Table Of Content
Executive Summary 2
Development and Policies 5
Major Target Of Develop Plans 6
Emerging Issues 8
Neglects and Successes 11
Role Of Foreign Aid 15
Agricultural and Industrial Development 16
Farming is Pakistan's largest economic activity. In FY 1993, agriculture, and
small-scale forestry and fishing, contributed 25 percent of GDP and
employed 48 percent of the labor force. Agricultural products, especially
cotton yarn, cotton cloth, raw cotton, and rice, are important exports.
Although there is agricultural activity in all areas of Pakistan, most crops
are grown in the Indus River plain in Punjab and Sindh.
This topic is all about the agriculture sector of Pakistan in which we are
going to discuss the resources, mobilization, neglects, successes,
development, plans and some other points. This document will tell you
about the plans, policies like what are the policies regarding agriculture in
Pakistan. How the foreign aid is helping under developing countries like
Pakistan and what are the impacts on it? The major problem that we are
facing in this sector is the lack of technology and production techniques.
Now there comes a new problem of water that is still hanging between
Pakistan and India. This thing then arise the need to discuss the
agricultural and industrial development in our country.
Agricultural development planning
and resource mobilization
Pakistan's principal natural resources are arable land and water. About 25% of
Pakistan's total land area is under cultivation and is watered by one of the largest
irrigation systems in the world. Pakistan irrigates three times more acres than Russia.
Agriculture accounts for about 23% of GDP and employs about 44% of the labor force.
Pakistan is one of the world's largest producers and suppliers of the following according
to the 2005 Food and Agriculture Organization of The United Nations and FAOSTAT
given here with ranking:
• Chickpea (2nd)
• Apricot (4th)
• Cotton (4th)
• Sugarcane (4th)
• Milk (5th)
• Onion (5th)
• Date Palm (6th)
• Mango (7th)
• Tangerines, mandarin oranges, clementine (8th)
• Rice (8th)
• Wheat (9th)
• Oranges (10th)
Pakistan ranks fifth in the Muslim world and twentieth worldwide in farm output. It is
the world's fifth largest milk producer.
Wheat Fields in Punjab, Pakistan
The most important crops are wheat, sugarcane, cotton, and rice, which together
account for more than 75% of the value of total crop output.
Pakistan's largest food crop is wheat. In 2005, Pakistan produced 21,591,400 metric
tons of wheat, more than all of Africa (20,304,585 metric tons) and nearly as much as
all of South America (24,557,784 metric tons), according to the FAO (Food and
Pakistan has also cut the use of dangerous pesticides dramatically.
Pakistan is a net food exporter, except in occasional years when its harvest is adversely
affected by droughts. Pakistan exports rice, cotton, fish, fruits (especially Oranges and
Mangoes), and vegetables and imports vegetable oil, wheat, cotton, pulses and
consumer foods. The country is Asia's largest camel market, second-largest apricot and
ghee market and third-largest cotton, onion and milk market.
The economic importance of agriculture has declined since independence, when its
share of GDP was around 53%. Following the poor harvest of 1993, the government
introduced agriculture assistance policies, including increased support prices for many
agricultural commodities and expanded availability of agricultural credit. From 1993 to
1997, real growth in the agricultural sector averaged 5.7% but has since declined to
about 4%. Agricultural reforms, including increased wheat and oilseed production, play
a central role in the government's economic reform package.
Much of the Pakistan's agriculture output is utilized by the country's growing processed-
food industry. The value of processed retail food sales has grown 12 percent annually
during the Nineties and was estimated at over $1 billion in 2000, although
supermarkets accounted for just over 10% of the outlets.
The Federal Bureau of Statistics provisionally valued major crop yields at Rs.504,868
million in 2005 thus registering over 55% growth since 2000 while minor crop yields
were valued at Rs.184,707 million in 2005 thus registering over 41% growth since
According to the Economic Survey of Pakistan, the livestock sector contributes about
half of the value added in the agriculture sector, amounting to nearly 11 per cent of
Pakistan's GDP, which is more than the crop sector.
The leading daily newspaper Jang reports that the national herd consists of 24.2 million
cattle, 26.3 million buffaloes, 24.9 million sheep, 56.7 million goats and 0.8 million
camels. In addition to these there is a vibrant poultry sector in the country with more
than 530 million birds produced annually. These animals produce 29.472 million tons of
milk (making Pakistan the 5th largest producer of milk in the world), 1.115 million tons
of beef, 0.740 million tons of mutton, 0.416 million tons of poultry meat, 8.528 billion
eggs, 40.2 thousand tons of wool, 21.5 thousand tons of hair and 51.2 million skins and
The Food and Agriculture Organization reported in June 2006 that in Pakistan, the
world's fifth largest milk producing country, government initiatives are being undertaken
to modernize milk collection and to improve milk and milk product storage capacity.
The Federal Bureau of Statistics provisionally valued this sector at Rs.758,470 million in
2005 thus registering over 70% growth since 2000.
AGRICULTURAL DEVELOPMENT POLICIES AND
The scope for horizontal expansion in area brought about by quantum jump in water
supplies through commissioning of Mangla and Tarbela dams in 1970s and later on has
already touched a super saturation level. The major scope is now in vertical expansion
through improving farm productivity levels. This can be accomplished through raising
productivity of subsistent farming community to bridge the gap between the national
yields and yields of the progressive growers. The focus is the subsistent farmers who
lack behind in harvesting good yields. To achieve this objective, the productivity will be
increased through improvement in agronomic practices.
Pakistan being in the nexus of nuclear club of nations, it has to assure and safeguard
the continuity of the chain of food supplies. The sustainable domestic food security
through our own indigenous production is therefore an issue of prime importance in
Pakistan’s Agricultural Policy. The commodities that make an integral component of
food security are food grains, edible oils and sugar. Pakistan can ill afford a fragile or
marginalized situation in production of these commodities.
Pakistan’s cotton vision program targets cotton production to 15 million bales by the
year 2010. The Government is, therefore, determined to accelerate the cotton research
and development process necessarily required for a quantum jump in cotton production
and for the qualitative improvement matching the industrial requirements. At the same
time, it also intends to facilitate all the stakeholders, particularly the farming
community, through both the price and non-price measures to safe guard their
interests. For enhancing the cotton production, principally through increase in the
yield, the following arrangements / measures would be focused:
• Genetic Base of Commercial Cotton Varieties
• Strengthening of Foundation Seed Cell in Sindh
Major Targets of Develop Plans
Water Requirements by 2025
The major driving forces creating additional needs for water in Pakistan are
• Demographic pressure
• Rapid urbanization
• Socio-economic improvement
• Better recreational facilities
• Improved environment
• Expanded irrigated agriculture
Irrigated agriculture consumes by far the major quantity of freshwater in
Pakistan. Existing uses of available water include agriculture 93% (99 MAF), industry
3% (3.5 MAF) and households 4% (5.8 MAF). The existing water uses for crops is
wheat 30 MAF, rice 19 MAF, sugarcane 15 MAF, cotton 18 MAF, fruits and
vegetables 8 MAF and other crops 9 MAF.
Future water requirements (by year 2025) would be influenced by many factors.
The anticipated population by year 2010 would be 168 million with annual increase of
2% and 221 million by year 2025 with an average annual increase of 1.81%.
Accordingly water requirement to meet increased demand are to be met.
Water Vision 2025
Water vision 2025 envisages mega program including development of 64 MAF of
storage capacity with an investment of 50 billion over next 25 years in three
phases. Phase-1 comprises fast track projects to be completed in first 5-7 years
(2002-2006). This includes construction of Gomal Zam Dam, Mirani Dam, Greater
Thal Canal, Kachhi Canal, Rainee Canal, Raising of Mangla Dam and Satpara Dam.
These dams would add about 5 MAF and bring more than 0.8 million hectare of land
under cultivation besides generating 332 m.w. of power. Feasibility studies for
Basha Dam, Kurram Tangi Dam are underway. Detailed design of Sehwan
Barrage and Chashma 1 lift project would also be started.
Phase-II include Basha Dam on Indus with 5.70 MAF storage capacity and
power generation 3360 M.W, Sehwan Barrage on Indus with 0.65 MAF storage
capacity Phase- II of Thar Rainee Canal in Sindh, Phase II of the Greater Thal Canal
and a high Dhoke Pathan and combined storage from Sanjwal and Akhori Dams in
Phase-III would include Kalabagh Dam with Storage capacity of 6.10 MAF, Yugo Dam
on Syhok River in Northern Areas with 9.82 MAF capacity Skardu Dam with 15-52
MAF capacity and Kalan Dam on Swat River.
Water Management Strategy
• Improving water productivity.
• Institutional Reforms.
• High Efficiency Irrigation System.
• Operational Management of Canal.
• Adjusting cropping pattern with water availability.
• Harvesting Hill torrent in Rood Kohi and saliba area.
• Farmers’ awareness.
Intervention for Improvement of Water Productivity
The following proposals need to be made for improvement of water
• Farmer’s training.
• Precision land leveling/laser land leveling.
• Reduce tillage/resource conservation cultivation.
• Raised bed cultivation.
• Rain water harvesting (Barani areas/Rod Kohi).
• Drip and Trickle Irrigation System.
• Sprinkler Irrigation System.
• Watercourse lining and improvement.
• Water storage reservoir.
• Demonstration centers.
• On-Farm Drainage.
The conclusion is that Pakistan has so far undertaken a few small-scale
irrigation projects. The need for large-scale reservoirs is imperative. It takes a decade
to build up a dam once the earth breaking ceremony has taken place. It appears that
next decade in view of the changes in climate and lack of undertaking major water
projects both for capacity building and conservation of resources in delivery and at
the farm could be a period of difficulties. This situation will not only for agricultural
water but the drinkable water for human settlements and for the growing
industry can also pose a serious problem. The solution to this difficult situation is
that Pakistan should immediately go for large-scale capacity building for reservoirs,
conserve water resources through modern agronomic practices and encourage the
adoption of pressurized irrigation system as sprinkler/drip at least for high value
horticultural/ medicinal crops.
Ten Year Plan
A ten years investment plan of Rs. 36 billion has been prepared for developing
agriculture sector. These include:
• Initiation of Crop Maximization Project for developing centers of excellence in
109 villages across Pakistan for community extension to raise productivity of
crops and diversify farm income.
• Integration of Research and Extension Project to narrow the productivity gaps
between subsistence growers and progressive growers.
• Improvement in agriculture marketing through improving market information
system and removing distortions.
• Sugar beet production and promotion through intercrop culture. The
objectives is to raise farmers’ profitability and elongate crushing /slicing
season of sugar mills.
• Production of medicinal herbs.
• Building Livestock National Veterinary Laboratories to assure meat quality for
• Establishing Global Positioning System for monitoring movement of fishing ships.
The cultivable waste land:
According to the experts of MINFAL Pakistan has a total geographical area of 79.6
million hectares. Of this 9.1 million hectares land is cultivable waste which is fit for
cultivation but was not cropped due to lack of water availability, lack of interest,
financial resource constraints etc. Saying that cultivable waste area is almost half of the
cultivated area, the experts said that development of this area is not only better for
investment but also have potential to contribute to increase in agricultural production.
About half of the cultivable waste area (4.87 million hectors) is in the province of
Balochistan from total 9.14 mh while there are 1.74 mh cultivable lands in Punjab, 1.45
mh in Sindh, 1.08 mh in NWFP and NWFP.
Cultivable waste land in Balochistan is mainly in the Kalat Division followed by Quetta,
Nasirabad and Makran Divisions. In Punjab, cultivable waste area is mainly in the
Divisions of D. 0. Khan, Bahawalpur, Rawalpindi and Lahore. In Sindh, cultivable waste
area is located in Hyderabad, Mirpur Khas, Sukkur and Larkana Divisions. In NWFP,
cultivable waste area is located in D. I. Khan, Hazara and Kohat Divisions.
Cultivable waste land in Balochistan is mainly in the Kalat Division followed by Quetta,
Nasirabad and Makran Divisions. In Punjab, cultivable waste area is mainly in the
Divisions of D. G. Khan, Bahawalpur, Rawalpindi and Lahore. In Sindh, cultivable waste
area is located in Hyderabad, Mirpur Khas, Sukkur and Larkana Divisions. In NWFP,
cultivable waste area is located in 0. I. Khan, Hazara and Kohat Divisions.
FOCUS ON SMALL AND MEDIUM FARMERS
The number of small farms (less than 5 ha) is continuously increasing over the time. In
1962, the small farms were 45 percent of total farms whereas in 1972 this number
increased to 68 percent. According to Agriculture Census 1980, the small farms
increased to 74 percent and in 1990 the number further increased to 81 percent. The
leading factor causing this trend is the burgeoning population, which was growing at 3
percent per annum.
According to Agriculture Census 1990, there are 5.07 million farms in the country and
81 percent of them are small farms but account for 39 percent of total cultivated area.
The middle size farms (5-10 ha) are 12 percent and account for 22 percent of cultivated
area. The large farms (10 ha and above) are 7 percent of total farms but account for 40
percent of total cultivated area. The average size of small, medium and large farms is
1.8, 6.6 and
21.6 ha respectively.
All Government run programs in the shape of interventions are designed to primarily
focus on the drudgeries of small farmers. Some of these programs are provision of
agricultural credit, procurement of agricultural commodities, distribution of cotton seeds
in NWFP and Balochistan, distribution of agricultural machinery under cotton promotion
program and farmers visits abroad. The small farmers are given high priority in state
run development program in agriculture sector both in federal Government and
provincial Governments. Some of these are on farm water management program and
crop, livestock and fisheries development programs. The programs for tubewells
subsidies and subsidized tractor programs in the past were basically designed for small
and medium scale farmers. Small and Medium Enterprises (SME) Bank and Small
and Medium Enterprises Development Authority (SMEDA) are also active in providing
financial and technical support to small and medium scale farmers for setting up
enterprises in agriculture and ancillary sectors.
The middlemen sometimes secure up to 50 per cent or even more by exploiting
extreme conditions in the market. Farmers cannot sell their produce directly to
processors, factories and markets due to strong network of middlemen. If farmers take
their produce directly to markets, they have to face many problems due to close links of
middlemen with brokers, commission agents, transporters and market committees.
Commission agents refuse to buy produce from the farmers due to self-created low
For resolving the problems faced by farmers, the following steps need to be taken:
1. Strict marketing policy: The government has to go for new marketing policy to
cope with the challenge of new markets with special focus to streamline the role of
middleman and introduce regulations, which bind the limits of margins. The small
producers should be included in market committees. The government should also try to
encourage direct linkages between farmers and business houses to increase profit
margin for farmers.
2. Bargaining power: If farmers unite, they can easily minimize the role of
contractors in the supply chain. With the farmers’ union, farmers can have a stronger
voice to bargain collectively. Other options could be commodity exchanges and
3. Improvement in infrastructure: Due to poor infrastructure, farmers often have
difficulty in taking their produce to bigger markets and have to sell their produce at
lower cost in the local markets. With improvement in infrastructure, they can not be
connected to wider areas which could help them make more choices to sell wherever
they get a better price.
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4. Vicinities: Better access to bigger markets in near vicinities can provide farmers
with an opportunity to establish relations with bigger businesses and retailers. They
would no longer have to rely on middlemen and get their right share of profit. Markets
in the near vicinity would also reduce the cost of transportation.
5. Linkages: Establishing linkages with factories, processors and retail chains would
take away burden of middlemen off the farmers’ shoulder. Not only would farmers
benefit out of it but also factories, processors and modern retailers would greatly
benefit since middlemen have been acting as a buyer and seller between the two ends
and making more than 50 per cent of the profit. Efforts should also be made to make
arrangements so that growers of vegetables and fruits in the peri-urban areas can have
direct contact with the ultimate buyers.
6. Regulations: Since middlemen have established networks in the market, they rule
the market. The government should play its role as a watch dog in the market so that
forces of demand and supply can act freely in determination of prices.
Neglects & Successes:
Neglects: Kalabagh Dam
Irrigated agricultural is the backbone of Pakistan’s economy. At the same time with
word’s fastest growing population estimated to touch 150 million marks by the turn of
the century, there is a dire need to increase agricultural production. If nothing is done,
there would e approximately 25% shortfall in food grain requirements by the year 2000,
Judging from current (1997) two million tones import of wheat, by that time, Pakistan
could be one of the major food deficit countries in the world.
CONSEQUENCES OF NOT BUILDING KALABAGH DAM
• National food security would be jeopardized, thus subjecting the economy to
additional burden of importing food grains.
• Loss of storage capacity of the on-line reservoir due to sedimentation would
result in shortage of committed irrigation supplies causing serious drop even in
existing agriculture production.
• For implementation of water Apportionment Accord 1991, a new storage project
like Kalabagh is essential. In its absence it would give rise to bitter inter-
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provincial disputes and recriminations particularly in a dry water year. Dispute
between Punjab and Sindh on shortage of about 0.2 MAF water during Rabi
maturing/Kharig sowing 1993-94 should eye-opener. It may be worth mentioning
that Rabi 1993-94 had a normal river inflow pattern.
• Irrigation would affect in the future due to not building a Kalabagh Dam… It can
be said like a backbone of the Pakistan’s agricultural sector.
• It would be a great threat to the agriculture sector.
Role of PASCO
PASCO is the institution of the Pakistani government which deals with the purchase of
agricultural products like Wheat, Rice, Potatoes, and Sugar etc… This time, there is a
record cropping of wheat. But due to insufficient of funds, PASCO is not going to buy
the wheat on the rate set by the government. This will create the problems in future
regarding the attitude of farmers and cropping in the country.
In past year Pakistan was facing a number of problems regarding wheat, rice, sugar
etc. but through continuous improvement it covers these sectors, through availability of
products in the market. Like last year sugar crisis was on the top list, but now sugar is
available in the market but at high rate, that’s why people use it but in less amount.
Similarly is the case with potato sector, Frito-lays is the sub-brand of Pepsi, whose
seeds are imported and planted in lands of Pakistan this is good success for Pakistan
Mobilization of domestic resources; shortages,
deficits and role of Foreign Aid
Mobilization is the act of assembling and making both troops and supplies ready for
The Government of Pakistan in early 1960s started agricultural credit scheme
through Agricultural Development Bank of Pakistan (ADBP), renamed as Zarai
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Taraqiati Bank Limited (ZTBL). Recently, the Commercial Banks and Domestic Private
Banks have also started disbursing agriculture credit to the farming community.
Credit is provided to farmers for purchase of seeds, fertilizers, and pesticides as
well as for purchase of agricultural machinery.
Government policy with regard to agricultural credit is to safeguard the interest
of small/medium farmers by extending credit to them on easy term and to recover
the same in time as well as to protect them in case of any natural hazards and
calamity. Ministry of Food, Agriculture and Livestock is playing an active role to
monitor agricultural credit disbursement and conducts meetings to remove the
bottleneck/hurdles in disbursement.
Present regime gives special emphasis to resolve the credit problems of
Agriculture credit is provided for production and development purposes. Production
loan is being provided for agriculture input comprising of seeds, fertilizer, pesticides/
insecticides, poultry/animal feeds, chicks medicines, water charges, electric charges
for tube wells, labor, fuel and ice of marine fisheries. The development loan is
provided for agriculture machinery i.e. purchase of tractors, installation of tube
wells, pumping set, reapers, cutter binders, threshers, trolley, spray machinery and
The act of assembling and organizing national resources to support national objectives
in time of war or other emergencies. See also industrial mobilization.
Resources of mobilization:
There are five major resources of availability of capital to a country, i.e.
a) Capital may be raised through surplus budgeting
b) The profit earned from the public sector may be utilized for financing the
c) The government may borrow from its own people for promoting economic
d) The government may resort to deficit financing for supplementing domestic
saving and investment.
e) The government may receive economic assistance or aids or loan from other
countries to increase the rate of capital formation in country.
Need for resource Mobilization:
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Economic planning is an effective technique of mobilization of resoures internal and as
well as external, for the achievement of pre-determind economic goal.
Domestic resources or internal resources of a country comprise the purchasing power in
term of local currency representing saving plus foreign exchange earned by her citizens
or nationals and made available for development. External resources on the other hand,
consist of foreign exchange made available by foreigners plus the domestic purchasing
power also made available by foreigners.
Both internal and external resources referred to above are financial resources and these
are required to pay for the real resources consisting of manpower and its skill
technology, raw materials, capital equipment, managerial and supervisory personnel.
These real resources have to be purchase from domestic or international markets and
made available for financing and implementation of plan.
Domestic resources mobilization:
Domestic resources are raised by nationals of a country, because concerns and the
government. These are respectively known as private corporate and government
Private savings are composed of the surplus of private, income, over private
consumption and largely depend upon will to save and power to save of people.
Corporate or business savings are undistributed dividends or profits of the corporate
business. Government or public savings are the resources mobilized by the government
for making development projects. Public savings are also called forced savings if
generated through imposition of taxes. Public savings can also be raised through
floating of internal loans or deficit financing or both. Deficit financing although a
genuine technique of resources mobilization is however fraught with inflationary risk
and used only as a least resort.
Role Of Foreign Aid
Foreign aid is the transfer of resources from developed countries to under-developed
countries, either through bilateral donors or multilateral donors. Many countries in the
world accept foreign assistance and get different benefits along with a few adverse
results. Foreign aid takes place when a recipient country receives additional resources
in foreign currency over and above the capacity to import generated by exports.
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Foreign aid means those additional resources, which are used to raise the performance
of the recipient country above the existing level.
All kinds of resources inflow that are publicly granted and are made either from
government to government or from financial institutions to a government, only
economic aid is included while military aid is excluded. The main points of this definition
a. Resource inflow
b. Publicly granted
c. From government to government i.e. bilateral aid
d. From financial agencies to government i.e. multi-lateral aid
e. Economic aid, the aid that is used for economic purposes and for dams,
projects, industries etc.
In case of agriculture, Commodity Aid is very important and it is the aid that is given to
Pakistan or any UDC as it helps in advancement of this sector, For this, we would like to
discuss commodity aid.
It is type of aid, which relates to commodities such as agricultural products, raw
materials and consumer goods. It helps in controlling famine and maintaining the
tempo of industries by providing raw materials to the industrial sector. It would be
more helpful if it is provided in cash form because a country can then buy more
commodities from cheaper sources. Commodity aid some times has a depressing effect
on agriculture prices in a recipient country, so it serves as a disincentive for the
agriculture sector. The donor country may have much political influence on a recipient
Foreign Direct Investment
Foreign Direct Investment (FDI) is also included in the category of foreign aid. In
Pakistan, the examples of FDI are Lever Brothers, Reckitt and Colman, Bata, and Philips
It is sometimes argued that foreign direct investment is much cheaper for a recipient
country because it entails no payment of principal or interest. But it is also argued that
the profit outflow may exceed the amount of repayment. FDI brings technical know
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how to developing countries. But technical know how can be purchased at cheaper
rates on commercial basis if possible.
Agricultural VS Industrial Development Debate
There is much more to discuss agriculture and industrial sector of Pakistan. Agriculture
helps in industries to provide the raw materials like Cotton, Wheat, Sugar Cane etc…
Without the agriculture sector, industries can’t move on… They have to face and have
to pay the heavy cost of imports and that will ultimately affect the cost of the
production. The more cost of the goods is, the less the demand of our goods will be in
the foreign markets. Agricultural development becomes as important in this era as the
technology is going to obsolete very rapidly. Good techniques should be used in
agricultural sector in order to survive with the world. It will ultimately help in providing
the efficiency and effectiveness to the operations and as well as higher production with
good quality. This will then affect the quality of food available in the markets. In our
case of Pakistan, people give the importance towards the industrialization without
knowing the advancement in agricultural techniques. Pakistani government should focus
on agriculture sector. There are private groups who are involved in agriculture sector
and doing and earning well in this field. Ali Akbar Group is one of the respected groups
who takes agriculture as an important industry of Pakistan. Mansha group has recently
launched some of the projects related to agriculture. Mansha group is the Pakistan’s
biggest business group and the chairman of mansha group, “Mian Mohammad Mansha”
recently talked to Geo News about the importance of Agricultural development in
Pakistan. According to him, it would be one of the most profitable industry to invest and
earn more revenues from it.
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Development Planning In Pakistan by Muhammad Aslam
Economy Of Pakistan By Khawaja Amjad Saeed
"FAOSTAT Database Results".
UA&ItemTypes=Production.Crops.Primary&language=EN. Retrieved 2006-06-03.
Economic Survey of Pakistan, 2005-6
Business & Finance Review
Food Outlook - No. 1 June 2006
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