Importance of Agriculture in Pakistan’s Economy

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Rimsha Dawood
Agriculture plays a vital role in Pakistan’s economy. It is considered the backbone of the economic system of Pakistan. It is the single largest sector and it is the principal driving force for growth and development of the national economy of Pakistan. Its direct contribution to the national economy of Pakistan is followed by its share in total GDP of Pakistan. In addition to providing food and raw material agriculture also provides employment opportunities to a very large percentage of the population. At the time of independence, Pakistan was primarily an agricultural based country. In the early time period it is considered a dominant sector but due to the decline in its performance due to the political, social, environmental and climate conditions its production yield goes down gradually and now it is the second-largest sector in Pakistan. Industrialization also took hold and Pakistan becomes a more diversified country by the time, but industrialization had not removed the existence of agriculture in Pakistan. The role of agriculture in the development of Pakistan’s economy cannot be denied as Pakistan still called as an agricultural country. Agriculture is the main source of national income for most developing countries. However, for developed countries, agriculture contributes a smaller percentage of their national income. Agriculture has a huge contribution towards the GDP of Pakistan economy. It contributes to 25% of the total GDP, which is larger than in other sectors of Pakistan. Increase in the GDP shows the developing progress of the economy. Pakistan ranks fifth in the Muslim world and 20th worldwide in agriculture output. This implies that agriculture has an important role in the economic development of Pakistan. Agriculture is the main source of livelihood of many people. Approximately 70% of people directly rely on agriculture as a source of living. A stable agricultural sector ensures a nation of food security. The main requirement of any country is food security. Food security prevents malnourishment that has traditionally been believed to be one of the major problems faced by developing countries. Since agriculture is the major source of employment in Pakistan as a result, the national income level as well as people’s standard of living is improved. The fast rate of development in agriculture sector offers progressive outlook as well as increased motivation for development. Agriculture is also the main source of raw materials to major industries such as cotton, jute fabric, tobacco, sugar and other edible as well as non-edible oils. Moreover, other industries such as vegetables as well as fruits get their raw material mainly from agriculture. The growth of the agricultural sector also contributes to marketable surplus. As agricultural sector development takes place, production increases and this leads to expansion of marketable surplus. This may be exported to other nations Pakistan plays a vital role worldwide as a rice exporter, and its annual exports approximately 2 million tons. Significance to the international trade agricultural products like sugar, tea, rice, spices, tobacco, coffee etc. constitute the major items of exports of Pakistan. Rice exports are the second-highest source of income in Pakistan which fulfils approximately 60% of the population of Pakistan’s food needs. As 68% of the country’s population resides in rural areas, improved agriculture could help Pakistan overcome poverty and improve the lives of farmers and also creating more jobs too. Pakistan should demonstrate an economic imagination and embrace technological innovation to boost its ailing agricultural sector. If there is good development of agriculture, imports can be reduced while export increases considerably. This would help to reduce the country’s unfavourable balance of payments as well as saving foreign exchange. This amount could be used to import other essential inputs, machinery, raw material and other infrastructure that is helpful for the support of the country’s economic development.

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