnes, rice by 13.6 percent to 8.419 million tonnes from 7.414 million tonnes and maize by 7.4
percent to 8.465 million tonnes from 7.883 million tonnes. However, the cotton crop suffered mainly
due to decline in area sown, heavy monsoon rains and pest attacks. The cotton production reduced by
22.8 percent, to 7.064 million bales from 9.148 million bales last year. Wheat, the most important crop
of “Rabi”, showed a growth of 8.1 percent and reached record high production level of 27.293 million
tonnes compared to 25.248 million tonnes last year. The wheat cultivation area increased to 9.178
million hectares prompted by record domestic prices and official programmes promoting wheat
production. For the Rabi crops 2020-21, the government provided a comprehensive Agriculture 19 “Rabi
Package” comprising of subsidies on fertilizer, fungicides and weedicides, together with an increase in
the Minimum Support Price (MSP) of wheat to Rs 1,800 per 40 Kg. Other crops, having a share of 11.69
percent in agriculture value addition and 2.24 percent in GDP, showed growth of 1.41 percent because
of increase in production of fodder, vegetables and fruits. Cotton ginning declined by 15.58 percent due
to fall in production of cotton crop. The overall crops sector, having a share of 35.81 percent in
agriculture value addition and 6.87 percent in GDP witnessed a growth of 2.47 percent due to increase
in growth of important crops by 4.65 percent.

I. Crop Situation:
The important crops contribute 22.49 percent to value addition in agriculture
sector and 4.32 percent to GDP. Other crops account for 11.69 percent in value addition of agriculture
sector and 2.24 percent in GDP.

a) Important Crops
i) Cotton:
Cotton crop stands vital in agriculture as well as textile sector of the economy. It
contributes around 0.6 percent to GDP and 3.1 percent of the value added in agriculture. Cotton crop
faces multiple challenges and competes with other crops especially sugarcane. International prices also
play a role. Being an export oriented raw material of textile industries, maintaining prices at levels
competitive with the international market while ensuring due profitability of growers has been a great
challenge for policy makers. During 2020-21, the crop was cultivated on 2,079 thousand hectares,
reflecting a contraction of 17.4 percent as compared to last year’s sown area of 2,517 thousand
hectares. Production declined by 22.8 percent to 7.064 million bales against production of 9.148 million
bales last year

ii) Sugarcane
Sugarcane is a high value cash crop of Pakistan and is of great significance for sugar related industries,
second largest agro-industry sector after textile. Its production accounts for 3.4 percent in agriculture’s
value addition and 0.7 percent in GDP. During 2020-21, the crop was cultivated on 1,165 thousand
hectares, an increase of 12.0 percent compared to last year’s sown area of 1,040 thousand hectares.
Production increased by 22.0 percent to 81.009 million tonnes against 66.380 million last year. The crop
experienced a significant increase in area under cultivation and yield. It was mainly due to favourable
weather conditions, better management, timely availability of quality inputs and higher economic
returns. The area, production and yield of sugarcane during the last five years

iii) Rice
Rice is an important food as well as cash crop. It is the second main staple food crop after wheat and
the second major exportable commodity after cotton. It contributes 3.5 percent of value added in
agriculture and 0.7 percent in GDP. Rice production comprises of basmati (fine) and coarse types. During
the last few years, production of coarse types is increasing. During 2020-21, the crop was cultivated on
3,335 thousand hectares, reflecting an increase 9.9 percent as compared to last year’s sown area of
3,034 thousand hectares. The current year witnessed a record production growth of 13.6 percent to
8.419 million tonnes against 7.414 million tonnes last year.

iv) Wheat
Wheat is Pakistan’s main staple crop and, therefore, essential for the food security of the country. It
accounts for 9.2 percent of the value added in agriculture and 1.8 percent of the GDP. Self-sufficiency in
wheat has been a core objective of every government. During 2020-21, area under cultivation increased
by 4.2 percent to 9,178 thousand hectares over last year’s sown area of 8,805 thousand hectares. Wheat
crop recorded historic high production of 27.293 million tonnes showing an increase of 8.1 percent over
25.248 million tonnes production of last year. This was primarily due to the increase in cultivated area,
along with the shift of policies towards supporting wheat crop through increase in MSP for the crop. The
MSP in 2020-21 increased from Rs 1,400 to Rs 1,800 per 40 Kg, a 29 percent hike. The position over the
last five years

v) Maize
Maize is the third important cereal crop of Pakistan after wheat and rice. It contributes 3.4 percent to
the value added in agriculture and 0.6 percent to GDP. Maize is cultivated as a multipurpose crop for
food, feed and fodder. While human consumption is declining, its utilization in feed and wet milling
industry is growing at a fast pace. During 2020-21, maize was cultivated on an area of 1,418 thousand
hectares reflecting an increase of 1.0 percent over last year’s 1,404 thousand hectares. Its production
increased by 7.4 percent to 8.465 million tonnes compared to last year’s production of 7.883 million
tonnes. The production increase was largely due to increase in area, availability of improved variety of
seed, and better economic returns. Last five years

b) Other Crops
During 2020-21, Gram production declined by 47.6 percent to 266 thousand tonnes on account of
decline in area, yield and unfavourable weather conditions. The production of Bajra and Jowar also
witnessed a decrease of 30.7 percent and 20.0 percent respectively due to a decrease in area under
cultivation. The production of Barley, Rapeseed & Mustard and Tobacco remained at the last year
production level. The area and production of other crops
i) Oilseeds
During FY2021 (July-March), 2.917 million tonnes of edible oil of value Rs 574.199 billion (US$ 3.419
billion) was imported. Local production of edible oil during this period is provisionally estimated at 0.374
million tonnes. Total availability of edible oil from all sources is estimated at 3.291 million tonnes.

II. Farm Inputs

i) Fertilizer
Pakistan meets around 84 percent of its fertilizer requirement through local production while the
remaining is met through imports. Pakistan Economic Survey 2020-21 26 Domestic production of
fertilizers during FY2021 (July-March) increased by 5.9 percent over the same period of previous year.
This increase was mainly due to the supply of gas to Pak Arab Fertilizer from Mari Petroleum Company
Limited. The imported supply of fertilizer decreased by 20.1 percent, while the total availability of
fertilizer increased slightly by 0.3 percent during the period. There was an upsurge in total offtake of
fertilizer nutrients by 15.2 percent. Nitrogen offtake witnessed an upward trend of 13.2 percent,
phosphate of 20.0 percent and potash of 39.3 percent during FY2021 (JulyMarch). One of the major
reasons for the healthy growth in fertilizer usage was the increase in support price of wheat. Price of
urea decreased by 12 percent while DAP increased by 12.2 percent. As a result of a reduction of Gas
Infrastructure Development Cess (GIDC) to Rs 5/MMBTU, the cost of urea decreased by Rs 398 per bag
with effect from 28th January, 2020. Following are the different types of subsidies provided by the
government during FY2021.  Subsidy in the form of cheap natural gas used as feed for fertilizer
production (Rs 865 per bag of urea as per fuel and feed price difference)  Subsidized LNG for
production of urea from Fatimafert and Agritech (Rs 479 per bag)  Cash subsidy by Government of
Punjab for phosphate and potash fertilizer (Rs 500 per bag of DAP and SOP and equivalent for other
phosphate and potash fertilizers based on percent nutrient content) Total availability of urea during
Kharif 2020 was 3,695 thousand tonnes, comprising of 591 thousand tonnes of opening inventory and
3,104 thousand tonnes of domestic production (Table 2.12). Urea offtake was about 3,188 thousand
tonnes, leaving an inventory of 473 thousand tonnes for Rabi 2020-21. Availability of DAP was 1,456
thousand tonnes comprising of 500 thousand tonnes of opening inventory, 547 thousand tonnes of
imported supplies and 409 thousand tonnes of local production. DAP offtake was 1,162 thousand tonnes
leaving an inventory of 297 thousand tonnes for the upcoming Rabi 2020-21. Rabi 2020-21 started with
an opening balance of 473 thousand tonnes of urea (Table 2.12). Domestic production during Rabi 2020-
21 would be 3,017 thousand tonnes. Urea offtake during current Rabi 2020-21 was 3,220 thousand
tonnes, against 3,490 thousand tonnes of total availability, leaving a closing balance of 304 thousand
tonnes for next season. DAP availability during Rabi 2020-21 is estimated at about 1,162 thousand
tonnes, which includes 297 thousand tonnes of opening inventory, 518 thousand tonnes of imported
supplies and domestic production of 347 thousand tonnes. Offtake of DAP during Rabi season will be
about 1,059 thousand tonnes, leaving a balance of 101 thousand tonnes for next season. The total
availability of urea during Kharif 2021 will be about 3,536 thousand tonnes comprising of 304 thousand
tonnes of opening balance and 3,232 thousand tonnes of domestic production (Table 2.12). Urea offtake
is expected to be around 3,033 thousand tonnes, reflecting closing balance of 503 thousand tonnes. The
total availability of DAP will be 566 thousand tonnes against expected offtake of 1,012 thousand tonnes.
Supply and demand gap will be filled through imported supplies by the private sector
3. Establishing a System of Consumer Traceability for Seed Authenticity
MNFS&R with the help of National Telecommunication Corporation (NTC) is in the process of
establishing a system of track and traceability of seed produced by seed companies, certified by FSC&RD
and sold by seed dealers. In this respect, a system of unique algorithmic labels will be introduced which
farmers will be able to verify through SMS. Developing a Seed Information Management System for
FSC&RD is also part of the interventions which will be a step forward in transforming manual data
recording to digitize FSC&RD services. This will not only provide access to real time data but will also
improve the efficiency and transparency in activities pertaining to seed quality regulation. Track and
Traceability of Certified Seed FSC&RD in collaboration with provincial extension departments has started
track and traceability of certified seed so that the impact of these interventions can be calculated at
farm level. In this regard, a unified format has been designed for major crops i.e., wheat, cotton and
paddy. A total of 434 companies working on wheat were assessed for seed traceability of 513,519 MT
seed, of which data was traced for 361,408 MT i.e. 87.4 percent. Services of 110 companies with respect
to wheat seed testing were deferred owing to failure in providing traceability data or huge traceability
gaps. The information regarding sale of cotton certified seed to dealers by the seed companies is being
shared with provincial extension departments for traceability of certified seed at farmer level.

iii) Farm Mechanization

Farm mechanization is an important element to accelerate growth in agriculture sector and its lack is a
main constraint in increasing agricultural productivity. The federal government continued the relief
package that allows import of farm machinery and Agriculture 29 equipment at reduced tariff (Custom
Duty 0-2 percent and GST 07 percent) to encourage mechanized farming in the country. The domestic
tractor industry has played a significant role in fulfilling the requirements of tractors. The number of
operational tractors in the country is around 612,000 resulting in availability of around 0.09 horsepower
(HP) per acre against the required power of 1.4 HP per acre. During 2020-21 (July-March), total tractor
production was 36,653 compared to 23,266 produced last year, a 57.5 percent increase. The production
increase was largely due to an improved liquidity position of farmers. The prices and production of
locally manufactured tractors

Way Forward:
Agriculture sector has a strong linkage with food security and growth of other sectors of economy. The
present government has assigned high priority to growth of agriculture sector on sustainable basis and is
implementing the most appropriate policies to achieve the desired outcome. The government’s
Rabi/Kharif packages for growth of agriculture will further improve its output and trickle down to
farmers. The emphasis is on the use of better quality seed, and modern technologies to ameliorate
agriculture outlook and food security