Challenges and Growth Potential in Pakistan’s Agricultural Economy
Pakistan's economy is largely agricultural, benefiting from rich natural resources. Although traditional farming practices dominate, the adoption of modern technology is gradually increasing. The sector is a vital source of employment, particularly for rural and unskilled workers, and supports parts of the industrial sector dependent on agricultural produce.
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Uzma Zia
8/13/20246 min read
Following the introduction of agricultural policies in 2018, Pakistan's agriculture sector saw a growth rate of 2.67%, which further increased to 2.98% in FY2020. This growth has been particularly evident in essential crops like wheat, rice, sugarcane, and maize. The sector has managed to sustain moderate growth despite challenges such as the locust invasion and the global pandemic, which severely impacted other sectors. Currently, agriculture contributes 22.9% to Pakistan’s GDP and accounts for 37.4% of employment, thereby ensuring food security and providing raw materials to the industrial sector. The overall crop production pattern is presented in table 1.


The Pakistani government has shown a strong commitment to the Sustainable Development Goals (SDGs) by launching programs aimed at reducing poverty and hunger. Provincial governments have developed Comprehensive Development Strategies (CDS) that aim to boost economic and sectoral growth. These strategies emphasize supporting productive sectors, promoting sustainable resource use, increasing output, income, and employment, and fostering close connections with farming communities. A key element of this strategy is the support provided at the provincial level.
Food standards in Pakistan were first set under the Pure Food Laws (PFL) of 1963. This legislation, which has been revised twice, serves as the basis for current food quality and safety regulations, covering 104 food items across nine categories.
The National Climate Change Policy (2012) and its updated version in 2021 were created to integrate climate change considerations into the most vulnerable sectors of the economy and society. These policies target critical areas such as water resources, agriculture, livestock, forestry, health, emergency preparedness, transport, and energy.
Since 2019, Pakistan's agriculture sector has faced several challenges, which are discussed below.
1. Impact of COVID-19 on Agriculture and Food Policy Regulation
The outbreak of COVID-19 in 2019, and the resulting lockdowns, led to numerous economic challenges, affecting the agriculture sector and threatening food security. According to the Pakistan Economic Survey 2019-20, the agriculture sector was not severely impacted initially, with a growth rate of 2.67% in 2019-20 compared to 0.58% in 2018-19. The continued crop growth during this period helped mitigate the threat of food insecurity. During the pandemic, the government prioritized keeping agricultural activities running as essential services to ensure markets remained well-stocked with food, enabling consumers to access necessary supplies.
1.1 Government’s Policy Responses During COVID-19
The Prime Minister announced a relief package of Rs1.13 trillion ($7 billion) during the COVID-19 pandemic. Of this, Rs280 billion ($1.76 billion) was allocated for wheat procurement, and Rs100 billion ($63 million) was designated for deferred loan payments for small and medium enterprises, including those in the agriculture sector. The government also adjusted subsidies, reducing the amount provided to PASSCO from Rs15.5 billion to Rs7 billion and allocating funds for wheat operations, reserves, and subsidies for regions like Gilgit-Baltistan.
The pandemic led to a reduction in global economic growth rates, prompting the Pakistani government to revise its own growth targets.
2. Locust Outbreak and Food Insecurity in Pakistan
Pakistan's agriculture was severely impacted by a locust outbreak, particularly in Balochistan and Sindh provinces. The prolonged presence of locust swarms since March 2018 was alarming, leading to a national emergency declaration on February 1st, 2020. Previous locust invasions in the 1950s, 1960s, and 1990s caused significant agricultural losses, and the 2018 outbreak brought Pakistan to the brink of a food security crisis. The Food and Agriculture Organization (FAO) warned of a potential second wave of locust invasion.
The locust outbreak resulted in significant agricultural losses across major crop-producing areas in Balochistan, Punjab, and Sindh. Over 115,000 hectares of crops, including wheat, oilseeds, cotton, gram, fruits, and vegetables, were damaged. The locust invasion had a more devastating impact on agriculture than COVID-19. Several factors contributed to the severity of the outbreak:
Climatic Factors: The persistence of the locust outbreak was due to favorable conditions, such as moisture, vegetation, and a suitable environment in sandy areas. Climate change also played a role, providing the insects with ideal conditions to thrive and reproduce.
Loss and Damage: The general secretary of the Sindh Chamber of Agriculture reported that the locust attack destroyed 40% of crops like wheat, cotton, maize, and tomatoes. Local communities expressed concerns about the destruction of their standing crops and the anticipated loss of income. The locusts invaded 57 million hectares, including 23 million hectares of Pakistan's total crop area, severely damaging wheat, oilseeds, pulses, fodder, and vegetables in Sindh.
Food Insecurity and Livestock Grazing: Although some agricultural activities and fodder for livestock grazing were revived, the damage caused by the locusts led to extreme food insecurity among local communities and their livestock.
2.1 Government’s Response to the Locust Outbreak
In response to the locust infestation, the government conducted aerial spraying over 20,000 hectares of land. The Minister for National Food Security highlighted that district administrations, voluntary organizations, the aviation division, and the armed forces were mobilized to combat the locusts and protect crops. The government used four aircraft and several army helicopters for crop dusting and planned to purchase additional planes for this purpose. To prevent future locust attacks, integrated crop and pest management training programs were developed to educate farmers on pest management and crop selection.
Under the National Action Plan, the federal government provided over Rs1.0 billion in the first phase (January to June 2020) and established the National Locust Control Centre (NLCC) on June 1st, 2020, to coordinate surveillance, control, and monitoring efforts. A revised National Action Plan worth Rs25 billion was formulated, with the federal government contributing Rs13.6 billion and the provincial governments providing Rs11.4 billion.
3. Climate Change Concerns
The agriculture sector is particularly vulnerable to climate change. Extreme weather conditions have reduced crop yields and increased variability in agricultural productivity due to factors such as floods, droughts, and other natural disasters. Pakistan's agricultural land, which supports a wide range of crops, is at risk from these climate change-related events, potentially leading to chronic food insecurity.
Pakistan faces numerous challenges due to climate change, including environmental degradation, water shortages, floods, declining crop production capacity, droughts, reduced forest productivity, temperature rises that impact rice and wheat yields, decreased arable land, pollution, changes in cropping patterns, and health issues.
3.1 Key Initiatives Addressing Climate Change
Pakistan ranks among the countries most vulnerable to climate change. The Global Climate Risk Index report of 2018 placed the country among the ten most-affected by climate change.
Paris Climate Accord: Pakistan is a signatory to the Paris Climate Accord, which aims to combat global climate change. Under this agreement, Pakistan has committed to reducing its projected carbon emissions by 20% by 2030. Notably, a significant portion of Pakistan's pledged emission reductions will come from Punjab's agriculture sector.
Pak-INDC Agreement: This agreement addresses the major climatic challenges facing Pakistan, including climate-induced variability and natural disasters. Pakistan is actively working on reducing greenhouse gas emissions, developing adaptation strategies, and managing disasters.
Ten Billion Tree Tsunami Programme: The government of Pakistan has launched the "Ten Billion Tree Tsunami Programme, Phase-I," implemented across the country by the Ministry of Climate Change in collaboration with provincial and territorial forest and wildlife departments.
4. Food Safety Regulations
Food safety regulations in Pakistan encompass food control, food safety, and aspects of food trade. Although the country does not have a fully integrated legal framework for food safety, several laws address these issues. Food standards in Pakistan were first established under the Pure Food Laws (PFL) of 1963, which have been revised twice, in 2007 and 2011. These regulations cover additives, food preservatives, synthetic colors, antioxidants, and heavy metals.
Four key laws address food safety:
The Pure Food Ordinance 1960: Aimed at ensuring the supply of pure food and preventing adulteration.
The Cantonment Pure Food Act 1966
The Pakistan Hotels and Restaurants Act 1976: Regulates rates and service standards in hotels and restaurants.
Pakistan Standards and Quality Control Authority Act: Indirectly relevant to food security.
5. Conclusion
Pakistan's agrarian economy is vulnerable to various threats related to agriculture, climate, and food security. Over the past six years, the country has faced challenges such as COVID-19, the locust outbreak, food insecurity, and climate change. It is crucial for Pakistan to carefully select its policy options in the food and agriculture sectors to enhance agricultural performance. Increased government support for developing value chains, productivity, and marketing processes is likely to benefit the sector. Additionally, it is essential to ensure the active participation of women and other vulnerable groups in the sector. There is a critical need to create synergy between agricultural policies, food security policies, climate change policies, and food laws. Moreover, proactive and comprehensive measures should be in place before and during crises, supported by a well-planned research agenda focused on agricultural technology adoption and capacity building for relevant personnel.
Please note that the views expressed in this article are of the author and do not necessarily reflect the views or policies of any organization.
Uzma Zia, PhD is Senior Research Economist, Pakistan Institute of Development Economics, Islamabad, Pakistan.
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