Research Analyst
Feb 13 - 19, 2012

After the independence of Pakistan, it was realized that the institutional sources of credit such as taccavi and cooperatives were unable to meet the financial needs of farmers. Consequently, Agricultural Development Finance Corporation was created in 1952 under a Central Act for the purpose of expanding financial facilities and promoting the development and modernization of agriculture in Pakistan.

In 1957, the Agricultural Bank of Pakistan was established and advanced both short- and long-term loans. Both these institutions were merged together as Agricultural Development Bank of Pakistan in February 1961.

During December 2002, the federal government has turned the Agricultural Development Bank of Pakistan (ADBP) into Zarai Taraqiati Bank Ltd. (ZTBL) and the new venture started its operation with immediate effect.

ZTBL is the largest public sector financial development institution with a wide network of 31 zonal offices, nine audit zones and 357 branches nationwide. The bank serves around half a million clients annually and has over one million accumulated account holders.

The new corporate structure redefines the banks statue as a public limited company with an independent board of directors promulgated under the presidential ordinance, which aims at ensuring good governance, autonomy, delivering high quality, viable and timely financial services to a greater number of clientele in the agricultural and rural segment of the country with adequate returns to the stakeholders.

The bank was registered under the Companies Ordinance 1984 and by virtue of Finance Order all assets, liabilities, and undertaking of ADBP stood transferred to and vested in Zari Taraqiati Bank with effect from December 2002.


Availability of credit for the farming sector plays a pivotal role in the development of agriculture sector. This fact has remained a central force in devising of agriculture finance policies by government and State Bank of Pakistan.

Every effort is made to provide the direly needed credit to the farming community through a well-established infrastructure of banks.

Currently, 20 banks with around 3,700 agriculture designated branches are facilitating farmers by extending agriculture credit throughout the country. These include five scheduled banks, (ABL, HBL, MCB, NBP, and UBL), two specialized banks (ZTBL and PPCBL), and 13 private domestic banks. These banks provide credit to the farming community for all types of farming activities viz. growing crops, livestock, poultry, fisheries, orchards, forestry, nurseries, apiculture, sericulture, etc. Keeping in view the increasing demand of credit due to recent unprecedented floods and torrential rains in the country, the Agricultural Credit Advisor Committee (ACAC) allocated agriculture credit disbursement target of Rs270 billion for 2010-11 as compared to Rs260 billion fixed for the preceding year.

Out of the total target, Rs181.3 billion were allocated to commercial banks, Rs81.8 billion to ZTBL and Rs6.9 billion to Punjab Provincial Cooperative Bank Limited (PPCBL).

During July-March 2010-11, all the banks disbursed Rs168.7 billion or 62.5 per cent of the target compared with disbursement of Rs166.3 billion in the comparable period.

In July-March 2010-11, the specialized bank for agriculture credit ZTBL disbursed Rs37.4 billion as compared to Rs49 billion during the same period of last year. This decline in disbursement was mainly due to the devastating floods, which badly affected the cultivable land. The bank served 295,941 borrowers as compared to 362,050 borrowers.


Agriculture sector recorded modest growth of 1.2 per cent in 2010-11, but provided much needed support to boost exports and revival of manufacturing sector. The agriculture growth slowed down to 2.7 per cent in the decade of 2000s as against 4.4 per cent in 1990s and 5.4 percent in the 1980s. The structural problems and lack of mechanization remained main impediments to growth. Major crops remained the victim of natural calamities during the last few years and three out of last four years witnessed negative growth in the major crop sector.

The unprecedented floods in July 2010 destroyed two major crops, i.e. rice and cotton. As reported by Suparco, an area of 2.364 million hectares under Kharif crops 2010 was damaged.

During the year 2010-11, the overall performance of agriculture sector exhibited a weaker growth mainly due to negative growth of major crops and forestry. Against the growth target of 3.8 per cent, and previous year's performance of 0.6 per cent, agriculture is estimated to grow by 1.2 per cent. Major crops, accounting for 31.1 per cent of agricultural value added, registered a negative growth of four per cent for second year in a row mainly because of decrease in production of rice and cotton by 29.9 and 11.3 per cent respectively. Minor crops accounting for 10.9 per cent of overall agriculture value addition, grew 4.8 per cent as against negative growth of last two years.


2005-06 47.6 68.0 5.9 16.0 137.5 26.4
2006-07 56. 5 80.4 8.0 24.0 168.8 22.8
2007-08 66.9 94.7 5.9 43.9 211.6 25.3
2008-09 75.1 110.7 5.6 41.6 233.1 10.1
2009-10 79.0 119.6 5.7 43.8 248.1 6.5
2009-10 P 49.0 85.2 3.5 28.6 166.3 -
2010-11 P 37.4 93.3 4.4 33.6 168.7 1.4
P: (July - Mar)