SHAMSUL GHANI (shams_ghani@hotmail.com)
Aug 31 - Sep 06, 2009

Reproduced below are some excerpts from Pakistan Agricultural Economy and Policy, February 2009:

"The agriculture sector consists of crops, livestock, fishing and forestry. The crop sector has gradually declined from 65 per cent of agricultural activity in 1990-91 to 48 per cent in 2006-07. By contrast, the share of livestock in agriculture has increased from 30 per cent to 50 per cent over the same period. About of half of all agricultural income is derived from livestock...

Agriculture is the single largest sector of Pakistan's economy. This sector accounts for 22 per cent of GDP and employs nearly half the labor force.

Approximately 67 per cent of the country's population lives in rural areas and directly or indirectly depends on the agricultural sector for livelihood. Average farm size has declined from 13.1 acres in early 1970's to 7.7 acres in 2000. While per capita income is approaching $1,000, there is a wide disparity between urban and rural incomes.

Unlike India, land reform was limited in Pakistan. As a result, a large number of small farmers hold less than half of arable land, while a small number of large landowners hold the rest. There are a large number of landless sharecroppers and agricultural laborers.

A majority of Pakistani politicians and legislators is from rural backgrounds. These politicians along with strong industry groups including the All Pakistan Textile Mills Association and the Pakistan Sugar Mills Association have great influence on agricultural policy. These pressure groups consider their own particular interests over those of small farmers."

The inference that one can draw from the foregoing paragraphs is that livestock is the backbone of agriculture sector, providing support to the crop and dairy farming economies. The development of this sub-sector of the agriculture is at the mercy of the ruling omnipotent feudal lords who hate to share advantages with the lesser souls - in this case the smallholders or landless sharecroppers.

On the dairy farming side, Pakistan can boast of being the fourth largest producer of milk with an annual production of 35 billion liters of milk for human consumption. The gross production is much higher as around 20 per cent of the production is consumed either by the calves or wasted otherwise. It also boasts of having approximately 66 million of dairy animals with some pride breeds of buffalo and cow comparable to the world's best species.

Unfortunately, we are still a net importer of milk and other dairy products. Low productivity because of substandard feeding and / or malnutrition of animals coupled with the low profitability for the immediate producer are the root causes of sector's underperformance. The common person or the ultimate consumer has to pay more than double of what the farmer gets.

Intermediaries that take advantage of weak or no linkages between the producer and the final consumer gobble a major chunk of price benefits. The milk is sold in raw form, with only three per cent going to the processing industry, which in turn sells the processed milk in cities at exorbitantly high prices.


  2005-06 2006-07 Quantity in 000 tons 2007-08
Total 39,596 31,970 40,872 32,996 42,199 34,064
Cow 13,407 10,726 13,913 11,130 14,437 11,550
Buffalo 24,723 19,779 25,465 20,372 26,239 20,991
Sheep 34 34 35 35 35 35
Goat 664 664 682 682 700 700
Camel 767 767 77 77 787 787

There are more than 8 million dairy farming households in the country, which are engaged in the milk business in an informal economy. The animal holding size, likewise the land holding size, is also very dismal - 2 to 5 animals per household. Various studies by national and international organizations suggest that there is a huge untapped potential in Pakistan's dairy farming sector that needs revamping on modern lines to properly connect to the formal economy on one hand and afford the modern livestock farm techniques on the other.

High profile public and private investment, small-farmer-friendly government policies coupled with the market and infrastructure support can enhance productivity and efficiency of this sector manifold.

A White Paper by Pakistan Dairy Development Company summarizes its finding in the following words:

"Dairy farming practices are very old and traditional and need overhauling. To formalize and improve the industry, a private sector led Pakistan Dairy Development Company has emerged with guarantee back up by the government of Pakistan. The platform proposes to improve the dairy sector through improved research facilities, training and capacity building of farmers, training veterinarians, improving the cold chain through milk chillers, promoting healthy pasteurized milk, developing model commercial dairy farms, focus on breed improvement, facilitation of credit financing to dairy farmers and linking the rural area based farmer to the market mechanism. This will improve and formalize the dairy sector. The White Revolution is targeted to achieve an annual production of 40 billion liters of milk by 2015. It aims to create an additional 3 million jobs in the formal economy and provide an estimated 350 million rupees per day in cash flow to farmers in the sector.

The potential is there but there is a need of technical support from the industry, strategic support from dairy experts, policy, and infrastructure from the government, and specific projects funding from the international donor agencies.