The successive governments in Pakistan have been focusing on industrial sector and ignoring agriculture. The focus remained on import substitution rather than exploiting comparative advantage. This is evident from the fact that crop yields in Pakistan are lowest, even below those achieved in India. Both the countries enjoy similar land and climatic conditions but India has been focusing more on improving yield and has been successful to a large extent.
Under the prevailing conditions – looming energy crisis – the average capacity utilization of industries is on the decline, which is also rendering the local manufacturers uncompetitive in the global markets. Therefore, there is a need to focus on agriculture, which will help in boosting export of agri products, improve earnings of farmers and above all achieving foods security. The advantage can be further multiplied by boosting production of E-10 (gasoline containing 10% ethanol) and generating up to 3,000MW electricity at the sugar mills. Both these options can help in containing oil import bill, particularly motor gasoline and furnace oil.
Poor crop yield can be attributed to a number of factors that include: 1) continued use of seeds yielding lower output per acre, 2) imbalanced use of fertilizers, 3) floods/drought like situation and 4) failure to go for mechanized farming. All these factors are controllable some by the government and some by the growers. Some of the real problems are: 1) feudal lords availing most of the funds disbursed by the financial institutions, 2) pilfering large quantities of water when there is limited supply and diverting of gushing water to farms owned by small farmers in case of floods and 3) feudal buying properties in urban areas and expensive vehicles, rather than spending it on the procurement of high quality seeds, fertilizers and pesticides.
Lately, the State Bank of Pakistan (SBP) has been focusing on enhancing disbursement of funds among the farmers and efforts yielding positive results. The indicative target of lending to farmers for the current financial year is set at Rs315 billion, which is still a minuscule amount when compared with the overall lending to manufacturing sector. It is encouraging that financial institutions have gathered courage to lend more to the farmers after joining hands with the insurance companies. However, it is necessary to point out that state owned National Insurance Company (NIC) has failed in paying claims resulting from 2010 and 2011 floods. Let this point be kept in mind that NICL issues insurance cover for the loans disbursed by National Bank of Pakistan (NBP). It is also on record that NBP has got the largest share in lending to farmers among all the banks and its NPLs pertaining to agriculture are also the lowest.
Pakistan has got the largest man-made irrigation system of the world. However, the system faces dilapidation due to improper management, the worst example is Sukkur barrage, as many of its gates have become non-operative due to silting. Most of the canals are not cleaned and lined properly, which results in spillage and seepage, causing water logging and salinity problems. Every year billions of rupees are spent on LBDO and RBDO but large areas are getting submerged in saline water. Hyderabad and its adjoining areas, which are most suitable for cultivation of sugarcane because of higher yield and recovery, are being affected.
Pakistan faces either drought-like situation or floods depending on the rain fall. The problem is multiplied because the country does not have adequate water storage facilities. Since completion of Tarbella dam in 1976 no new mega dam has been constructed. Policy planners face ‘egg or chicken first’ situation. They say since limited quantity of water is available in rivers there is no need to construct water storage facilities. After 2010, they were told that Pakistan will face more intense and more frequent deluge but no attention was paid and country faced devastation in 2011, though of a lesser magnitude. Policy planners fail to understand that reservoirs have to be built to preserve water for ensuring adequate supply of water, when the country faces drought like situation.
As stated earlier the country suffers from poor yield, which can be improved by using high yielding varieties, applying proper dosage of fertilizers and spraying pesticides. Some of the quarters are trying to promote ‘genetically modified seeds’. Interestingly these seeds are not being used in the country of origin but being dumped in third world countries, including Pakistan. While domestic research institutions are suffering from shortage of funds and often being not allowed to work on development of new varieties, one of the US-based seed marketing companies has been given free hand.
It is on record that in the past cotton fields repeated came under curl leaf virus (CLV) attack, which was attributed to cultivation of varieties susceptible to such attacks. Even at that time it was alleged that foreign seed supplier was responsible for supplying infected seed. One can also recall that seeds coming in container loads were burnt at Karachi port, after these were founded contaminated. It was also alleged that this happened after Pakistan got record production of nearly 13 million bales and in the subsequent years production was reduced to nearly half.
Pakistan has undertaken various land reforms, which have led to fragmentation of land holding to ‘uneconomic sizes’. Therefore, the time has come for another set of land reforms for consolidating landholding. If the country wishes to achieve food security it has to focus on mechanized farming. This has become all the more important because of limited availability of water. Laser-aided leveling can help in revamping of water courses so that farms at the ‘tail end’ could also get water. There is also a need for lining of canals to save water as well as contain seepage.
Last but not the least there is also a need to bring down fertilizer prices in the country. Nearly 60 percent of the recent hike in urea price was the outcome of imposition of GST, GIDC and hike in feedstock price. Country has attained the capacity to produce 1.2 million tons surplus urea and ensuring adequate gas supply to fertilizer plants can help in earning over half a billion dollars from export of surplus urea, besides easing prices in the domestic market.