Daily Times

Pakistan Businesses Forum (PBF) on Sunday called upon the State Bank of Pakistan (SBP) to try and restructure its agricultural finance regime, as 90pc of farm loans were offered for production and only 6-10pc for agricultural development.

Similarly, 1.7pc of the total agri credit was distributed among farmers in Khyber Pakhtunkhwa, Balochistan, Azad Jammu Kashmir and Gilgit-Baltistan which is a worrying factor.

PBF Vice President Ahmad Jawad said in a statement “Give us the competitive agri financing, we will give you growth,” as the agriculture sector has the potential to reach 5pc of the GDP target.

He said that banks had no institutional means at their disposal to gather meaningful data about farms and rural businesses. The banks were not equipped to make informed investment decisions as far as Agri-financing was concerned.

And without formal financing, agricultural transformation was not possible. So, the country’s population would continue to face food shortage. Farmers were at the mercy of middlemen and local money lenders – though they at least bring some liquidity to farm operations, he added.

Alongside those financial hurdles, the agricultural production side had been suffering too, and provincial governments seemed to be exacerbating it with transparency issues. For instance, the government of Punjab, Pakistan’s most populous province, announced in January that it had arrived at a wheat sowing acreage target of 16.21m, down from its initial goal of 16.70m.

At the same time, it also announced massive expansions in sowing of potato and oil seed crops, citing those as cutting into the wheat goal.

Currently, as per the official data, agriculture contributes to 19.2pc of its GDP, employs 38.5pc of the country’s workforce and supports the livelihoods of at least 65-70pc of the population.

Agricultural production grew by 2.7pc nationwide in financial year 2019-20 and the trend continued into FY2020-21, despite the pandemic. However, in 2021-22 the numbers of the economic survey were purely the results of the efforts of the farmers.

However, during this period, under the Imran Khan government, Pakistan also shifted to being an importer from an exporter, with wheat and sugar as primary import commodities while the country was reeling under the pressure of food inflation.

Ahmad also stressed the need to “revamp the seed sector” and streamline distribution. He also called for the inclusion of more “agro-based projects” in China-Pakistan Economic Corridor (CPEC) to expand productivity in the country.