By Azeem Ahmed Khan

Pakistan’s agricultural future remains bright, provided the country embraces smart reforms, climate resilience, and consistent policies, Dr. Muhammad Zeshan, Director of the Center for Agriculture, Climate Change & Rural Economy at the Pakistan Institute of Development Economics (PIDE), said.

“Agriculture contributes nearly 24% to Pakistan’s GDP,” he said, highlighting the sector’s critical importance. However, with climate change altering rainfall patterns and intensifying heatwaves, he stressed that preparedness must now become a national priority.

Talking to Wealth Pakistan, Dr. Zeshan noted that while many countries allocate significant portions of their GDP to climate adaptation, Pakistan currently spends a meager amount. Strengthening climate resilience, particularly through crop insurance and local water storage, could dramatically improve farmer security.

“The world has crop insurance systems. Farmers need protection against unpredictable climate shocks,” he emphasized, adding that introducing government-facilitated crop insurance would encourage farmers to invest confidently in high-value crops.

He also called for small, locally managed water reservoirs to reduce dependence on canal systems and ensure reliable irrigation even during river shortages. Expanding localized water infrastructure, he said, would empower farmers and stabilize yields.

Dr. Zeshan identified population growth as a key pressure point. With a 2.6% annual growth rate, food demand is rising rapidly, while farm sizes are shrinking due to land division among heirs. Average farm sizes have fallen from 6.5 acres in 2010 to around 5 acres today.

Smaller farms reduce mechanization, making it harder to produce standardized, export-quality crops. As a solution, Dr. Zeshan advocated cooperative farming models, where farmers pool land and resources to function as large, efficient units.

“Through cooperatives, farmers can access financing, better seeds, machinery, and meet international quality standards,” he explained. However, he stressed that effective enforcement of contract law is essential to building trust in such arrangements.

Once self-sufficient and a major exporter, Pakistan’s cotton sector has struggled in recent years. Dr. Zeshan pointed out an imbalance in incentives: local cotton farmers pay 18% GST, while imported cotton faces no such tax.

“This discourages domestic farmers and incentivizes foreign producers,” he said. Equalizing the tax structure, rather than offering subsidies, could restore fairness and motivate farmers to return to cotton cultivation.

He also emphasized the need for research into pest-resistant seed varieties, as insects have developed resistance to conventional sprays.

Water scarcity is often framed as a supply issue, but Dr. Zeshan believes it is equally a matter of efficiency. Agriculture consumes 90% of Pakistan’s water, often through inefficient flood irrigation methods.

“Introducing proper water pricing and efficiency measures can significantly reduce wastage,” he said. With better management, Pakistan could overcome much of its water stress.

One of the sector’s biggest structural issues, according to Dr. Zeshan, is the lack of a functioning market mechanism. Farmers rely heavily on government procurement and often lack access to certified seeds and organized seed banks.

“We need to gradually shift toward a market-based system,” he said. With government finances under pressure, building private-sector participation and reducing reliance on procurement pricing is essential.

He stressed that reforms must be gradual and carefully managed to avoid shocks to farmers.

Pakistan currently relies heavily on four major cash crops — cotton, wheat, corn, and sugarcane — many of which are water-intensive. Dr. Zeshan encouraged diversification into crops such as olives, which require less water and could reduce the country’s $3–4 billion annual edible oil import bill.

“Olive cultivation presents a strong investment opportunity in suitable regions,” he said, describing it as a climate-smart alternative.

Dr. Zeshan underscored the importance of research funding, noting that less than 0.5% of GDP is spent on research in Pakistan. Boosting research investment would strengthen food security, improve seed quality, and support innovation.

Above all, he called for policy consistency.

“Agriculture cannot function on six-month policy shifts. Farmers and investors need four to five years of clarity to plan effectively,” he said. Stable policies would encourage cooperative farming, private investment, and stronger linkages between agriculture and industry.

While acknowledging that the challenges did not arise overnight, Dr. Zeshan remained optimistic. With climate-smart investments, market reforms, water efficiency, crop diversification, and consistent policies, Pakistan can revitalize its agricultural sector.

“The transformation will take time,” he said. “But with steady reforms and institutional support, agriculture can become self-reliant and resilient again.”

Credit: INP-WealthPk