Revitalising agriculture sector of Pakistan

Outline

1. Introduction
2. Agriculture as the backbone of Pakistan’s economy and food security
3. The paradox of agricultural importance and low productivity
4. Water scarcity and inefficient irrigation as the central challenge
5. Outdated farming practices and weak mechanization
6. Poor seed quality, limited research and weak extension services
7. Climate change and the growing vulnerability of agriculture
8. Fragmented landholdings and structural inefficiencies
9. Agricultural credit and the financial exclusion of small farmers
10. Market distortions, middlemen and weak farm to market linkages
11. Post harvest losses, storage and lack of value addition
12. Livestock, fisheries and high value agriculture as neglected opportunities
13. Agricultural exports and the need for diversification
14. Technology, precision farming and digital agriculture
15. Reforming subsidies, procurement and price support mechanisms
16. Strengthening agro based industry and rural employment
17. Empowering women and youth in the rural economy
18. A coherent national strategy for agricultural revival
19. Conclusion

Essay

Agriculture remains one of the most important foundations of Pakistan’s economy, yet it is also one of the clearest examples of the country’s unrealized potential. The sector provides food, employment, raw material for industry and foreign exchange, while the prosperity of millions of rural households depends directly upon it. According to the Pakistan Economic Survey 2025–26, agriculture still accounts for about 23.4 percent of national GDP, while livestock alone contributes more than 14 percent. Despite this importance, agricultural productivity remains constrained by water inefficiency, outdated technology, weak research, poor market structures, climate vulnerability and fragmented policy. Pakistan therefore does not face an agricultural crisis because it lacks fertile land, farmers or natural potential. It faces one because the sector has not been modernized at the pace demanded by population growth, climate change and global competition. Revitalising agriculture requires a shift from subsistence and low productivity farming towards a modern, climate resilient and market oriented agricultural economy.

The importance of agriculture extends far beyond its direct contribution to GDP. Pakistan’s food security depends upon wheat, rice, sugarcane, maize and other major crops, while cotton remains closely linked with the textile industry, the country’s largest export sector. Livestock provides income to millions of rural households and has become the largest component within agriculture itself. Agriculture also supports transport, food processing, fertilizer, machinery, storage and retail industries. When the sector performs well, rural incomes rise and demand expands across the broader economy. When it suffers, the consequences appear in food inflation, import requirements, industrial shortages and rural poverty. Agricultural revival is therefore not a sectoral issue; it is a national economic necessity.

Pakistan’s central agricultural problem is not simply insufficient production but low productivity relative to its potential. The country has one of the world’s largest irrigation systems and favourable agro climatic zones, yet yields for several major crops remain below those achieved by more efficient agricultural economies. Output often expands through increased acreage or favourable weather rather than sustained improvements in productivity. This makes agriculture vulnerable to climate shocks and fluctuations in input costs. The Pakistan Economic Survey shows that agriculture grew by 2.89 percent in 2025–26, but important crops recorded only modest growth, while cotton and maize remained weak. Such uneven performance demonstrates that Pakistan needs structural reform rather than occasional recovery.

Water is perhaps the most serious constraint. Pakistan’s agriculture developed around the Indus Basin irrigation system, but the very abundance of canal irrigation historically encouraged inefficient use. Flood irrigation remains common, water losses occur through poorly maintained canals and watercourses, and farmers often cultivate water intensive crops in areas where water is increasingly scarce. Climate change is further reducing predictability as glacier melt, irregular rainfall, drought and flooding alter the availability of water. Agriculture cannot remain viable if every additional unit of output requires excessive water. Pakistan must therefore move from simply supplying more water towards producing more crop per drop.

Modern irrigation technologies can play a major role. Drip and sprinkler systems, laser land levelling and improved watercourse management can significantly reduce wastage. However, technology must be adapted to farm size and affordability. Small farmers cannot be expected to adopt expensive systems without credit and technical support. Water pricing also deserves careful reform. Extremely cheap or poorly regulated water creates little incentive for efficiency, but sudden price increases could devastate small farmers. Reform should therefore combine better measurement, incentives for efficient use and targeted support for vulnerable producers.

Pakistan must also reconsider cropping patterns. Sugarcane and rice provide income and export earnings, but they can consume large amounts of water. Agricultural policy should increasingly encourage crops suited to regional water availability and market conditions. Pulses, oilseeds, horticulture and other less water intensive crops can reduce import dependence and increase farmer income. Crop diversification would also protect farmers from excessive dependence on a few commodities and strengthen food security.

Weak access to quality seeds represents another major productivity constraint. Certified high yielding and climate resistant seed varieties can dramatically improve output, yet many farmers rely upon informal seed markets or reuse older varieties. Agricultural research institutions need greater investment and stronger links with farmers. Pakistan requires seed varieties resistant to heat, drought, salinity, pests and changing rainfall patterns. Research should not remain confined to laboratories; it must reach farms through effective extension services.

Agricultural extension itself needs modernization. Traditional systems often lack sufficient personnel and are unable to provide timely advice to millions of farmers. Digital platforms can help bridge this gap. Farmers can receive weather forecasts, pest alerts, market prices and cultivation advice through mobile applications and messaging services. Satellite imagery and remote sensing can help identify crop stress and water shortages. Precision agriculture can reduce unnecessary use of fertilizer, pesticides and water. Yet digital transformation will produce limited benefits unless rural connectivity and farmer literacy improve at the same time.

Mechanization is equally necessary. Small and medium farmers often lack access to modern machinery for planting, harvesting and post harvest handling. Mechanization can reduce labour costs, improve timing and limit crop losses, but it does not require every farmer to purchase expensive equipment individually. Machinery rental centres, cooperatives and private service providers can make equipment accessible to smaller farmers. Agricultural modernization should therefore focus on access rather than ownership alone.

Climate change now makes reform even more urgent. Pakistan is among the countries highly exposed to floods, heatwaves, droughts and changing rainfall patterns. The severe floods of recent years demonstrated how quickly agricultural losses can become a national economic crisis. FAO reported that flooding in 2025 again damaged crops, livestock, food stocks and infrastructure across affected areas, worsening food insecurity for vulnerable households. Climate resilient agriculture must therefore become central to planning. This includes drought tolerant seeds, flood resistant infrastructure, improved drainage, crop insurance and better weather forecasting.

The changing climate also requires a stronger agricultural insurance system. Farmers who lose crops to floods or drought often fall into debt and reduce investment in the next planting season. Crop insurance can spread risk, but Pakistan’s existing mechanisms remain limited. Public private insurance schemes linked with digital land records and satellite monitoring could make compensation faster and reduce fraud. Risk management must become as important to agricultural policy as production targets.

Land fragmentation presents another structural problem. Repeated inheritance divides farms into increasingly small plots, making mechanization and efficient irrigation more difficult. Small farmers should not be displaced merely in the name of efficiency, but cooperative arrangements can allow them to share machinery, storage and marketing facilities. Land records should also be digitized more comprehensively to reduce disputes and improve access to formal credit. Farmers without clear documentation struggle to use land as collateral and often depend upon informal lenders.

Agricultural finance remains heavily unequal. Large farmers generally have easier access to formal credit, while smaller farmers often borrow from input dealers or middlemen under unfavourable conditions. This dependence weakens their bargaining power when crops are sold. Banks and microfinance institutions need agricultural lending products adapted to crop cycles and farm size. Digital financial services can reduce transaction costs and improve access, but credit must be accompanied by financial literacy to prevent over indebtedness.

The role of middlemen is another source of controversy. Intermediaries perform genuine functions such as transport, aggregation and financing, but weak competition can allow excessive margins between farm gate and retail prices. Farmers may receive low prices while consumers simultaneously pay high prices. Better wholesale markets, digital trading platforms, farmer cooperatives and direct contracting with processors can improve price discovery. The objective should not be to eliminate every intermediary but to create transparent and competitive supply chains.

Post harvest losses represent one of the most avoidable weaknesses in Pakistan’s agricultural system. Fruits and vegetables can lose significant value because of poor storage, packaging, cold chains and transport. Grain quality also deteriorates when storage is inadequate. This means Pakistan can increase food availability and farmer incomes without necessarily cultivating additional land simply by preserving a larger share of what it already produces. Cold storage, refrigerated transport, modern warehouses and commodity grading should therefore receive the same policy attention as crop production.

Value addition is equally important. Pakistan often exports agricultural commodities in relatively raw form and therefore captures only a limited share of their final market value. Cotton creates more wealth when converted into finished garments, milk when processed into branded dairy products and fruits when processed, packaged and marketed internationally. Agro processing can create rural employment, increase exports and reduce post harvest losses. Agriculture should therefore be integrated more closely with industry rather than treated as a separate rural activity.

Livestock is particularly important because it is already the largest component of Pakistan’s agricultural sector. The Economic Survey 2025–26 reports that livestock contributes around 62 percent of agricultural value added and grew by 3.75 percent during the year. Yet productivity per animal remains relatively low in many areas because of weak breeding, inadequate veterinary care, poor feed and limited cold chain infrastructure. Improving animal health, genetics, vaccination and meat and dairy processing could create major export opportunities while strengthening rural incomes.

Fisheries and aquaculture also remain underdeveloped. Pakistan has a long coastline and significant inland water resources, yet the sector contributes only a small share to agricultural output. Better cold chains, processing standards, sustainable aquaculture and improved harbour infrastructure could expand seafood exports. The broader lesson is that agricultural policy should move beyond an excessive focus on a few field crops and recognize the potential of livestock, fisheries, horticulture and high value agriculture.

Export diversification is equally necessary. Rice remains one of Pakistan’s strongest agricultural exports, but dependence on a narrow basket leaves the country vulnerable to price and climate fluctuations. Processed food, halal meat, fruits, vegetables, dairy products and fisheries could become larger foreign exchange earners if Pakistan improves quality certification, traceability and compliance with international sanitary standards. Export competitiveness begins at the farm but depends equally upon laboratories, packaging, logistics and trade diplomacy.

Government intervention in agricultural markets also requires reform. Price support and procurement can protect farmers against sudden market collapse, but poorly designed policies can create distortions, fiscal burdens and uncertainty. Recent fluctuations in wheat policy illustrate how changes in procurement and support mechanisms can influence planting decisions and domestic prices. FAO reported that changes in wheat support policy affected planting decisions in 2025, while later measures to resume procurement encouraged farmers to increase wheat planting for 2026. Policy consistency is therefore crucial. Farmers make production decisions months before harvest and cannot operate efficiently when government signals change abruptly.

Subsidies should also be targeted more intelligently. Large untargeted subsidies on fertilizer, electricity or irrigation frequently benefit larger farmers disproportionately and encourage inefficient resource use. Support should increasingly reward productivity, efficient water use, quality seeds and adoption of climate resilient technologies. Agricultural policy should help farmers become more competitive rather than permanently dependent upon subsidies.

Rural development must accompany agricultural reform. Farmers cannot become productive if villages lack roads, electricity, storage, schools, healthcare and digital connectivity. Rural infrastructure reduces transport costs, improves access to markets and creates non farm employment. This is especially important because not every rural household can or should remain dependent entirely upon farming. Agro processing, logistics, small manufacturing and services can diversify rural incomes and reduce pressure on land.

Women deserve greater recognition within this process. Women perform substantial agricultural work in livestock care, harvesting, household food production and other activities, yet they often have limited access to land ownership, credit and formal decision making. Improving women’s access to training, finance and agricultural technology would raise productivity and household welfare. Their contribution should be treated as economic participation rather than invisible family labour.

Pakistan’s large youth population can also become a force for agricultural modernization. Younger farmers are generally more open to technology, digital markets, mechanization and new business models. Agriculture, however, is often viewed by educated youth as an occupation of last resort because it is associated with low productivity and uncertain income. Modern agribusiness, food processing, agricultural technology and precision farming can change this perception. The future of farming depends upon making agriculture intellectually and economically attractive to a new generation.

Institutional coordination remains perhaps the most difficult challenge. Agriculture is largely a provincial subject, while trade, water, climate, finance and national food security involve multiple levels of government. Fragmented responsibilities often produce fragmented policies. Pakistan needs stronger coordination between federal and provincial institutions without reversing constitutional devolution. Research, water management, export policy and climate adaptation should be aligned around long term national objectives.

A coherent strategy should therefore rest on several principles. Pakistan must increase yield rather than merely acreage, conserve water rather than assume unlimited supply, diversify crops and exports, strengthen research and technology, improve agricultural finance, reduce post harvest losses and integrate farming with industry. Above all, policies must become predictable. Agriculture cannot modernize when farmers, investors and processors repeatedly face abrupt changes in taxation, imports, exports and procurement.

Conclusion

Revitalising Pakistan’s agriculture sector is not merely a matter of increasing crop production. It requires transforming the entire agricultural system from seed to market. Pakistan already possesses fertile land, a vast irrigation network, experienced farmers and considerable diversity in crops, livestock and ecological zones. The problem is not the absence of potential but the failure to convert that potential into sustained productivity.

Water scarcity, climate change, low yields, fragmented landholdings, weak research, inadequate finance and inefficient markets have made traditional agricultural practices increasingly unsustainable. Continuing with the same model while the population grows and climate pressures intensify will increase food insecurity, rural poverty and dependence on imports.

The solution lies in modernization with inclusion. Efficient irrigation, improved seeds, mechanization, digital agriculture and climate resilient farming can increase productivity, but small farmers must be able to access these technologies. Market reforms can improve farmer income, but transparency and competition must prevent new forms of exploitation. Export growth can generate foreign exchange, but domestic food security must remain protected.

Pakistan should also broaden its understanding of agriculture beyond wheat, cotton and sugarcane. Livestock, fisheries, horticulture, food processing and high value crops can become major engines of rural growth. Stronger integration between agriculture and industry can create jobs, reduce post harvest losses and increase the value of exports.

Most importantly, agricultural reform must become a long term national commitment rather than a sequence of emergency packages. Farmers make decisions across seasons, while irrigation systems, research institutions and food supply chains require years to improve. Policy consistency is therefore as important as financial investment.

Pakistan’s agricultural future will ultimately depend upon whether it continues treating farming as a traditional sector to be protected or transforms it into a modern productive economy to be developed. Agriculture has sustained Pakistan for generations. With science, technology, better governance and smarter use of water, it can do far more than merely sustain the country. It can become one of the foundations of food security, export growth, rural prosperity and national economic resilience.