LAHORE – Calendar year 2010 was simultaneously the best and worst of years for agriculture. Experts believe that it was a positive year owing to surging commodity prices, while some are of the opinion it was the worst year as devastating summer floods washed away millions of rupees worth of agriculture produce.
However, the consensus is that any increase in commodity prices will not benefit farmers but only fuel further inflation in urban economy. Former Finance Minister Dr Salman Shah dubs 2010 a very poor year in terms of economic and agriculture growth. Speaking to Pakistan Today, Dr Shah claimed that investment to GDP ratio, which was 24 percent in 2007, tumbled to 14 percent in 2010. He claimed that economic growth was an alarming zero percent. Inflation was touching 15 percent, interest rates were highest in the world. “There was no ray of hope in 2010. It was the year of economic failure,” he stressed.
However, he noted that commodity prices were staggeringly high in 2010, but it had not benefited the agriculture sector as cost of production inputs had also ballooned in tandem. Responding to a query, he said commodity prices were rising on a global scale; Pakistan was no exception. Inflated food prices might benefit a limited segment of rural economy, but in fact triggered mass inflation in urban centres.
Agri-Forum Pakistan (AFP) Chairman Muhammad Ibrahim Mughal also insisted that 2010 was nothing to write home about in the context of agriculture and the economy at large. He underlined that Pakistan had virtually missed all targets of growth in varied target categories. He pointed out that the government had fixed the agriculture growth target of 4.5 percent for 2010, but growth figures had instead been mired in the negative. The agriculture sector had suffered an accumulative loss of some Rs 160 billion during 2010, owing to bad policies, he estimated.
He highlighted that all agriculture sub sectors and crops had shown negative growth during the year. The country faces a shortage of two million cotton bales, 1.5 million tonnes of wheat, one million tonne of rice and 0.35 million tonne of gram. He pointed out that it had been hoped that there would be a growth of three to four percent in livestock, but the sector remained negative.
The cost of agriculture inputs and fertiliser increased by between 50 to 100 percent during 2010; it has proven to be extremely detrimental to cultivators, he opined. Mughal went on to say that, “if the government does not pay due attention to the agriculture sector, industry will also face a major setback in the form of scarcity of raw materials”. Speaking to Pakistan Today, Basmati Growers Association President Hamid Malhi asserted that he never saw such a bad year for agriculture. He elaborated on the plight of farmers who had to face a poor macroeconomic situation, natural calamities and the consequences of the government’s poor planning. He listed scarcity of water, load-shedding and high input cost as other major challenges which hampered agricultural growth in the country.
It was stressed that there were several areas for concern in the agriculture supply chain; but sale and marketing of agriculture produce was singled out as the worst segment in the whole supply chain.
Farmers had to look to the government, industrialists and traders, who determined the price of their product. Referring to the wheat procurement drives of the Punjab and Sindh governments, he pointed out that state machinery did not procure the announced quantity of wheat during 2010, which left farmers at the behest of traders and industrials.
He pointed out that the prices of agriculture commodities had increased over 30 percent during 2010, but farmer had yet to benefit from the appreciation. A large portion of agriculture produce has been wiped away owing in the summer floods. It was a common saying that Pakistan was an agriculture country, but with an agriculture policy which was directionless, he concluded.
