Agriculture Sector: Value Addition

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The agriculture sector of Pakistan is in great need of value addition which however, is handicapped by a lack of interest and investment in modernization of the farming along with forging of both its backward and forward linkages.

Value Added Agriculture Output Witness a Surge

Value Added Agriculture net output has experienced a surge over the past decade which may be comprehended from the fact that it stands at $62 billion in the year 2016 as compared to $25 billion in the year 2006.

However, when it comes to vital factors like quality and diversity and not merely GDP Quantum the value addition in Pakistan agriculture still lags behind that of China and other countries.

Investment in Agricultural R&D and Technology Needed

A senior official of Ministry of National Food Security and Research was of the opinion that greater, higher-quality and high end value addition in agriculture requires a great deal of investment in fields like technologies and agricultural R&D. The official was also quick to point out that this is exactly where Pakistan agriculture sector is lacking.

Banks Role

This situation can also be understood from bank loans disbursements for the purpose of agricultural development and corporate farming. The average of the last 4 years in lieu of both these loans comes down to a figure of PKR 30 billion a year. Clearly much is left to be desired in this scenario and banks need to play an instrumental role to spur value-addition in this sector.

Food Processing and Packaging have Witnessed a Surge

The good news is that food processing and food packaging are growing with the passage of time and this depicts that the forward linkages have started to shape up.

The Gap between Food Crops and Value Addition is still a Wide One

However, the concerning factor which points out to the lost opportunity in this sector is that there still exists a huge gap between the output of food crops and the scale on which the value addition process is being carried out.

It seems that unless and until all possible efforts are undertaken to bridge this gap the potential of this sector will remain untapped.

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