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A griculture by brands academy

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Brand Academy provides details brand analysis, research, article and insights for free. …

Brand Academy provides details brand analysis, research, article and insights for free.

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  • 1. 3
  • 2. AGRICULTURE OVERVIEW •Pakistan is basically an agrarian country and its economy revolves around agriculture sector which contributes around 21 percent to Gross Domestic Produce (GDP) and employs more than 44 per cent of the country’s total labor force and supports directly or indirectly about 68.4 percent of the population for their nutrition. •Agriculture provided main impetus to economic growth by creating additional demand of goods and services as a result of higher prices of agricultural produce •Agriculture is the major source of foreign exchange earnings. About 64% of exports are based on agriculture raw material Agriculture is a source of food for the increasing population of our country. About 16 million tons wheat, 4 million tons rice is produced in country. Agriculture is a source of revenues for the federal and provincial government. Local bodies also get revenues from the agriculture 4
  • 3. • The agriculture has lost significant growth momentum as its growth slowed down to 2.7 percent in the 2000s as against 4.4 percent in 1990s and 5.4 percent in the 1980s. The structural problems and lack of mechanization remained main impediment to growth. Major crops remained 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 • • • 60% of Pakistan’s rural poor are landless. – 45% are non- agricultural households – 15% are landless agricultural laborers Source: FBR 5
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  • 5. percentage 30 25 25.9 21.8 20 21.2 20.9 21.1 15 percentage 10 5 0 1999-00 2008-09 2009-10 2010-11 2011-2012 7
  • 6. • The agriculture growth this year stood at 3.1 percent as compared to 2.4 percent during 2010-11. • Cotton production has increased to 13,595 thousand bales in 2011-12 from 11,460 thousand bales in 2010-11 showing an increase of 18.6 percent. • Wheat production has decreased to 23,517 thousand tons in 2011-12 from 25,214 thousand tons in 2010-11 showing a decrease of 6.7 percent. • Rice production has increased to 6,160 thousand tons in 2011-12 from 4,823 thousand tons in 2010-11 showing an increase of 27.7 percent. • Sugarcane production has increased by 4.9 percent to 58.0 million tons in 2011-12 from 55.3 million tons last year. • With Floods , The highest damage occurred in the agriculture, livestock and fisheries sector, has been estimated at Rs.160 billion (US$ 1.84 billion). 8
  • 7. contd • Agriculture credit disbursement of Rs. 197.4 billion during July-March 2011-12 is higher by 17.0 percent, as compared to Rs. 168.7 billion over the same period last year. • The total availability of urea during Rabi 2011-12 was 3,526 thousand tonnes comprising of domestic production 2,160 thousand tonnes and imported supplies of 1,202 thousand tonnes.The total offtake was 2,710 thousand tonnes, leaving a stock of 800 thousand tonnes for next season. Likewise the total estimated availability of urea during Kharif 2012 will be around 3487 thousand tonnes comprising 800 thousand tonnes of opening stock, 2280 thousand tonnes of domestic production and 407 thousand tonnes of imported supplies.The total offtake is estimated around 3200 thousand tonnes during Kharif 2012 leaving a stock around 287 thousand tonnes • In minor crops, the production of mung and potatoes increased by 22.0 percent and 17.5 percent, respectively. However, the production of chillies, onion and masoor decreased by 78.3 percent, 15.4 percent and 12.8 percent, respectively. 9
  • 8. 10
  • 9. Source: Provisional Agriculture Department 11
  • 10. The agricultural sector in Pakistan is classified as containing 5 sub sectors: MAJOR CROPS MINOR CROPS LIVESTOCK FISHERY FORESTARY 12
  • 11. THE MAJOR CROPS INCLUDE •SUGAR CANE •RICE •MAIZE •WHEAT 13
  • 12. EARNINGS 67.5% of country population dependent on agriculture for their livelihood 44.8 percent of total employment is generated in agriculture. FOOD TO CONSUMERS LIVINGS 70% of our total population is living in the villages. The major source of their living is agriculture. 14
  • 13. SUPPORT TO INDUSTRIES improved growth in the agricultural sector supplies raw material to Pakistan’s industries, notably textile industry, the largest industrial sub-sector or the economy Earn them foreign exchange by exporting 15
  • 14. CONTRIBUTION TO GDP Agriculture Development Essential to Curtail Inflation ECONOMIC GROWTH Foreign Exchange Earner Providing Labour Force to Industry 16
  • 15. WATER TAX (DHAL) MARKETABLE SURPLUS Psychological Conditions 17
  • 16. • The role of credit is instrumental in the agriculture sector where Pakistani farmers often lack finances necessary for carrying out vital farming activities • From Different Studies Conducted from time to time, it is concluded that Farmers mostly take the Credit facilities from Two Sources 1. Formal Sources like Financial Institutions and Commercial Banks 2. Informal Sources like Friends n Family or Landlords • • • • 10% among them take loan from Institutions and rest 90 Percent Take from Informal Sources. From 90% , 11 percent of house holds like to take loans from Land lord and rest take it from FnF The both types of loan is for Same Short Term time period Only reason of not preferring the Loan from institutions is the complex procedure required. Source: Akbar Zaidi (Issues in Pakistan`s Economy) 18
  • 17. well-established network of lending institutions operates to meet the financial requirements of farmers in the rural areas. Currently 26 commercial and microfinance banks, with around 3,900 agriculture designated branches, are facilitating farmers by extending agriculture credit throughout the country. These include; ABL, Habib Bank Limited (HBL), Muslim Commercial Bank (MCB), United Bank Limited (UBL), two specialized banks, viz, Zarai Tarqiti Bank Limited (ZTBL), Punjab Provincial Corporative Bank Limited (PCBL), and 14 private domestic banks. 19
  • 18. 20
  • 19. • Mechanization means the use of new technology (machines) for conducting agricultural operations like sowing, harvesting, thrashing, leveling, watering, spraying, weeding etc, replacing the traditional methods which involve human and animal labor. • 3 technologies under Mechanization  CHEMICAL TECHNOLOGY: Plant Protection measures  HYDROLOGICAL TECHNOLOGY: Tube wells  MECHANICAL TECHNOLOGY: Tractors, Thrashers, Bulldozers etc. • • The use of Mechanical Power in Pakistan`s Agriculture was first appeared in the Early Fifties , when Private Tube wells were established in few quantity for Water Irrigation purpose , In 1959-60 The pace of the Tube well gained Momentum and reached to 25000 by mid 1964. during same time Seed Fertilizer revolution and Introduction of Tractors become Essential for Agriculture in Mid Sixties. 21
  • 20. • there is High growth rate for the Mechanization into Pakistan but Still the process of Mechanization is not completed yet. 1. Except large Size of Tractors, Pakistan does not own other large size Agricultural Equipments like Combine Harvesters, reapers and cotton pickers. 2. Per hector Horsepower in Pakistan is only 0.2 while its 2.0 in other western countries. 3. The access of other technologies except tractors, Tube wells and Threshers is very lower. Even the usage level of these three mainly used technology is only 34%. 38% and 17% respectively of total farms. • Still about 63% of the Agricultural Output is dependent upon Bullocks and traditional Farming Methods • To achieve required hp per hectare farm power availability, the government has launched Benazir Tractor Scheme to deliver 20,000 tractors to the farmers all over the country at subsidized rate of Rs. 200,000/- per beneficiary/ tractor. • During first year of the scheme, 10,000 tractors have been delivered among the farmers. • To promote use of efficient and quality machinery & equipment etc, the government has also allowed import of agricultural machinery, not being manufactured locally at zero tariffs. • Other interventions such as use of laser land levellers, ridge and broad bed farming are being encouraged in the country through provision of farm machinery to the farmers/services providers at subsidized rates. Dr Gaffar Chaudary 22 Head research Pakistan Institute of Development Economics
  • 21. 23
  • 22. 24
  • 23. ISSUES OF AGRICULTURE IN PAKISTAN 25
  • 24. • Low quality inputs • Imperfect commodity markets • Poor quality support services • Poor delivery and sustainability of agricultural finance • no a such proper policy from starting • Inadequate rural infrastructure • Deteriorating natural resources • Water issue • taxation issue 26
  • 25. • THE FLOOD ISSUE (August2010) problems arise like:    Shortage of food Increase in unemployment Around 7 Million people became shelter less  Wastage of land (opportunity for up coming year better production)     for poverty increases Raw materials destroyed live stock died (this also created milk problem) drinking water in interior Sindh became impure 27
  • 26. 28
  • 27. • • • • • Soil salinity Drainage Water logging Traditional and old methods of cultivation Scarcity of water and water management • Inefficiency Of Farmers due to the illiteracy 29
  • 28. • Salinity Soil salinity problem is common in arid and semiarid regions, where rainfall is insufficient to leach salts and excess sodium ions out of the rhizosphere. Nearly 10% of the total land surface is covered with different types of salt-affected soils. At present, there are nearly 954 million hectares of saline soils on the earth's surface. • Drainage The continuous expansion of the irrigation system over the past century significantly altered the hydrological balance of the Indus River basin. Seepage from the system and percolation from irrigated fields caused the water table to rise, reaching crisis conditions for a substantial area. 30
  • 29. • Water logging By 1993 the government had installed around 15,000 tube wells. Private farmers, however, had installed over 200,000 mostly small tube wells, mainly for irrigation purposes but also to lower the water table. Private wells probably pumped more than five times as much water as public wells. • Traditional and old methods of cultivation • Scarcity of water and water management A substantial amount of water is also lost annually due to water management inefficiency. Water losses are estimated to be approximately 25 per cent from the canal head to the outlet and another 15 per cent from the outlet to the farm gate mainly due to poorly linked canals and water courses. 31
  • 30. • Land reform is an often-controversial alteration in the societal arrangements whereby government administers possession and use of land. Land reform may consist of a government-initiated or governmentbacked real estate property redistribution, generally of agricultural land, or be part of an even more revolutionary program that may include forcible removal of an existing government that is seen to oppose such reforms. • These reforms are meant to put ceilings on landholdings and are supposed to be an attempt to change tenancy regulations. 32
  • 31. • Pakistan has had a very extensive and diverse history of land reform. Most of the efforts usually failed and ended without any serious purpose, the reason for this was the great representation of the large landlords from the Punjab and Sindh in the central council of the Muslim league in 1947. Land lords comprised 163 out of 503 parliamentary members in 1942 which was the most significant group. Foundation of Pakistan only increased their power further, as many of them were able to acquire large tracts of land from Minorities by fleeing them at Cheap rates • In the early 1950s, provincial governments attempted to eliminate some of the absentee landlords or rent collectors, but they had little success in the face of strong opposition. • Before the land reforms of 1959 the distribution of land ownership was highly skewed in favor of a few large landlords who controlled large tact’s of land. 33
  • 32. • • The main reason to undertake land reforms by the Ayub regime was to set a limit to the amount of land, a landowner could own. The first was in 1959, when land reforms fixed the ceiling for private ownership of land at 500 acres irrigated and 1,000 acres unirrigated. However, this did little to better distribute the lands in the hands of the country's prosperous rural elite. It was more of a cosmetic exercise than a significant social change. • In all there were only 5,064 declarants, of which the ceilings on individual holdings affected only 15 percent or 763. • The area of land owned by the affected declarants was 5.5 million acres, of which only 1.9 million (35 percent) was resumed. The main portion of their land was retained by the landlords due to numerous provisions made in the law. 34
  • 33. • The 1972 reforms were different from those of 1959 in many respects. Firstly, the philosophy Bhutto reforms was based on the social democratic leanings of the Pakistan People’s Party. In March 1972, Z.A Bhutto gave a speech in which he said his land reforms would ‘effectively break up the iniquitous concentrations of landed wealth, reduce income disparities The land reforms were basically introduced in two ways: 1. Tenancy Regulation 2. The ceiling on Land ownership. 35
  • 34. 1. Tenancy Regulation The reasons for the rejecting a tenant were: • failure to pay rent • failure to cultivate land • sublet tenancy, or • rendered land unfit for cultivation. The water rate and cost of seeds were to be borne by the landlord. The cost of fertilizers and pesticides were to be shared equally by both parties. Land revenue and other charges were to be paid by the landlords in the past. Imposition of any cess and beggar was banned. The owner was selling his right to pre-emption in the case of land under his cultivation. That is, it gave tenants first rights of purchase. Other regulations increased tenants' security of tenure and prescribed lower rent rates. 36
  • 35. 2. The ceiling on Land ownership. • • In 1972 The Z.A Bhutto Government lowered the ceiling to 150-acres of irrigated and 300-acres of un-irrigated land of 12000 PIU, whichever was more for private ownership. No exemptions were allowed for the retention of orchards, stud or livestock farms and shikargah. • Exemption was only for owners of tractors and tubewells (of not less than 10 HP) who could retain an additional 2000 PIUs. • Unlike in 1959, land resumed from landowners would not receive any compensation and these lands were distributed among the landless tenants free of cost. In addition, all those peasants who had acquired land under the 1959 reforms and had outstanding dues, had their dues written off. • the land declared to be above ceiling by the landowners, only 42% was resumed in Punjab, while in Sindh it was 59%. In all, 0.6 million acres was resumed, far less than the 1959 figure and constituted only 0.001 % of the total farm area in the country. With other exemptions for tubewells and tractors, a family could have retained up to 932 irrigated areas in Punjab and 1120 in Sindh. • • The compensation to landowners on resumed land was given at Rs 30 per PIU. • There was redistribution of wealth as it was in 1972. 37
  • 36. Two views on land reforms • Equalitarian view The first view proposed on land reforms is equalitarian view. According to this view land reforms are done to remove the income disparity. This view has been propagated by liberals and the urban society at large. According to this class landless peasants are suffering at the hand of large land holders who are bent on exploiting them and not providing them good compensation for the work. • Rural elite view The rural elite which consist of the feudal lords stand on land reforms are that these measures of no good. In their understanding most of this takes place due pressure from urban elite who are only interested in destroying the power of the rural elite. They think all this leads to changing the society which will have long term consequences. 38
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