State of agriculture in an agricultural state

Dr Qaisar AbbasPolitical EconomyAugust 8, 2021

  • Dr Maqbool Hussain Sial, a professor of economics, explores why an agricultural state like Pakistan, which used to export food grains, now imports them to feed its population

For Dr Maqbool Hussain Sial, Pakistan has become a perfect example of preventing agricultural growth, making a mockery of rural development projects, and keeping agricultural produce out of the reach of the lower classes.

With his rich experience in public and private sectors in the United States and Pakistan, Dr Sial currently serves as a professor of economics at the University of Management and Technology, Lahore. Prior to his current position, he worked as dean and professor at the University of Sargodha.

After completing his doctorate in applied economics from the University of Wisconsin-Madison, he served as a research scientist with the Food System Research Group at the University of Wisconsin-Madison. He also worked as a trade analyst at the Trade and Consumer Protection Division for the State of Wisconsin. Subsequently, he worked in the corporate sector as a senior credit analyst and director of modeling and analysis with banking and insurance companies in the USA. His doctoral research was on the Impact of Rural Credit on Small Farms’ Productivity in Punjab-Pakistan. It analyzed the effects of credit and other factors on the income and profitability of small farmers. He also has a master’s degree in agriculture and applied economics from the same university.

He is currently the editor-in-chief of the Journal of Quantitative Methods and has published more than 65 articles in international and national journals. His research interests include economic growth, poverty, inequality, rural development, market concentration, industrial organisation and ‘other’ perspectives in economics.

In the following interview, he discusses the current state of the agricultural state of Pakistan, the changing dynamics of the feudal system, prices of agricultural produce, factors behind the failure of the Green Revolution. He also looks for an appropriate model to improve the agricultural economy in Pakistan.

The News on Sunday (TNS): As an agricultural state, Pakistan was self-sufficient in agrarian production until the ’70s and the ‘80s. However, now we import several essential grains from other countries. What are the reasons?

Dr Sial: This is an excellent question and very timely. There are several reasons for the decline in the production of wheat, rice, cotton, and sugarcane.

First, the Muslim League-Nawaz was least interested in the agricultural sector when it was in power. Instead, their priorities were to launch motorway projects and develop infrastructures in major cities, particularly in the Punjab, at the cost of the agricultural sector.

Second, our agricultural research system is relatively weak. It did not contribute much toward developing high-yielding seed varieties and other output-enhancing technologies compared to India, where crop yields are much higher than in Pakistan.

Moreover, the linkages among agricultural universities, agricultural research centres, and agricultural extension are non-existent. Resultantly development and transfer of new technology to farmers is very challenging.

Third, as you know, Pakistan’s population growth rate is exceptionally high, whereas food and agriculture growth are stagnant, creating an imbalance between food requirements and food production. Such a gap in food demand and supply poses a severe challenge and manifests in a Malthusian population trap. The theory stipulates that population growth follows an exponential path while food supplies and other resources increase geometrically.

Pakistan is also among the countries with a relatively high percentage of young people, generally referred to as youth bulge. We need to plan and manage this precious human resource through demand-driven skill-based education, training and access to better health facilities.

TNS: How would you explain the price hikes for rice, sugar, wheat and vegetables in Pakistan?

Dr Sial: Low agrarian productivity, the feudal-business mafia, and market dynamics have led to price hikes in Pakistan’s agricultural produce and grains. A combination of these factors is making the situation worse.

The sugar mafia manipulates the market to raise the price. Sugar mill owners and market manipulators work together to increase their profits; the ultimate losers are the poor and the middle-class citizens.

In the current circumstances, demand for food is more than its production. As a result, Pakistan has become a net importer of food grains.

TNS: Despite tall claims of success, why did the so-called Green Revolution fail to sustain agricultural growth in Pakistan?

Dr Sial: True, the Green Revolution became a major initiative to boost agricultural growth in the mid-sixties. The primary tool behind this initiative was the introduction of high-yielding varieties of wheat and rice seeds.

More effective use of chemical fertilisers and modern pesticides also revolutionised the production of crops during that period. As a result, farmers saw more benefits and immediate results in using these scientifically proven methods to boost farm production.

Farm mechanisation also helped improve agricultural productivity during the Green Revolution days. Agricultural yields rose to almost 250 per cent per acre under the Green Revolution.

However, this agricultural growth could not be sustained for several reasons. First, improvement in seed and modern technology stopped. The agricultural sector’s lack of research facilities and expertise resulted in a status quo or decline in agrarian growth.

Moreover, some of the green revolution technologies were capital intensive, and it was not economically viable for fragmented and small farms. Most of the farmers in Pakistan are small – 89 percent of all farms are less than 5 hectares. They have financial constraints such as savings and access to credit, limiting their access to new farming technologies. Eventually, these factors restrain them from achieving their full potential.

Small farms in Pakistan generally pursue subsistence farming with a peasant mode of production. They produce for their consumption with no or a meager amount of marketable surplus.

Over time, the high population growth vis à vis a stagnant agrarian growth has turned Pakistan into a net importer of grains, causing food shortages and high prices of essential food items in Pakistan.

TNS: It is said that the feudal system in Pakistan is not as strong as it used to be. Is that true?

Dr Sial: You are right. The centuries-old feudal system in Pakistan is in the process of transformation for several reasons. First, landlords and big farmers have to divide the land among family members under the law of inheritance. This land fragmentation is becoming a monumental challenge for farming. However, the feudal system is still prevalent in southern Punjab and interior Sindh.

Second, several landlords have sold their lands and moved to business and industry sectors. In most cases, they are now absentee landlords because they are not physically located in rural areas as they used to be.

This transformation in the feudal structure has become a predominant trend in Pakistan.

People also move from rural to urban centres to educate their children, as the rural areas have only a few higher education institutions. They are also looking for alternative sources of income that are not available in the rural areas.

This migration is also causing adverse effects on major cities in terms of housing shortage, unemployment and high crime rates. Moreover, to fulfill the housing needs in cities, thousands of acres of fertile land are being converted from farming into mega housing projects like Bahria Towns and DHAs.

In addition to this ongoing land fragmentation and the changing structure of the feudal system, the cost of agricultural production is becoming high. Consequently, as profits decline in agriculture, people are inclined to find other profitable business ventures.

TNS: Several rural development projects were introduced during the last 73 years in Pakistan. There are some success stories, but why did most of these projects fail so terribly?

Dr Sial: This is another sad story. As you know, stakeholders’ involvement, including local farmers, communities and people play a vital role in any rural development project.

These projects were introduced basically under a top-down approach, not a bottom-up one. Here, landlords, provincial and federal government administrators, and businesses became these projects’ main stakeholders and beneficiaries. Wherever local people and governments were involved, the local bodies and the governance structure could not handle these projects.

The government introduced several Integrated Rural Development Programmes in the 1960s. These were primarily successful in East Pakistan. Imaginative and robust leaders such as Dr Akhtar Hamid Khan were behind the success of the rural development initiatives in East Pakistan.

Another factor was the social structure in both wings of the country. Bengalis work together with a cooperative approach in such projects. The Bangladeshi Nobel laureate Dr Muhammad Yunus’s small loans projects were mainly successful because they were based on group lending mechanisms. On the other hand, in Pakistan, people lack a cooperative approach and prefer to work as individuals.

Our administrators and bureaucracy also mishandled rural development projects. These institutions are not created to support new projects. Their objective was to maintain the status quo in the society. We need to redesign the governance structure to fix fault lines obstructing technocrats from designing strategies and action plans for sectorial developments.

TNS: If you become an agriculture minister in Pakistan, what would be your strategy to boost the agricultural economy?

Dr Sial: I think there are some excellent models in the world to follow, such as the Chinese model. We can learn from their experience. From the era of a lacklustre agricultural economy, China has progressed to exporting agricultural produce worldwide.

While China allotted land to farmers and utilised human resources effectively, a lot of Pakistan’s agricultural labour is unutilised. We can use our agrarian workers with planning. We can work with China in developing agricultural technologies and learn how they boosted their agricultural growth.

Second, the government should devise policies to ensure the allocation of farmland to various crops based on their natural suitability according to the agro-ecology of different zones in Pakistan. This will ensure better land and farming infrastructures based on what is best suited for a specific farming area. We should create cotton, rice, wheat, and other zones and focus our planning around these zones.

Pakistan used to be a net exporter of cotton, but now we are importing it. It used to be a significant foreign exchange earner. However, growing sugarcane became more critical than cotton, and as a result, sugarcane is now grown in areas not well suited for its growth.

Third, agriculture is subsidised by almost every state in the world, including the US. We do not support the agricultural sector in Pakistan as much. In my view, agricultural plans and policies should focus on aiding farmers through subsidies.

Besides these measures, better planning, forecasting, removing the management loopholes and rooting out corruption are essential recipes for boosting agricultural production in Pakistan.

The author is co-editor of a recently published book, From Terrorism to Television: Dynamics of Media, State and Society in Pakistan (Routledge, 2020). He is an academic scholar and freelance writer based in the   United States.

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