By Bakhtiar Iqbal
Agriculture remains the backbone of Pakistan’s economy. This sector employs almost 42 percent of the labor force, and provides a livelihood (including via ancillary services) to almost 62 percent of the population. The agriculture sector also contributes 18.9 percent to the country’s GDP. However, the sector has consistently underperformed for many years and displays some of the lowest levels of productivity in the world.
A recent seminar organized by the Consortium for Development Policy Research (CDPR) and the International Growth Center (IGC) in collaboration with the Punjab Government “Development in Punjab: Setting New Priorities in Agriculture and Industries” presented studies on the potential of using technology to overcome barriers to growth in agriculture.
While the share of agriculture in the GDP of an industrializing country typically goes down with time, increases in productivity due to technological advancements often ensure the sector does not stagnate. This has not happened in Pakistan. Over the past twenty years, the share of agriculture in GDP has gone down from 27 percent to 18.9 percent. Agricultural productivity also lags significantly behind the rest of the world. For example, Pakistan produces 3.1 tonnes of wheat per hectare compared to 8.1 in France, 2.5 tonnes of cotton compared to 4.8 in China, and 63.4 tonnes of sugarcane compared to 125.2 tonnes in China. Low yields have economy wide impacts; they result in lower incomes for farmers, lower export earnings, and also inhibit the growth of agricultural byproducts.
Reasons behind low productivity are multiple and varied. These include unpredictable and declining availability of water, the lack of cold storage solutions, inefficient logistics networks, declining investments in the agriculture sector, and poor extension services for farmers. As a result, it is estimated that nearly half of the agricultural output is wasted. The 3.81 percent growth observed in fiscal year 2017-18 was due to government policies in the form of subsidies and friendly procurement prices, which are at best short-term fixes.
Many of the problems hindering agriculture sector’s performance are systemic and hence pervasive across almost all economic sectors. Most issues will continue to affect productivity till major reforms are undertaken. However, improving extension services to farmers does not require any structural reform. Use of modern technology to enhance outreach to farmers and impact farming methods can result in significant improvements in productivity and yields.
Government of Punjab remains committed to improving service delivery in agriculture through the use of technology. Two ways in which the government is transforming agriculture in Punjab were discussed at the seminar and are presented below.
The innovative use of technology can greatly enhance the quality of agriculture extension services. One way is to propagate the use of precision farming – i.e. the practice of using information technology to make farming more efficient. Typically it involves the use of a wide variety of tools – such as GPS guidance, control systems, sensors, robotics, drones, autonomous vehicles, variable rate technology, GPS-based soil sampling, automated hardware, and telematics – to help farmers make better decisions about planting and growing crops. Based on these tools, farmers are given advice on soil quality, weather forecasts, fertilizer application, and a host of other factors. Precision agriculture is aimed at making farming activities more accurate and controlled to ensure profitability, sustainability, and efficiency.
Adeel Shafqat, researcher at the Center of Economic Research Pakistan, and project manager for Precision Agriculture for Development (PAD) discussed the objectives of this project and its contribution to easing provision of advisory services to farmers based in Punjab. PAD provides customized agricultural advice to farmers through mobile phones. The project has been developed in response to the recognition of the increasing availability of high quality agricultural data in developing countries such as Pakistan, but with poor access by farmers.
PAD uses a combination of phone calls, text messages and an application to build profiles of farmers, encompassing location, crop variety, water management, soil type, rainfall, and other variables to provide customized input and management advice. The most common areas in which farmers need advice include seed selection, fertilizer application, and pest and disease management. However, a major obstacle faced by PAD, and one that severely affects farm productivity, remains low literacy levels amongst farmers. The impact of ICT is constrained by its usability, leaving considerable scope for the efficacy of current extension workers.
Another way technology can be used is to incentivize extension workers to work more efficiently. Agriculture extension services continue to be plagued by capacity constraints impacting both the quality of information and outreach. In an-ongoing study, IGC researchers have partnered with the Agriculture Department in Punjab to help improve existing systems to monitor the performance of extension staff. Zahra Mansoor, a researcher at World Bank and working on the project, presented early findings from the study, testing interventions that best incentivize field staff. The project builds on AgriSmart, an application already in use by the department to track key performance indicators, manage human resource and obtain farmer feedback on quality of extension service. Early results of AgriSmart show substantial increases in individual farmer visits, time spent on extension services, and the total number of village visits.
The story that emerges from these two projects is that use of technology can make agriculture more efficient and profitable by providing accurate data to farmers and extension workers, and by improving the performance of extension workers themselves. While structural reforms are essential, there is no reason why poor extension services should continue to negatively affect productivity in the digital age.
Bakhtiar Iqbal is a Research Assistant at the Consortium for Development Policy Research
People say,Y is the sugar industry run by mafias and politicians ?
1st people have to understand that the sugar industry is based on the thesis,that cane is the easiest and highest risk adjusted return,for the farners – and to keep farners from starting a Tahrir or joining ISIS. Hence,over supply of cane and over-production of sugar,is an accepted reality of cane farming,in Pakistan
This ensures perpetual raw material supply for the mill,and a PASS THROUGH of all costs to the state – on a defacto basis.Defacto basis,is key,as there is no contractual arrangement for the pass through – which is a threat to the economic security of the state,as the mill owner can create shortages,spikes and supply and payments crisis and easily manufacture repetitive, but ingenious reasons for debt waivers,tax reliefs,export subsidies and drawbacks.
Excess cane production and sugar,is the disaster scenario for the Pakistani state.If there is a bad crop,international sugar prices would not rise,to an extent,to make imports on a duty free basis, costlier than the NSR to the sugar mill. In fact,the imported sugar could be sold at a profit to dealers,to more than offset the indirect tax revenue earned, by the state,on cane purchases by mills (mandii/purchase tax) and sale of sugar by mill (excise and sales and VAT tax)
Y is the mafia required in sugar ? dindooohindoo
To start strikes in mills of competitors
To divert raw material supplies of competitors
To set fire to bagasse stock of competitors
To monopolise truckers for mill logistics
To choke off the logistics for the mill competitors
To break unions in workers and truckers
For the above,a mill owner needs the support of the police,mafia and the neta
To manipulate raw material supplies,as under:
To downgrade and reject materials purchases
To delay purchase payments w/o delayed interest
To pick and choose cane suppliers
To tamper quality,moisture and weighnent tests
Using dummy names to route purchases from captive plantations
Route farmer purchases,as captive plantation purchases
To run a racket of farmers cane bills discounting
To organise dharnas/riots/logistics blockades, with the aid of farrners
To charge financial conversion charges for payments to farrners in cash
For the above,a mill owner needs the support of the police,mafia and the neta
To recover the costs of fire insurance and LOP insurance, there are accidental fires in bagasse stocks – once in 5 years, to recover,in bogus claims – the aggregate premiums paid over 5 years
To con the state in export subsidies and drawbacks
To con the state w.r.t CDR/OTS with banks
To con the state w.r.t capital and interest subsidies
To tamper the power consumption meters of CPP and power from grid – which is the only forensic proof of production
Bogus exports to eat up the subsidy and drawbacks – from land dry ports and sea ports
Routing exports proceeds on actual and bogus exports,via hawala and other modes
Manipulating cost,production and stock records to inflate costs,make off the books sales and purchases and hide stocks of finished goods
Selling bagasse in cash,instead of selling power to the grid
Creating shortages and spikes in prices of raw and processed/refined sugar Make fake cash purchase bills to generate cash for the sugar mill
For all the above,you need the mafia and the neta, AND also, since the farnmers are voters for the netas.Since the netas cannot outsource the political risk of the cane souring and payments,to a private party – and that,it is a no-loss, monopoly business,the netas are in the sugar mills,and will stay so,forever.