CPEC and the agriculture of Pakistan

ByElsa Sc S

Doing her graduation from LUMS & a keen researcher


August 13, 2022

Elsa Sc S can see the strong advantage of CPEC in the mainstay of Pakistan’s economy

Agriculture is the backbone of the economy of Pakistan and it constitutes more than 70 percent of all economic activity taking place in the country. Despite being the mainstay of Pakistani existence, agriculture in Pakistan suffers from lack of modernisation and anachronistic practices that hamper it to achieve its full potential. The farmers are the most neglected lot who in most of the cases do not own the titles to the land they till. The shortage of water since the preceding decades have gradually deprived cultivation of large areas resulting reduced output and decreased profitability.

The state shows scant interest in the welfare of the farming community and is equally disinterested in providing support to them. Agriculture currently accounts for 20 percent of Pakistan’s GDP but employs 43 percent of its labor force that is more than any other economic sector. Despite the size of the industry it has long been in the grip of water scarcity, energy shortages and poor-harvest infrastructure that are estimated to waste almost one –third of the country’s produce before reaching the market.

A ray of hope is now visible in shape of CPEC whose planners have evinced interest in the agricultural sector of Pakistan. Chinese are self-sufficient in agriculture and their farming techniques are well advanced. Their leadership has always exhibited keenness to see agricultural sector progress and while slowly transforming into an industrial juggernaut the Chinese never neglected agriculture at any stage. Chinese have always shown interest in Pakistani farming as they are aware that Pakistan possesses one of the finest canal systems in the world that unfortunately has not been properly taken care of. They are interested in developing agriculture sector of Pakistan by technology transfers, infrastructure upgrades, and extensive cooperation between Chinese and Pakistani farming enterprises under the framework of CPEC.

It is becoming increasing probable that Chinese enterprises will be allowed access to large tracts of Pakistani farmland, either by lease or purchase. It is also expected that they will be allowed to operate their own farms and processing facilities, backed by robust capital grants and loans from Beijing and the Chinese Development Bank. Owing to low tariffs and improvement in transportation Chinese produce is already prevalent in Pakistani markets and is competing with locally grown produce. The central idea behind providing access to Chinese farmers is that they will be able to show by example the modern techniques of cultivation and will also develop a healthy competition. Additionally, it is also envisaged that in future Chinese produce grown in Pakistan could potentially be exported to Chinese markets that will also accrue reasonable benefits for Pakistan.

An example of future cooperation between China and Pakistan through CPEC is the basmati rice grown in Punjab that is known for its exclusivity in being long and slender-grained. It is aromatic, fluffy when cooked and, in classic Pakistani dishes, pairs well with lentil and gravies made from chickpea flour and spices. Its excellence guarantees it double the market price for rice in comparison to non-basmati varieties. In recent years, however, basmati production and revenues recorded steep decrease owing to low-yield harvests and uneven quality. To reverse the trend Pakistani and Chinese scientists at Sino-Pakistan Hybrid Rice Research Centre at Karachi are working hard to find means to. Using state-of-the-art genetic technologies they are developing high-yield, high-quality, and pest-resistant rice varieties, for both domestic sale and export. The $1.3 million research facility is a harbinger of many changes soon to come to Pakistan’s agriculture sector under CPEC.

Farmers in Pakistan are not appropriately briefed by the government agencies about CPEC’s impending role in agriculture. The lack of information has given rise to rumours about the apprehensions that Chinese are about to take over vast fertile areas for cultivation. This notion is not corroborated by any evidence and the Chinese would prefer to run the farms as expatriate workers and not become landlords as the climate, social conditions and traditional milieu do not support such motive.

The farmer opinion is to see performance metrics imposed on Chinese enterprises entering Pakistan under CPEC. In exchange for land rights Chinese outfits could be asked to demonstrate quantifiable reductions in soil erosion or significant water collection in arid regions of the country. The government is however aware of this concern and is planning to regulate the matter to provide more equity in Pakistan’s dealing with China. The government plans to introduce guaranteed value chain participation for Pakistani growers that would imply that raw produce would be processed into higher-value products by canning, pureeing or pickling before being exported to China. It will also ensure quotas for Pakistani labour on Chinese-owned or operated farms. It will also emphasise completion of all requirements related to specific infrastructure projects pertaining to post-harvest storage facilities before Chinese enterprises are allowed to access Pakistani land. TW



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