Undeniably, Pakistan is an agricultural economy. The argument that agriculture is less than 20 percent of GDP, and hence takes a backstage to the services sector actually does not gel for two reasons. Firstly, according to the Economic Survey of Pakistan 2015-16, agriculture remains by far the largest employer absorbing 42.3 percent of the country’s total labour force. And secondly, GDP is not the right parameter for any such conclusion. Service sector growth is driven by retail, finance, telecommunication and government services that are entirely domestic in nature, and hence in my view, at least largely irrelevant, while agriculture remains the biggest export-earner for Pakistan even today.
According to the State Bank of Pakistan data, for the period July 2015 to May 2016, textile and food group exports — both of which are directly dependent on agriculture — were approximately $15 billion, which is approximately 75 percent of total exports during the same period. If we were to add other indirectly related manufactures, such as leather, footwear and sports goods, we are perhaps looking at almost 80-85 percent. So if that does not make us an agriculture economy, I have no idea what does. The sad part is most of us are not even aware of who the man at the helm of agriculture in the government is, if there is one at all. The worse news is that agricultural GDP growth declined by 0.19 percent during this year, and exports fell by 20 percent.
Shockingly, except for sugar all major crops registered a decline, and while blaming climate may in theory shift responsibility it will not redress the challenges. By and large, the area under cultivation in respect of the five important crops — cotton, sugar cane, rice, maize and wheat — has remained stagnant for at least the last three years, and production declined for all these crops except sugar. While an expert might be in a better position to comment, from a layman’s perspective, sugar production consumes the highest amount of water, which in itself should be worrying in a country that is ranked as extremely high in terms of water stress by the World Resources Institute. If you go back to the table on Actual Surface Water Availability included in the Economic Survey of Pakistan 2015-16, you will note that the average availability has consistently decreased since 2007-2008. Again not an expert, and the decrease might be because of more land brought under cultivation, but that still does not sound right.
In a nutshell, a sector that is the backbone for employment, the biggest bread earner for the country and critical for self-sustainability should be the top priority for any government. This is not to say that government has been completely ignorant of the sector, as it has been maintaining perhaps one of the largest irrigation systems, providing subsidies on fertilizer, fixing support prices, subsidising electricity for tube wells and granting soft loans for farming, but all in all, nothing seems to be actually working. Even this budget contained a lot of incentives for the agriculture sector, and one can only hope that they work, because if the sector does not get cracking soon, the economy will face challenges that perhaps even China-Pakistan Economic Corridor may not be in a position to address.
Those of us unrelated to agriculture, by and large, still view rural agriculture in Pakistan rather dreamily with visions of farmers ploughing small pieces of owned or vassal land with the help of livestock, with a few tractors here and there, borrowing money from the informal economy to buy the inputs for his crop, throwing seeds for sowing, using fertilizer if his budget allows, praying for rain at the right time and praying harder for no rains at the wrong time, getting friends and family together at the time of reaping and storing his crop in open-air arrangements until someone can pay him just enough to terminate his loans and sustain him till the next crop. And if that does not happen he is history. Seriously, the direction in which things are moving today, if Pakistan were to be considered in isolation, with the population rising and agriculture production declining, we might just be the first country to prove Malthus’s theory of population.
Compare this with certain extracts, some rephrased, from the last Technology Quarterly report of The Economist on the future of agriculture:
Every half-hour, a carefully calibrated pulse of water based on the cloud’s calculations, and mixed with an appropriate dose of fertiliser if scheduled, is pushed through the tapes, delivering a precise sprinkling to each tree. With the new little-but-often technique, he uses 20 percent less water than he used to.
Sowing, watering, fertilising and harvesting are all computer-controlled. Even the soil they grow in is monitored to within an inch of its life. Farms, then, are becoming more like factories: tightly controlled operations for turning out reliable products, immune as far as possible from the vagaries of nature.
Fit its tractors and other mobile machines with global-positioning-system (GPS) sensors, so that they could be located to within a few centimetres anywhere on Earth. This made it possible to stop them either covering the same ground twice or missing out patches.
Equipment can plant individual seeds to within an accuracy of three centimetres.
Using a technique called multispectral analysis, which looks at how strongly plants absorb or reflect different wavelengths of sunlight, they can discover which crops are flourishing and which are not. Multispectral sensors mounted on a tractor’s spraying booms can estimate the nitrogen needs of crops about to be sprayed, and adjust the dose accordingly.
The above is not an exhaustive list, but was included to demonstrate how far technology has progressed as far as agriculture is concerned. Again for a layman, this is a Star Trek moment, and as Pakistanis we can only worryingly wonder where we are in terms of mechanised, rather computerised, farming, if at all anywhere. Are we even in the business of agriculture?
Financial and technology constraints are, however, not the only problems that the sector faces. A depilated and almost obsolete farm-to-market supply chain, poor storage facilities and middleman preying on the farmers are other tales of horror. The data on amount of wastage in case of crops, especially fruits, pulses and vegetables, shows absolutely horrendous percentages. Frankly, no amount of subsidies to farmers will address these issues, and the private sector is not expected to take the risk of developing what is considered to be largely public sector facilities.
Looking at agriculture as the backbone of Pakistan’s economy, the dilemma is to conclude whether education still takes priority over agriculture as the prime directive of any government. For my money, and experts may disagree with this, education requires resources, and therefore, agriculture supersedes it. To conclude, for Pakistan, it’s all about agriculture.
The writer is a chartered accountant based in Islamabad, and can be reached at email@example.com