SIGNIFICANCE OF PUBLIC POLICIES IN AGRICULTURE SECTOR

 

Investors should not follow the psyche of day traders


By ASHIQUE ALI JOYO, HEC,
Islamabad
Dec 22 - 28, 2003

Agriculture sector is life blood of Pakistan's economy. This sector has dire need of potential stability, enlightened and consistent policies. This research article entitled "Significance of Public Policies in Agriculture Sector" is written with the purpose to analyze the various Public Policies for increasing the output of agriculture sector in Pakistan. The research article is collected on the secondary data.

Pakistan inherited an agrarian economy at the time of partition in 1947. The development of agriculture was ignored from 1947-48 to 1958 in spite of the fact that the agricultural sector was the largest contributor to the GDP. It employed 80% of the population directly or indirectly, accounted 73% of the foreign exchanges, provided raw material to the industrial sector and served as a market for industrial products.

From 1947 to 1953, agriculture remained sluggish due to (i) influx of migrant from India (ii) allotment of land to non-agriculturists, which reduced output (iii) lack of technological change etc. During 1953 to 1958 more attention was given to the industrial sector. The agriculture sector remained neglected till 1958. The production could not increase with the increasing rate of population. The average growth of this sector was 1.3 percent while the growth rate of food grains stood 1.69 percent as compared to population growth rate 2.6% during the period of 1947-48 to 1958-59. Pakistan imported over one million tones of wheat after 1952 to meet the acute food shortage. Thus within 12 years Pakistan become a net importer of agricultural commodities which created a great burden upon the balance of payments. Table 1, 2 and 3 highlight the position of agriculture sector.

Table 1
LAND UTILIZATION IN AGRICULTURE SECTOR
1947-48 & l958-59

YEAR

TOTAL CULTIVATED LAND MILLION HECTARES

% CHANGE

1947-48

11.63

-

1958-59

14.33

123.21

Average increase

-

1.93

Source: Government of Pakistan Economic Survey 1989-90, Islamabad 1990. Statistical Section P. 44-46.

 


 

Table 2
LAND CULTIVATION AND OUTPUT OF FOOD GRAINS FROM 1947-48-1958-59

YEAR

AREA UNDER CULTIVATION OF GRAINS

TOTAL OUTPUT OF FOOD GRAINS

 

(000) hectares

%Change

(000) Tons

% Change

1947-48

6510

-

5025

-

1958-59

7888

+21.17

6046

+20.32

Average

 

1.76

 

1.69

Source: Government of Pakistan Economic Survey 1989-90, Islamabad 1990. Statistical Section P. 44-46.

 


 

Table-3
TOTAL CULTIVATED LAND AND OUTPUT OF MAIN CASH CROPS FROM 1947-48-1958-59

YEAR

CULTIVATED AREA UNDER SUGARCANE CROP

TOTAL PRODUCTION SUGARCANE

CULTIVATED AREA UNDER COTTON CROP

TOTAL COTTON PRODUCTION

 

"000"
Hectares

%
Change

"000"
Tons

%
Change

"000"
Tons

%
Change

"000"
Tons

%
Change

1947-48

189

-

5529

-

1237

-

197

-

1958-59

428

+126.45

12489

+

1325

07.11

283

+43.65

Average

 

10.54

 

13

 

0.59

 

3.64

Source: Economic Survey 1989-90, Government of Pakistan.Statistical Section P-44-46.

PUBLIC POLICIES FOR AGRICULTURAL DEVELOPMENT

Earlier it is stated that Pakistan inherited an agrarian economy at the time of independence. The agriculture sector remained sluggish upto 1958. Therefore government realized the importance of agriculture sector in this connection government framed various policies for the development of this sector.

LAND REFORMS

a. Late Field Marshal Muhammad Ayub Khan introduced land reforms policy in 1959.
b. Late Zulfiquar Ali Bhutto introduced land reforms policies in 1972 and 1977.

CONCEPT OF LAND REFORMS

Land reform applies to all measures aimed at eliminating the undesirable features of land tenure system and making land a more efficient instrument of economic development, demolishing of big Jagirs and landlorisms and to adopt such policies that should be helpful for a betterment and advance agriculture society so that there should be better atmosphere between tenants and landlords. It also includes supply of agricultural equipments, improved seed, fertilizer, credit and irrigation facilities to farmers.

OBJECTIVES OF LAND REFORMS

1. To increase agricultural production
2. To raise level of income and living standard of farmers
3. To remove social in-equilibrium resulting from very small and very large land holdings.

Progress of Implementation of land reforms up to June 1994 (hectares), are shown in table 4.1 and 4.2

Table 4.1
LAND REFORMS 1959

PROVINCE

AREA RESUMED

AREA DISPOSED OF

BALANCE

PERSON BENEFITED

Punjab

511244

505082

6162

109889

Sindh

346307

300091

48218

46131

NWFP

112108

97287

14821

46131

Balochistan

53268

53196

72

6221

Total

1022927

955656

69273

208372

Source: Government of Pakistan, Agricultural Statistics l993-94, Islamabad 1995 P-129.

 


 

Table 4.2
LAND REFORMS 1972

PROVINCE

AREA RESUMED

AREA DISPOSED OF

BALANCE

PERSON BENEFITED

Punjab

121593

94283

27010

36017

Sindh

112920

72477

40442

17167

NWFP

57415

55122

2293

12811

Balochistan

189316

73755

115562

5506

Total

481244

295937

185307

71501

Source: Government of Pakistan, Agricultural Statistics 1993-94, Islamabad 1995 P-129.

 


 

Table 5
LAND REFORMS 1977

PROVINCE

AREA RESUMED

AREA DISPOSED OF

BALANCE

PERSON BENEFITED

Punjab

93806

23426

70380

1543

Sindh

31741

19966

11775

1496

NWFP

23787

4162

19625

781

Balochistan

17502

269

17233

14

Total

166836

47823

119013

3834

Source: Government of Pakistan, Agricultural Statistics 1980, Islamabad 1981 P-99.

Over all progress, 565, 368 hectares of land were resumed under the various land reforms in Pakistan. Out of which 1,326,495.5 hectares were distributed among 250,470 persons which brought improvement in agricultural sector.

GREEN REVOLUTION

It means the introduction of new technology in the agricultural sector. This technology was introduced in mid-1960s with scientific and technological break through in the form of inputs like high yielding varieties of seed (HYV), fertilizers, pesticides, water, mechanization in terms of tubewells and tractors. The information of input is shown in tables 6,7,8 and 9.

Table 6
NUMBER OF TRACTORS AND CONSUMPTION OF FERTILIZER
1966-67 & 1999-2000

YEAR

NUMBER OF TRACTOR

CONSUMPTION OF FERTILIZER (000 N/TONS)

1966-67

4113

111.83

1999-2000

32,554

2833.53

Source: Economic Survey 1997-98 and 2001-2002, Government of Pakistan. Statistical Section PP 22 and 47.

 


 

Table 7
NUMBER OF TUBEWELLS, DISTRIBUTION OF IMPROVED SEED AND CONSUMPTION OF PESTICIDES IN AGRICULTURE SECTOR.

YEAR

NUMBER OF TUBEWELLS

YEAR

DISTRIBUTION OF IMPROVED SEED IN (000 TONS)

YEAR

CONSUMPTION OF PESTICIDES IN TONS

1980-81

1,88,912

1997-72

22.54

1981

3677

1999-00

5,31,344

1999-00

165.80

2000

47915

Source: Economic Surveys 1997-98 and 2001-2002, Government of Pakistan.Statistical Section PP 22, 48, 151 and 153.

 


 

Table 8
CREDIT DISBURSED BY FINANCIAL INSTITUTIONS TO GROWERS AND AVAILABILITY OF SURFACE AND GROUND WATER

YEAR

CREDIT DISTRIBUTION IN RS. MILLION

YEAR

AVAILABILITY OF SURFACE GROUND WATER MAF

1959-60

87.58

1965-66

63.87

1999 00

40188.63

1999-00

133.29

MAF = Million Acre Feet.
Source: Economic Surveys 1987-88, 1997-98 and 2001-2002, Government of Pakistan.
Statistical Section PP 22, 26, 27, 32 and 153.

 


 

Table -9
PUBLIC SECTOR EXPENDITURE ON AGRICULTURE AND IRRIGATION DEVELOPMENT DURING VARIOUS FIVE YEAR PLANS IN PAKISTAN.

SECTOR

FIRST PLAN 1955-60

SECOND PLAN
1960-65

THIRD PLAN
1965-70

NON PLAN PERIOD 1970-78

FIFTH PLAN PERIOD 1978-83

SIXTH PLAN PERIOD 1983-88

SEVENTH PLAN PERIOD 1988-98

EIGHTH PLAN PERIOD 1993-98

Agriculture

0.460

0.910

1.380

6.490

14.860

17.302

15.600

5.700

Water

0.970

4.600

4.510

12.810

15.770

22.015

28.400

55.600

Source: GOP, Agricultural Statistics of Pakistan 1998-99. PP. 267.

AGRICULTURAL PRICE POLICY

This policy covers output price policy and input price policy. The output price refers to the fixation of procurement and support prices for important food and cash crops such as wheat, rice, cotton, sugarcane, oilseeds etc. It indicates the stabilization of agricultural prices at reasonable level which may be acceptable for the farmers as well as for the consumer but these policies, however, been changing overtime in the light of changing objectives.

COMMERCIALIZED AGRICULTURE POLICY

Commercialization of agriculture means to change the way of living of a agriculture sector and to change the rural thinking to urban thinking. The farmers are encouraged to produce market-orient product. The main purpose of this policy is to increase the income of the farmers.

AGRICULTURAL SERVICES POLICIES

There are several public sector services, which are needed to improve the production and distribution of agricultural inputs and commodities. Among these credit, marketing, education, research and extension are essential for the development of agricultural sector.

By implementing the above discussed policies, the output of food grains increased from 6.10 million tones to 28.39 million tons and the output of cash crops rose from 11.084 million tons to 48.685 million tons during the period 1959-60 and 1999-2000. The country became self-sufficient in food during 2000 and saved the foreign exchange. Its contribution to gross national product (GNP) also increased from Rs.7711 million to Rs.776219 million during the same period. More agricultural productivity can be achieved by the changing new technology, supply of agricultural credit, provision of improved seed, more use of fertilizer, water and land management and modern management skill. Through above mentioned policies, it is observed that the agricultural sector has achieved a remarkable growth rate and had met the requirements of food grain in 2000.