Pakistan Institute of Development Economics



Inclusive Agricultural Growth in Pakistan— Understanding SomeBasic Constraints

Inclusive agricultural growth is important for overalleconomic growth and particularly critical for rural socio-economicstability and poverty reduction in Pakistan. The majority of Pakistan‘spopulation and 44 percent of the overall labour force are dependent uponagriculture which only accounts for a little over 20 percent of nationalGDP. The paper highlights some basic constraints that have not beenexplicitly addressed in the policy research and implementation and haveimpeded inclusive agriculture growth. A descriptive analysis based ondata from the Agriculture Census of Pakistan and the Pakistan HouseholdIncome and Economic Survey—both of which were conducted in 2010-11—isused to show how high levels of poverty and its disparity acrossregions, combined with the declining size of operated holdings andassociated fragmentation especially in the smallest size categorieswhich now form over 60 percent of the agricultural holdings in Pakistan,are fundamental constraints. Poverty is both the result as well as theconsequence of fragmented markets, weak institutions includinggovernance; and, inadequate policy research and implementation. A betterresearch based policy understanding of some basic constraints, and thevariations across regions in such factors such as the declining size andfragmentation of operated farms, rural poverty; and, the levels ofmarket development and institutions is essential along with effectiveimplementation. One size fits all policies have not and will not work.JEL Classification: O40, Q15, I32, P46 Keywords: Inclusive Growth, LandHolding, Land Tenure, Income Distribution, Poverty

Sohail Jehangir Malik,

Asjad Tariq Sheikh,

Amir Hamza Jilani