For 5,000 years, the economic well being of the people of what is now Pakistan has been secured through agriculture. Even as Pakistan has rapidly modernized over the last 6 decades since independence, a very large component of the economy is still agriculture based. And in these days of population pressure globally, shortfalls of cultivable land, food security issues and rising food prices, this can be a tremendous asset for the country. Our strength in agriculture and farming is borne out by the numbers. We are the world’s 4th largest producer of milk, we export more than $24B worth of textiles annually based on the strength of our cotton production, we have one of the largest populations of farm animals – over 50M – in the country, and our wheat production stands at number 6 in the world. There are many other areas where Pakistan has unassailable competitive advantages, for example, in the fact that the variety of citrus produced in Pakistan is far more diverse than in any other country of the world, or that the mangoes grown in Pakistan are – without doubt – the richest and best on the globe.
Yet, so much more can be done. I have always been of the strong belief that Pakistan actually has no economic problems beyond mismanagement and poor planning. There are no inherent, structural reasons why Pakistan cannot rapidly develop to the levels of a first-world economy, and take its population of 180M along with it. There are very simple and – in the grand scheme of things – tiny steps that we can take to completely alter our economic picture. Let’s take a part of our agricultural sector; wheat production, as an example. We produce 24M tonnes of wheat per year, which is quite a bit. Yet, our per acre yield, at between 23-25 Maunds per acre, is the lowest in the world amongst major agri economies. If we increased yield to Australian or European levels (as high as 70 Maunds per acre), we would have an excess of between 30-40M tonnes of exportable wheat per year, from the existing land under cultivation. This would mean a minimum of an extra $10B of exports annually, given current international wheat prices. The reality is that these prices have been increasing over the past few years and with the world population expected to hit close to 10B in 2050, they won’t be going in the other direction any time soon. [Read the rest of this entry...]