Pakistan Institute of Development Economics



Growth of Output and Productivity in Pakistan’s Agriculture: Trends, Sources, and Policy Implications

The paper aims to review the growth performance of Pakistan’s agriculture from 1950 to 1995. The long-term growth rate of agriculture, although respectable, has exhibited considerable yearly fluctuations even between decades. The period of the fifties and early seventies lacked any growth. Accelerating and high growth rates marked the decade of the sixties but the performance has not been satisfactory since 1979-80 and average growth rates have barely exceeded the population growth rate, with widespread implications for growth of national economy, food security, and social welfare of the masses. Area, modern inputs, and technology have been the major determinants of growth but prices were equally important because of their incentive and disincentive effects. The agriculture price policies adopted during the 1980s are known to have had a negative effect on the development and use of technology in agriculture. In order to boost agricultural productivity, a change in price policy is needed to ensure incentive prices. This could be done by setting agricultural commodity prices at par with corresponding import and export parity prices. A higher investment in research and development can hardly be overemphasised. There is an urgent need to remove the bottlenecks in agricultural input markets since these markets represent the typical monopoly position. To break up the monopoly of registered dealers and to promote competition, free sales in the open market by interested parties and individuals may be allowed.

Ghulam Mustafa Chaudhry, M.Ghaffar Chaudhry, Muhammad Ali Qasim