As per the statistics released by the Government of Pakistan, agriculture sector, contributing 22.9 per cent in Gross Domestic Product (GDP) and 37.4 per cent in employment generation, ensures food security and offer raw material to the industrial sector.
Agriculture is also a source of foreign exchange earning and significant for sustainable growth. However, from last couple of years, Pakistan observed climatic shocks which unfavorably affected this sector. This sector’s productivity is extremely sensitive to the frequency of adverse climatic events. More severely, the prolonged precipitation patterns increase river and inland water levels, resulting in flash and seasonal river and urban flooding commonly experienced in the recent past.
During July-August 2022, our country witnessed an unprecedented episode of territorial rains followed by flash flooding that damaged primarily two main subsectors, i.e., crops and livestock. Pakistan contributes not even 1 per cent of worldwide greenhouse gas emissions but is ranked among the top 10 climate-affected states. Moreover, damages in agriculture sector had spillover effect on industry and allied services sectors.
Resultantly, domestic production remained below the required levels, raising the prices of all essential food items to historic high. Restoring the livelihoods of subsistence farmers and livestock keepers was urgent and time sensitive, so that agriculture and livestock activities may be restored to their normal level before the Rabi season. Despite some advancement in the sector, problems still persist. Issues like lack of access to modern technology in remote areas, water scarcity and the need for continuous policy evolution require serious and immediate attention.
Looking ahead, the future seems promising, provided there is a continuous commitment to innovation, sustainable practices and comprehensive support for the farming community.
State Bank of Pakistan (SBP) has allocated the indicative agricultural credit disbursement target of Rs1,819 billion for FY2023, which is 28.2 per cent higher than last year’s disbursement of Rs1,419 billion. During FY2023 (July-March), the agriculture lending financial institutions disbursed Rs1,222 billion, which was 67.2 per cent of the overall annual target and 27.5 per cent higher than Rs958.3 billion disbursed during the same period last year. Further, the outstanding portfolio of agricultural loans increased by Rs80.2 billion and stood at Rs712.9 billion at end March 2023 compared to Rs632.7 billion at close March 2022, witnessing 12.7 per cent growth. In terms of outreach, the number of outstanding borrowers has reached 3.04 million in March 2023.
Cotton
Statistics showed that during FY2022-23, cotton crop was drastically damaged because of the climatic changes. During FY2023, cotton recorded 0.3 per cent contribution to GDP and 1.4 per cent to the value added in agriculture. During 2022-23, cotton area sown increased to 2,144 thousand hectares against 1,937 thousand hectares previous year, revealing a growth of 10.7 per cent. However, because of floods that swept away the entire crops in Sindh & Balochistan its production remained low at 4.910 million bales against last year’s 8.329 million bales, explaining a dip of 41.0 per cent. In Punjab, cotton producing districts Rajanpur, D.G. Khan and Taunsa were worst hit and damaged the cotton crop. Moreover, the insect pests, mainly Pink bollworm, Whitefly and Thrips remained prevalent during the season.
Rice
Rice is the second main staple food crop and second major exportable commodity after cotton. It contributes 1.9 per cent of value added in agriculture and 0.4 per cent in GDP. During 2022-23, the crop was cultivated on 2,976 thousand hectares, registered decline of 15.9 per cent over 3,537 thousand hectares previous year. Its production fell from 9.323 million tonnes in 2021-22 to 7.322 million tonnes in 2022-23, recording a negative growth of 21.5 per cent. Rice production, however, is lower than last year. This less production in combination with high input prices has caused increase in paddy price.
Sugarcane
Sugarcane provides raw material to the second largest agro-based sugar industry over the country. It provides employment to millions of rural farming and non-farming community. Its production accounts for 3.7 per cent in agriculture’s value addition and 0.9 per cent in GDP. During 2022-23, sugarcane was cultivated on 1,319 thousand hectares explaining increase of 4.7 per cent compared to 1,260 thousand hectares last year. The main factor contributed to more area sown were lucrative market prices of last year. Its production grew by 2.8 per cent to 91.111 million tonnes over last year.
Maize
Maize contributes 3.0 percent value added in agriculture and 0.7 per cent to GDP. During FY2022-23, maize crop was cultivated on 1,720 thousand hectares, explaining rise of 4.1 per cent over last year’s cultivation of 1,653 thousand hectares. However, its production grew by 6.9 per cent to 10.183 million tonnes from 9.525 million tonnes last year. As such, the increase in production was mainly because of increase in area sown and improved yield.
Wheat
During FY2022-23, wheat was cultivated on 9,043 thousand hectares against last year’s area of 8,977 thousand hectares registered rise of 0.7 per cent. Wheat contributes 8.2 per cent value added in agriculture and 1.9 per cent to GDP. The production of wheat reached at 27.634 million tonnes as against to 26.208 million tonnes last year, a growth of 5.4 was observed in wheat production. Wheat production increased as government announced Kissan Package-22 to mitigate the impact of Flood-2022 losses. The Government of Pakistan also increased Minimum Support Price (MSP) to Rs3900/40 kg compared to Rs2200/40 kg ensuring better economic returns to mitigate higher input cost.