High Food Prices Boost Pakistan's Rural Economy
Since taking the reins of power almost three years ago, the coalition government in Islamabad, which is led by the Pakistan Peoples' Party, has been increasing the support prices of wheat and other agricultural commodities every year. This policy has had the following effects:
1. It is transferring the additional new income of about Rs. 300 billion in the current fiscal year alone to the ruling party's power base of landowners in small towns and villages, from those working in the urban industrial and service sectors.
2. It has driven up food prices dramatically for all Pakistanis, particularly hurting the poor people the most.
3. It has reduced government tax revenues because the agricultural income is not taxed by either the federal or the provincial governments, and resulted in growing budget deficits.
4. It has significantly increased demand for consumer and industrial goods and services in the rural areas.
5. It has forced the State Bank of Pakistan to maintain a tight monetray policy which is drying up the much-needed credit for the industries and the average consumers alike.
6. It's likely to slow rural-to-urban migration and relieve pressure on major cities and their inadequate infrastructure.
In 2008, the government pushed the procurement price of wheat up from Rs. 625 per 40 kg to Rs. 950 per 40 kg. This action immediately triggered inflationary pressures that have continued to persist as food accounts for just over 40% of Pakistan's consumer price index. According to State Bank of Pakistan (SBP) analysis, cumulative price of wheat surged by 120 per cent since 2008, far higher than the 40 per cent between 2003 and 2007. it is also many times greater than the international market price increase of 22 per cent for wheat in the same period. Similarly, sugar prices have surged 184 per cent higher since 2008, compared with 46 per cent increase during 2003-07.
The transfer of additional Rs. 300 billion to Pakistan's agriculture sector during the current fiscal year 2010-2011 by higher prices of agriculture produce and direct flood compensation to 1.6 million affected families at the rate of one hundred thousands rupees each will boost economic confidence in the countryside. It will generate rural demand for consumer items including consumer durables such as fans, TVs, motorcycles, cars, refrigerators, etc.
The big feudal landowners have been the biggest beneficiaries of the PPP's gift of high crop prices. However, the policy has helped small farmers as well, as shown by a recent survey reported by The Nation newspaper. The survey of 300 farmers in Sind's Sukkur district was conducted by Sukkur Institute of Business Administration for the State Bank of Pakistan (SBP). It has highlighted the following about district's rural economy:
1. In Sukkur district, majority of the farmers are subsistence farmers. 31 percent of them own less than 5 acres of land, and another 34 percent own up to 12.5 acres of land.
2. They spend an average of Rs. 1,611 a month on their children's education, with some of them spending up to Rs. 12,000 a month.
3. Wheat, rice, cotton and sugarcane are the major crops being cultivated by 93 per cent, 58 percent, 37 percent and 12 percent of the respondent farmers in that order.
4. 24 percent of them are also growing fruits including dates, mangoes and bananas.
5. 22 percent of the respondent own livestock.
6. About half (49 percent) use privately purchased seeds for wheat cultivation, 33 perecent use their own retained seed and 18 perecent use the seed purchased from Public Sector Seed Corporations.
7. On average, a farmer uses 96.73 Kg chemical fertilizer per acre with the maximum and minimum of 350 Kg and 40 Kg respectively. The average per acre cost of wheat production is Rs. 10,670.
8. All 300 farmers are using tractors for cultivation and preparing land for crops, and some are using tractors for fetching their crop produce to market.
Already, the upside of the government policy is that Pakistan's rural economy is being spurred by high crop prices that may help the GDP growth this year and next. Increased farm incomes are whetting the rural households' appetite for industrial and consumer goods in 2011 and beyond.
A key indicator of growing rural economy is the double digit increase in the sale of tractors. Millat Tractors Limited, the largest supplier of tractors in Pakistan, had record sales of 41,500 tractors in the calendar year 2010, an increase of nearly 11% over 37,537 tractors sold in 2009. Of these 41,500 tractors, a record 5000 tractors were sold in the month of Dec, 2010 alone, acording to The Nation newspaper. Millat sold 10,000 units under Benazir Tractor Scheme and 5,000 units under the Sindh government tractor scheme in the last fiscal year. Another 10,000 units were sold as part of the Punjab government scheme, 70 per cent of the units were sold, according to Dawn News.
Earlier, the sales of Fiat and Massey Ferguson tractors grew to 1,632 and 3,194 units in September 2010 from 537 and 3,100 in August 2010. The overall sales of these tractors rose to 13,931 during July-September 2010 as compared to 12,690 units in the same period of 2009, according to Dawn news.
Over 50 per cent of the motorcycles and 40-45 per cent of cars in Pakistan are purchased by people living in rural areas. Total car sales in July-September 2010(including Suzuki Bolan) rose by 12 per cent to 30,030 units as compared to 26,812 units in the same period of 2009, according to Pakistan Automotive Manufactureres Association PAMA). Furqan Punjani of Topline Securities said car sales are expected to reach 154,000 units by the end of June 2011.
In addition to rising demand for cars and tractors, there is also an upward trend in two-wheeler sales. The cumulative sales of motorcycles in July-September 2010 rose to 126,701 units from 105,862 units in the same period of 2009.
While it is good to see Pakistan's rural farm economy perk up, it is also important to recognize that the overall national economic outlook can not improve significantly unless the growing budget deficits and rising inflation are brought under control. And this will require the ruling feudal elite to pitch in by paying their fair share of income tax on their rising farm incomes. It is time for them to lead by example.
Related Links:
Haq's Musings
Pakistan's Exports and Remittances Rise to New Highs
Sugar Crisis in Pakistan
Agricultural Growth in India, Pakistan and Bangladesh
Pakistan's Rural Economic Survey
Pakistan's KSE Outperforms BRIC Exchanges in 2010
High Cost of Failure to Aid Flood Victims
Karachi Tops Mumbai in Stock Performance
India and Pakistan Contrasted in 2010
Pakistan's Decade 1999-2009
Musharraf's Economic Legacy
World Bank Report on Rural Poverty in Pakistan
USAID Report on Pakistan Food & Agriculture
Copper, Gold Deposits Worth $500 Billion at Reko Diq, Pakistan
China's Trade and Investment in South Asia
India's Twin Deficits
Pakistan's Economy 2008-2010
1. It is transferring the additional new income of about Rs. 300 billion in the current fiscal year alone to the ruling party's power base of landowners in small towns and villages, from those working in the urban industrial and service sectors.
2. It has driven up food prices dramatically for all Pakistanis, particularly hurting the poor people the most.
3. It has reduced government tax revenues because the agricultural income is not taxed by either the federal or the provincial governments, and resulted in growing budget deficits.
4. It has significantly increased demand for consumer and industrial goods and services in the rural areas.
5. It has forced the State Bank of Pakistan to maintain a tight monetray policy which is drying up the much-needed credit for the industries and the average consumers alike.
6. It's likely to slow rural-to-urban migration and relieve pressure on major cities and their inadequate infrastructure.
In 2008, the government pushed the procurement price of wheat up from Rs. 625 per 40 kg to Rs. 950 per 40 kg. This action immediately triggered inflationary pressures that have continued to persist as food accounts for just over 40% of Pakistan's consumer price index. According to State Bank of Pakistan (SBP) analysis, cumulative price of wheat surged by 120 per cent since 2008, far higher than the 40 per cent between 2003 and 2007. it is also many times greater than the international market price increase of 22 per cent for wheat in the same period. Similarly, sugar prices have surged 184 per cent higher since 2008, compared with 46 per cent increase during 2003-07.
The transfer of additional Rs. 300 billion to Pakistan's agriculture sector during the current fiscal year 2010-2011 by higher prices of agriculture produce and direct flood compensation to 1.6 million affected families at the rate of one hundred thousands rupees each will boost economic confidence in the countryside. It will generate rural demand for consumer items including consumer durables such as fans, TVs, motorcycles, cars, refrigerators, etc.
The big feudal landowners have been the biggest beneficiaries of the PPP's gift of high crop prices. However, the policy has helped small farmers as well, as shown by a recent survey reported by The Nation newspaper. The survey of 300 farmers in Sind's Sukkur district was conducted by Sukkur Institute of Business Administration for the State Bank of Pakistan (SBP). It has highlighted the following about district's rural economy:
1. In Sukkur district, majority of the farmers are subsistence farmers. 31 percent of them own less than 5 acres of land, and another 34 percent own up to 12.5 acres of land.
2. They spend an average of Rs. 1,611 a month on their children's education, with some of them spending up to Rs. 12,000 a month.
3. Wheat, rice, cotton and sugarcane are the major crops being cultivated by 93 per cent, 58 percent, 37 percent and 12 percent of the respondent farmers in that order.
4. 24 percent of them are also growing fruits including dates, mangoes and bananas.
5. 22 percent of the respondent own livestock.
6. About half (49 percent) use privately purchased seeds for wheat cultivation, 33 perecent use their own retained seed and 18 perecent use the seed purchased from Public Sector Seed Corporations.
7. On average, a farmer uses 96.73 Kg chemical fertilizer per acre with the maximum and minimum of 350 Kg and 40 Kg respectively. The average per acre cost of wheat production is Rs. 10,670.
8. All 300 farmers are using tractors for cultivation and preparing land for crops, and some are using tractors for fetching their crop produce to market.
Already, the upside of the government policy is that Pakistan's rural economy is being spurred by high crop prices that may help the GDP growth this year and next. Increased farm incomes are whetting the rural households' appetite for industrial and consumer goods in 2011 and beyond.
A key indicator of growing rural economy is the double digit increase in the sale of tractors. Millat Tractors Limited, the largest supplier of tractors in Pakistan, had record sales of 41,500 tractors in the calendar year 2010, an increase of nearly 11% over 37,537 tractors sold in 2009. Of these 41,500 tractors, a record 5000 tractors were sold in the month of Dec, 2010 alone, acording to The Nation newspaper. Millat sold 10,000 units under Benazir Tractor Scheme and 5,000 units under the Sindh government tractor scheme in the last fiscal year. Another 10,000 units were sold as part of the Punjab government scheme, 70 per cent of the units were sold, according to Dawn News.
Earlier, the sales of Fiat and Massey Ferguson tractors grew to 1,632 and 3,194 units in September 2010 from 537 and 3,100 in August 2010. The overall sales of these tractors rose to 13,931 during July-September 2010 as compared to 12,690 units in the same period of 2009, according to Dawn news.
Over 50 per cent of the motorcycles and 40-45 per cent of cars in Pakistan are purchased by people living in rural areas. Total car sales in July-September 2010(including Suzuki Bolan) rose by 12 per cent to 30,030 units as compared to 26,812 units in the same period of 2009, according to Pakistan Automotive Manufactureres Association PAMA). Furqan Punjani of Topline Securities said car sales are expected to reach 154,000 units by the end of June 2011.
In addition to rising demand for cars and tractors, there is also an upward trend in two-wheeler sales. The cumulative sales of motorcycles in July-September 2010 rose to 126,701 units from 105,862 units in the same period of 2009.
While it is good to see Pakistan's rural farm economy perk up, it is also important to recognize that the overall national economic outlook can not improve significantly unless the growing budget deficits and rising inflation are brought under control. And this will require the ruling feudal elite to pitch in by paying their fair share of income tax on their rising farm incomes. It is time for them to lead by example.
Related Links:
Haq's Musings
Pakistan's Exports and Remittances Rise to New Highs
Sugar Crisis in Pakistan
Agricultural Growth in India, Pakistan and Bangladesh
Pakistan's Rural Economic Survey
Pakistan's KSE Outperforms BRIC Exchanges in 2010
High Cost of Failure to Aid Flood Victims
Karachi Tops Mumbai in Stock Performance
India and Pakistan Contrasted in 2010
Pakistan's Decade 1999-2009
Musharraf's Economic Legacy
World Bank Report on Rural Poverty in Pakistan
USAID Report on Pakistan Food & Agriculture
Copper, Gold Deposits Worth $500 Billion at Reko Diq, Pakistan
China's Trade and Investment in South Asia
India's Twin Deficits
Pakistan's Economy 2008-2010
Comments
According to details, the total sample size was 300 respondents, five farmers were selected randomly from each village to collect their responses on the survey questions; at some villages 4 or 6 farmers were selected randomly. In district Sukkur, majority of the farmers comprise subsistence farmers as 31pc farmers of district are those who own less than 5 acres of land, while about 34pc farmers holding up to 12.5 acres of land.
Farmers, studied during survey, spend around Rs.1,611 monthly on their children education, with the maximum amount of Rs. 12,000.
Farming is a major component of the district's rural economy as almost all the respondents were engaged in farming. Wheat, rice, cotton and sugarcane are the major crops being cultivated by 93pc, 58pc, 37pc and 12pc of the respondent farmers.
Around 24pc of the respondent farmers are also cultivating fruits including dates, mangoes and bananas. Only 22pc of the respondent farmers are rearing animal (livestock).
Almost half (49pc) of the farmers used privately purchased seeds for wheat cultivation, 33pc of the farmers used their own retained seed and 18pc of the farmers used the seed purchased from Public Sector Seed Corporations.
On the average, a farmer used 96.73 Kg chemical fertilizer per acre with the maximum and minimum of 350 Kg and 40 Kg respectively. The average per acre cost of wheat production was Rs. 10,670/-, based upon the average figures of cost given by respondents of the survey.
All the respondent farmers are using tractor for cultivation and preparing land for crops and few are using tractor for fetching their crop produce to market.
Take almonds for example.
After making big investments in almonds in the past few years, California farmers are seeing their efforts pay off with predictions their recent harvest will be a record 1.65 billion pounds or more, according to Businessweek.
The big harvest comes amid strong worldwide demand and relatively high prices. Exports to China have increased eight times in the past five years, and India and Pakistan doubled their almond consumption in that time. Even with a record harvest, there's no risk California, the world's No. 1 almond producer, will saturate the market, industry experts said.
The Golden State has seen a big growth in almond orchards in the past five years as farmers shifted from less profitable vegetables to lucrative nuts. California now has 810,000 acres planted in almonds -- a 25 percent increase from a decade ago -- and produces 80 percent of the world's supply. Spain is the second-biggest producer, but its harvest is only a fraction of California's.
The state's most recent crop appeared uncertain after cold wind and rain last spring partially disrupted pollination of the trees' pink and white blooms. But recent forecasts from the U.S. Department of Agriculture predicted a record crop with at least a 17 percent increase from the previous year.
"The nut crops in general are looking good in California," said John Edstrom, who recently retired after 26 years as a Colusa County farm advisor. The market is generating "cautious optimism" among walnut, pistachio and pecan growers as well, he said.
California farmers began shifting to almonds when increases in fertilizer and other costs made it harder to make money on row crops, such as tomatoes and onions. When almond prices spiked to more than $2.80 per pound in 2006, growers leapt to plant 49,000 acres of new trees. After five years, those trees are now bearing significant fruit, contributing to the record 2010 harvest.
Improved agricultural techniques used by California's 6,000 almond growers, such as planting trees closer together, cutting back on pruning and knocking hollow shells off trees during winter to control a debilitating pest called the navel orangeworm, also have helped boost production, said Bruce Lampinen, an almond specialist at the University of California, Davis.
Farmers said they are concerned about a loss of bees with major die-offs in recent years. UC Davis apiculturist Eric Mussen said bees are still available, though they are more expensive. The cost of renting them has doubled to $150 per acre over the past five years.
Water shortages also have been a concern for some, although Almond Board chairman Mike Mason said they haven't been so bad as to affect the whole industry.
------------U.S. policymakers should note well this series of events and remember a simple lesson. Billions of dollars of U.S. assistance-and a sustained diplomatic focus on the reform agenda-have not given the United States the ability to dictate the outcomes of Pakistan's political process. This is inconvenient for the United States, but not surprising. For the United States and for other major donors in Pakistan, money has never brought leverage.
Pakistan's energy sector demonstrates the difficulty in achieving the kind of influence donor countries would like to have. For decades, the World Bank and the Asian Development Bank-armed with sums greater than the current Kerry-Lugar-Berman U.S. aid package-have urged the Government of Pakistan to finally reduce the price subsidies on electricity, to no avail. Time and again, project documents cite the same problems, the donors recommend the same solutions, the government of Pakistan promises to implement the same reform, the government breaks (and donors lament) the same promises. Meanwhile, the basic politics maintaining the status quo have not changed-there are too many reaping the benefits of subsidized power, and ordinary consumers feel they aren't getting service that warrants paying more.
When Vice President Biden visited Islamabad this week, he promised that the United States would "keep the entire commitment" of the pledged $7.5 billion in Kerry-Lugar assistance. This assurance will surely be welcomed by Pakistan, and it's a fair reflection of Pakistan's short-term and long-term importance to U.S. interests. Adjusting where and how aid is spent-including by taking the requests of the Pakistani government into account-is necessary to respond to the real needs on the ground. (On that note, we applaud the decision to put $190 million into direct smartcard grants to help Pakistani flood victims rebuild their lives). But U.S. policymakers should not expect the aid money to give the United States greater influence on economic reforms in Islamabad. This is not the point, nor the potential, of U.S. aid.
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The key point is that certain aid projects can carry both direct benefits (better services and infrastructure for the people of Pakistan) and indirect benefits (incentives for the Pakistani political system to achieve greater results with their existing resources). Here are a few examples to consider: U.S. investments in energy generation and transmission capacity can be linked to public commitments to raise electricity tariffs only when brownouts have been reduced below an announced benchmark. In this grand bargain, as service quality improves, tariffs would go up, and another round of aid investments would be delivered. In another case, U.S.-financed tools can be deployed to help Pakistani citizens hold their government accountable-with regular reports on simple indicators of development, for example, or an easily accessible database of all development projects funded from internal or external resources. Or a pilot Cash on Delivery aid contract in one or more Pakistani provinces could put levers in the hands of education reformers and help their ideas gain traction.
Arguably, the Pakistan Meteorological Department (PMD) is one of the most important reasons why the floods claimed relatively fewer lives than may have been expected, given the scale of the event. In January, I met with the Director General Arif Mahmood and his team in Islamabad. They walked me through, in painstakingly scientific detail, how their organization saved lives in 2010, as they had done before and as they will continue to do in the future.
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Some six months have passed since the onset of the floods. Surprisingly, many of the predicted disasters did not happen. Pakistan did not have the predicted second wave of deaths in the camps for the millions of internally displaced persons. Astonishingly, none of the predicted epidemics (such as cholera) took place. Pakistan has even managed to stave off the expected food insecurity.
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Pakistan's National Disaster Management Agency (NDMA), headed by Major General (Ret.) Nadeem Ahmed is part of the reason these catastrophes were prevented. The NDMA, along with the four Provincial Disaster Management Agencies, coordinated the massive effort to rescue flood victims, establish camps for internally displaced people, provide the victims with shelter, water and sanitation facilities, food and other logistical requirements. The NDMA coordinates with international donors and maintains a situation room where staff track calls and resolve problems. In a country that routinely sustains criticism for organizations that that underperform, NDMA excels.
Some of the worst fears about lost crops have not materialized. While many of Pakistan's fields have not been properly prepared for planting this year, NDMA working with its domestic and international partners was able to provide seeds to many cultivators. In many cases, they simply flung the seed into the land once the water receded. Many of these efforts are resulting in bumper crops. This was not expected in September of 2010. To be sure, this is only the beginning and much more needs to be done. But measures of this type helped stave off some of the gravest outcomes expected.
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There are still challenges. Complaints persist about corruption with the pre-paid ATM cards (Watan cards) distributed to IDPs. In Sindh, serious charges of corruption persist regarding the purchase of tents, blankets, medicines and food for the flood-affected people. Reports continue that food supplies are languishing in depots while IDPs go without in Sindh. Indeed, the IDP camp I visited in near the office of the District Coordination Officer for Dadu, was saddening. The residents and the camp administrator claimed that there had been no food distributed in a month.
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Nonetheless, half a year after the floods devastated the country and after most of the media has left the story behind, 20 million Pakistanis still need help -- and they need help now. While Pakistan must expand its own tax net to contribute to the long-term costs of rebuilding its infrastructure and preparing for future disasters, the international community should also continue to support immediate needs such as winterization, food support and rehabilitation of the flood victims.
SINGAPORE: Pakistan has resumed wheat exports for the first time in three years, selling cargoes to Bangladesh and Myanmar and more deals are likely as the nation takes advantage of rising global prices and surplus stocks at home, following last year’s bumper harvest.
The deals come as fears of global food inflation grow, with devastating floods damaging crops in Australia, forecasts of US corn inventories sliding to uncomfortable levels and dry weather hampering production in Argentina.
Asia’s third largest wheat producer, Pakistan has sold 200,000-500,000 tonnes mainly to Bangladesh and Myanmar and international traders are taking positions for more deals after Islamabad lifted a ban on overseas sales last month.
“Pakistani wheat is now competitive, they are actively selling cargoes for the last one week or 10 days,” said one trader with an international trading company in Singapore.
“Traders are taking positions in the domestic market to corner more supplies for exports.”
The benchmark US wheat and corn climbed nearly 50 per cent in 2010 on tightening supplies of grains and recent price surge have stoked worries over food inflation, already in double digits in Asia’s top consumers China and India.
On Thursday, Chicago corn rose 1 per cent to its highest in 2-1/2 years, while soybeans were steady after 4 per cent gains in the previous session, buoyed by a surprisingly steep reduction in global supply of grains and oilseeds forecast by the US government. Wheat has risen nearly 2 per cent in as many trading sessions.
Uncomfortable stocks, rising prices
US stockpiles of corn and soybeans will be drawn down to uncomfortably thin levels this year, according to a government report on Wednesday that sent grain prices soaring and added to concerns over surging world food prices.
But Pakistan decided to allow the private sector to export wheat last month, lifting a three-year ban after a bumper crop led to a market surplus.
Pakistan in August deferred earlier plans to export 2 million tonnes of surplus wheat after summer floods washed away at least 725,000 tonnes of the grain.
Traders have said that despite damages from summer floods, Pakistan still has a surplus for export after a bumper crop of 23.86 million tonnes in 2009/10 added to a carryover of 4.2 million tonnes from the previous crop.
A Karachi-based trader said Pakistan has booked orders for about 500,000 tonnes of wheat and shipments had already started.
“Our traders have made deals for about 500,000 tonnes for January-March shipment, and we expect more orders,” Javed Thara said. “Most of our wheat went to Bangladesh.”
He said Pakistan could export more than 2 million tonnes of wheat in the coming months.
Another Singapore dealer confirming the news, said deals for Pakistani wheat were signed around $350-$370 a tonne, including cost and freight. “It is 11.0 to 11.5 per cent protein content, perfect for Bangladesh and Myanmar markets,” he said.
The sowing for the next crop in Pakistan has almost completed and harvesting will begin in April. The government has set an output target of 24 million tonnes for the 2010//11 crop.
LAHORE: Pakistan is fast heading towards higher inflation and to overcome this grim scenario; improvement in governance coupled with a drastic cut in expenditure and revenue generation is crucial.
The doom and gloom scenario needs an urgent handling. Good governance, good policies, good institutions, good macroeconomic management are the drivers of economic growth that have gone dormant for quite some time. This was the crux of the speeches delivered at Economic Dialogue 2011 held at Lahore Chamber of Commerce and Industry on Tuesday. Senior economist Dr Akmal Hussain said the country is facing its gravest economic crisis in history after 1971. He said the economy is in deep recession, poverty along with high inflation is a recipe for disaster.
Unfortunately, he added, the government has zero fiscal space. He warned that Pakistan was heading towards higher inflation if immediate improvement in governance is not accompanied with cut in expenditure and substantial increase in revenue.
The former WB Executive Abid Hassan said that the institutional decay has now started taking its toll and the government should take appropriate measures on emergent basis to stop this decay. He said that with every passing day the country is going deeper and deeper into the economic mire. “Today we have reached a situation where even an economic stimulus would not work. The government should concentrate on tax collection and controlling unnecessary expenditures. Unless and until these two measures are not taken, the economy would not be able to be back on rails,” he said. The PIDE Vice Chancellor Dr Rashid Amjad said that the present day doom and gloom scenario could be changed by overcoming the acute energy shortage being witnessed by the country. The issue of circular debt needs to be taken care of by those sitting at the helm of affairs. “PSDP has a multiplier effect on the employment and economy. It should not be cut,” he said.
Former chief Economist Planning Commission Dr Pervaiz Tahir blamed the political chaos for our economic woes and termed the dictatorship democracy cycle as mother of all ills.
Energy sector expert Munawar Baseer, ex Executive committee member Almas Hyder and LCCI President Shahzad Ali Malik while appreciating the input provided by the economists said that most of the issues and challenges faced by the country are more of political. The political leadership while realizing the sensitivity of the situation should come up with a solid solution with close coordination with the chambers. “The policies are being made in isolation without the consultation of real stakeholders and that’s why the economic situation today has become more complex and directionless,” he said. The speakers said that the business community should be involved for the sake of correct decision-making.
They urged the government to evolve a more realistic and pragmatic framework by putting an end to inter-provincial disparity and the disparities within the province. The government should re-do its priority list and concentrate on the few areas that come on the top of that priority list.
It is very unfortunate, the speakers said, that the country has become the most inhospitable for both the local and the foreign investors for security reasons.
“Our inability to reach a consensus on water issue and inability to tap hydrocarbon potential of Balochistan has virtually pushed us to the wall,” they said. staff report
Reporting from Harlingen, Texas — Thousands of immigrants from India have crossed into the United States illegally at the southern tip of Texas in the last year, part of a mysterious and rapidly growing human-smuggling pipeline that is backing up court dockets, filling detention centers and triggering investigations.
The immigrants, mostly young men from poor villages, say they are fleeing religious and political persecution. More than 1,600 Indians have been caught since the influx began here early last year, while an undetermined number, perhaps thousands, are believed to have sneaked through undetected, according to U.S. border authorities.
Hundreds have been released on their own recognizance or after posting bond. They catch buses or go to local Indian-run motels before flying north for the final leg of their months-long journeys.
"It was long … dangerous, very dangerous," said one young man wearing a turban outside the bus station in the Rio Grande Valley town of Harlingen.
The Indian migration in some ways mirrors the journeys of previous waves of immigrants from far-flung places, such as China and Brazil, who have illegally crossed the U.S. border here. But the suddenness and still-undetermined cause of the Indian migration baffles many border authorities and judges.
The trend has caught the attention of anti-terrorism officials because of the pipeline's efficiency in delivering to America's doorstep large numbers of people from a troubled region. Authorities interview the immigrants, most of whom arrive with no documents, to ensure that people from neighboring Pakistan or Middle Eastern countries are not slipping through.
There is no evidence that terrorists are using the smuggling pipeline, FBI and Department of Homeland Security officials said.
The influx shows signs of accelerating: About 650 Indians were arrested in southern Texas in the last three months of 2010 alone. Indians are now the largest group of immigrants other than Latin Americans being caught at the Southwest border.
...“The country’s exports, money sent by overseas Pakistanis, balance-of-payments position and foreign exchange reserves have reflected an encouraging growth during July-December FY11, showing strong signs of improvement in the economy,” Saad-bin-Naseer, CEO of Pearl Capital, told Central Asia Online January 28. Pakistan’s exports were $10.97 billion, an increase of US $1.88 billion, in the first six months of FY11.
That 21% increase was a very positive sign for the growth of export-oriented industry and the national economy, he said.
In FY11 exports could cross the $22 billion mark for the first time because of a significant increase in the value of Pakistani products on world markets, Naseer added.
“The textile industry had taken the lead by fetching $1.28 billion in additional foreign exchange through exports,” Anisul Haq, secretary of All Pakistan Textile Mills, told Central Asia Online.“The textile industry had taken the lead by fetching $1.28 billion in additional foreign exchange through exports,” Anisul Haq, secretary of All Pakistan Textile Mills, told Central Asia Online by telephone from Lahore. “From July-December FY11 textile exports increased to $6.28 billion” compared to 2010 figures.
Total annual textile exports could exceed $13 billion for the first time, he added. In 2009-10, they totalled $10.5 billion.
“The textile industry had taken the lead by fetching $1.28 billion in additional foreign exchange through exports,” Anisul Haq, secretary of All Pakistan Textile Mills, told Central Asia Online.
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Another pillar of the economy is remittances from overseas Pakistanis. The money they sent home increased by $780m in the first half of FY11, to $5.3 billion, Haq said.
“We hope the country would receive $11 billion from overseas Pakistanis in 2010-11 with major increase in inflows from Pakistanis staying in Arab countries and other western countries,” Haq said.
Foreign aid from institutions and countries, not just individuals, helped. The disbursement of $633m in coalition support and the extension that the IMF gave the government for imposing the Reformed General Sales Tax (RGST) helped improve some of the major economic indicators, Naseer said.
The picture did much to bolster Pakistan’s balance sheet, which has had its ups and downs. Pakistan recorded a current account surplus in the first six months of the fiscal year, which enabled growth in foreign exchange reserves and stabilised the dollar-rupee exchange rate, Pearl Capital’s Naseer added.
In 2009-10, the country incurred a $2.5 billion current account deficit from July-December, but for the same period in 2010-11 it enjoyed a surplus of $26m – a dazzling switch from red ink to black, he said.
The robust performance of exports and remittances enabled Pakistan to accrue a record $17.3 billion in foreign exchange reserves by January 21, he said.
Investor confidence has grown in response to these positive indicators. The stock market capitalisation grew to $36 billion in January 2011 from $32 billion in October 2010, he said, adding that such growth would encourage foreign and local investment.
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warned.
Islamabad, which still hasn’t imposed the RGST the IMF wants, doesn’t collect enough taxes, Khan said. It levies only about 9% of GDP against the required international standard of a minimum 15% tax-to-GDP ratio, Khan said.
The government must implement tax reform, reduce reliance on borrowing from the IMF and generate its own resources to enhance tax revenues and to bolster economic growth, he added.
Serious efforts to solve chronic gas and power shortages are also imperative, he said.
KARACHI: Pakistan has a potential of at least $50 billion in value-added textile exports if human resource in this sector is fully developed, said Textile Commissioner Muhammad Idrees.
Addressing the closing ceremony of 9th round of apparel manufacturing and management training programme at the Readymade Garments Technical Training Institute, the official said that the present volume of exports was not at all satisfactory.
The stakeholders could easily double this volume by improving skills of workers and through compliance with the standards of buyers, he added.
The skills development programme comprised one-month training, which covered cutting, sewing, production management, industrial engineering and quality control. Experts and consultants from Technopak, a world renowned consultancy firm, were hired for the training.
Thirty-one master trainers or middle management professionals from Artistic Milliners, Naz Textiles, Rajby Industries and Selimpex International and Soorty Enterprises attended the ninth round of training project.
The training project has so far been successfully implemented in 30 factories in Sindh and has trained 279 master trainers/middle management professionals and 3,693 workers.
The project delivered complete training system, course curriculum, manuals and consulting guidelines to the factories. Training manuals are also translated into Urdu language to transfer appropriate knowledge and skills to workers.
Pakistan’s textile sector is optimistic about meeting the annual export target, as high cotton prices in domestic and international markets have caused an increase in prices of value-added textile products, industry people say.
The government had fixed the textile export target at $14 billion for the current fiscal year. Members of the textile sector are of the view that achieving the target is possible, as exports of highly value-added items such as knitwear and garments have increased in terms of value.
Statistics released by the Federal Bureau of Statistics (FBS) show the textile sector has performed well in the first half (July to December) of the current fiscal year, as its exports increased by 25.79 per cent as compared to the corresponding period of the previous year.
The industry, however, believes they would need to import up to five million bales of cotton because the 11 million bales produced so far in the country will not meet the requirements as some of the crop has been destroyed by flood.
The industrialists also expressed reservations about gas shortage in the country that has already caused a huge loss to the industry, particularly in Punjab. All Pakistan Textile Processing Mills Association Chairman Maqsood Ahmad Butt stressed that cotton prices reached Rs13,000 per maund (37.324 kg) and the sector may face a shortage of cotton in June if India did not lift the ban on exports.
“There is a possibility that exports will cross $14 billion target if cotton shortages are met and gas supply is restored,” he opined.
KARACHI: Engro Corporation remains unsure about Pakistan’s economic trajectory as the country battles militants and tries to contain a growing fiscal deficit, a top company official said on Tuesday.
“Nobody knows what will happen in the coming months,” said Ruhail Mohammad, Engro’s Chief Financial Officer. “I have my numbers worked out. I know where sales and profit will be. But things are changing so fast that being sure remains almost impossible.”
Political and economic events of the past six months that saw the government retreating on key reforms such as raising taxes and cutting borrowing from the central bank have left businesses without a firm outlook, he said.
Although Engro posted a 79 percent rise in yearly profit to Rs6.8 billion in 2010, it continues to face problems, he said. “The policy of gas curtailment to fertiliser-makers is unjustified. The government has given us a commitment for uninterrupted supply, especially for the new plant.”
Expansion of Engro’s flagship fertiliser plant completed last year. The corporation can now produce 2.3 million tons of urea annually.
Mohammad, who was briefing journalists a day after the announcement of corporation’s financial results, said that Engro has no problem with increase in the price of gas that is used for making fertilisers. “The government must increase the price of fertiliser. We have been saying it for the last two years,” he said. “The agricultural products such as cotton, rice and wheat have seen a substantial increase in price. Farmers have the capacity to absorb rise in cost of urea.”
He, however, said that contractual obligations must not be breached once it comes to the additional capacity of 1.3 million tons, which the corporation has recently added. “For this project, we were offered gas at concessional rates for making the investment.”
The price of feedstock gas, which is used for making fertiliser, is subsidised by the government through a controversial method of making textile and other industries pay a higher price for the fuel. This has been a bone of contention for years.
“The government will be giving Rs37 billion in subsidy on urea in 2011,” he said. “There is no justification for this at all.”
On the other hand, curtailment of gas, which is basically a raw material for fertiliser, brings down production and leaves the manufacturers with no option but to raise prices to make up for the lost sales, he said.
He said the corporation plans to list Engro Foods, Engro Energy and Fertilisers at the stock exchange this year.
Mohammad said that work on Engro Energy’s venture into mining of coal at Tharparkar, Sindh, for power generation continues. “China is showing a lot of interest in the project. Financing won’t be an issue.”
The corporation will need between $300 million and $350 million for the Thar project by the end of 2012, he said.
“We have been cited as a heavily indebted group but if you look at the books closely we generate Rs35 cash for every Rs100 of debt. I think that gives us a lot of room to easily pay off the loans.”
ISLAMABAD: Government of Pakistan has distributed Rs 28.6 billion among 1.483 million flood-affected families through NADRA’s Watan Card — each card has Rs 20000 cash assistance.
Deputy Chairman NADRA, Tariq Malik stated this while briefing the UN delegation headed by Margareta Wahlstrom, Special representative of the Secretary General for Disaster Risk Reduction who visited NADRA Headquarters today for briefing on Flood Relief System.
Tariq Malik while elaborating the overall progress said that in Punjab, 608,824 flood-hit families received Rs 11.96 billion while in Sindh 558,997 families received Rs 10.11 billion. In Baluchistan
Rs 1.85 billion have been distributed among 102,945 families and Rs 3.8 billion were disbursed among 199,414 families in the province of Khyber Pakhtunkhwa. He said in AJK and Gilgit Baltistan
Rs 188,450,000 distributed among 10,173 families and Rs 61,626,000 given to 3,263 families respectively.
He said the selection of beneficiaries is one of the most contentious aspects of any post disaster cash transfer programs in various countries. “NADRA walked extra miles as our aim was to protect the most vulnerable among the flood victims like women household, widows, special persons and minorities,” he told.
He told 120,081 Watan Cards were given to the households headed by women folks in the remotest areas of Pakistan — and 11,746 Watan Cards were given to minorities notified by the provinces.
Emphasising on Grievances Redressal System, Tariq Malik explained that 3.2 million people visited Watan Card centers, 335,044 complaints were received and NADRA has verified that 167,063 were eligible of Watan Cards of which around 155,000 have been given Watan Cards.
Fifty percent (50%) of the complaints were not genuine as these included people who already had received Watan Cards or their family member had received Watan Card. “We are not closing complaints redressal system, and would like to entertain all complaints on case to case basis,” he added.
He urged the media, international donor agencies and NGOs to focus on facts and real data, not on anecdotes or stereotypes or politically motivated press reports aiming generalisation based on isolated incidents.
Neva Khan, Country Director Oxfam, Madhavi Malagoda ARIYABANDU, Regional Programme Officer, UN International Strategy for Disaster Reduction were among the members of delegation.
Zubair Bhatti’s conference paper for the APPC Hanoi Conference shows many optimistic signs for the future of strategic philanthropy in Pakistan. Of the estimated six million Pakistanis living outside Pakistan, around 3.9 million sent home a total of US$5.5 billion from 2006 to 2007—through formal banking channels. The Ministry of Labor and Overseas Pakistanis even placed the estimated remittances at some US$8 billion—contributed by around 7 million persons “of Pakistani origin.”
And this isn’t even the good news yet. Even more positive is the observation that these remittances, and the philanthropic purposes for which they are sometimes allocated, are beginning to be “aimed at long-term social change,” showing the relative maturity of overseas Pakistanis when it comes to strategic giving. According to Bhatti: “Strategic giving is not a new phenomenon in Pakistan. Among the Muslims of the subcontinent, a proud tradition of philanthropy as an instrument of social change has long co-existed with the dominant impulse of helping the poor.” At present, more signs are pointing towards the giving public’s preference for institutional, if not strategic, methods and channels for giving. These include the following:
• The rising number of NGOs, as well as the increasing visibility of their work and their fund-raising activities;
• The proliferation of major advertisements on billboards, newspapers, and TV screens showing charitable organisations and their campaigns;
• The increasing willingness of donors to allocate their donations, including Zakat, to organisations “rather than to the poor in the family or immediate locality according to the traditional interpretation of Zakat;”
• The growing interest in corporate social responsibility among wealthy businessmen;
• American Pakistanis’ utilisation of personal foundations and funding organisations in allocating and disbursing large sums of money toward charitable causes; and
• The large percentage of funds being raised by local Pakistani NGOs from the diaspora community.
Bhatti cites several “drivers of change” in this shift toward a more strategic philanthropic perspective in Pakistan. First is the observation that overseas Pakistanis “are more educated, more aware, more affluent... than Pakistanis back home... [They] have seen the role of strategic philanthropy in [more advanced] societies.”
Next is the aging population of first-generation Pakistani emigrants and their propensity to be involved in charitable activities given their affluence, their prominence, and the amount of free time they have on their hands. Related to this is the rise in status of medical professionals who left Pakistan in the 1970s to study in medical colleges, and who now find themselves in a position “where they can use their financial resources and contacts to mobilize funds for their alma mater and other related social causes.”
As the population of Pakistani professionals in other countries matures and reaches out, so does the maturity and reach of its professional associations. Bhatti shares that, in the United States, the Association of Physicians of Pakistani Descent in North America (APNAA)—a 10,000-strong organisation—supports strategic philanthropy through health and education initiatives in rural areas. Also in the Unites States, “the growing size of remittances... represents greater opportunities for organized fund-raising.”
The BBC is reporting that "the budget deficit has reduced to 5.1% of GDP this fiscal year, down from more than 6%. The plan is to cut this to 4.6% next year".
Pakistan's budget deficit for first six months of 2010-2011 stood at 2.9%, up from 2.7% last year, according to CNBC and Reuters.
KARACHI, Feb 28 (Reuters) - Pakistan's budget deficit for the first six months of the 2010/11 fiscal year (July-June) was 2.9 percent of gross domestic product, the Finance Ministry said on its Web site (www.finance.gov.pk) on Monday. This compared with a deficit of 2.7 percent in the same period last year. In the October-December quarter, the deficit eased to 1.3 percent from 1.6 percent in the preceding quarter. Analysts said the lower second-quarter deficit was largely due to payments by the United States for logistical support provided by Pakistan in the war against Islamist militants. In November 2010, Pakistan agreed with the International Monetary Fund (IMF) that it would keep the country's budget deficit at 4.7 percent for the 2010/11 fiscal year. However, analysts agree Pakistan will likely overshoot this figure. Some forecast the deficit to be around 8 percent, higher than the central bank's prediction of between 6.0 and 6.5 percent, if fiscal reforms are not implemented. The original target of 4 percent was revised following the devastating summer floods, which caused around $10 billion in damages.
GENEVA — Pakistan's government has pushed food prices too high for an impoverished population, as malnutrition levels rise despite the recovery of crops after devastating floods, a UN food relief official said Wednesday.
Wolfgang Herbinger, director for the World Food Programme (WFP) in Pakistan, said food crops especially wheat in the southern flood-hit plains were recovering fast with the prospect of decent crops over the coming weeks.
"The crop outlook is not bad but the food security situation remains difficult because prices remain so high," he told journalists one the sidelines of humanitarian meetings in Geneva.
"The government is the biggest buyer of wheat in Pakistan they are setting the farm gate price and they dominate market," Herbinger explained.
"That's why the wheat price in Pakistan didn't adjust when, for example, in 2009 and early 2010 the wheat price had gone back a lot, it stayed high to the detriment of local consumers."
Now ordinary consumers pay double the price for wheat compared to three years ago and the food security situation has "changed dramatically," the WFP official added.
Malnutrition levels in the southern province of Sindh have reached 21 to 23 percent, according to the agency.
"That is well above African standards. The emergency standard is 15 percent," the WFP official said.
A recent survey found that in some flood-hit areas 70 percent of people were taking out loans and even using them to pay for food.
Herbinger admitted that the WFP was "struggling a bit" to bring the message across to authorities.
"You may have the country full with food but people are too poor to buy it," he explained.
"We are working a lot with the Ministry of Agriculture to explain to the minister that it is not enough to have enough production in the country if people can't afford it."
"Maybe for political reasons he doesn't always understand it, that it's one thing to be nice to the farmers but if your consumers can't afford it then... there's something wrong with agricultural policy," Herbinger added.
Massive floods caused by monsoon rains in July and August 2010 killed thousands, destroyed 1.7 million homes and damaged 5.4 million acres of arable land, experts have said.
Lowering wheat prices would create food shortages in Pakistan and encourage smuggling, officials say, responding to criticism from the UN.
On Wednesday the UN's food relief agency said the government set prices too high and malnutrition was rising.
But an official at Pakistan's food ministry told the BBC farmers would simply switch to more lucrative crops if wheat prices went down.
Devastating floods across Pakistan in 2010 damaged acres of arable land.
Although crop yields in 2011 are projected to be healthy, prices are too high for an impoverished population, the director of the UN's World Food Programme told journalists on the sidelines of humanitarian meetings in Geneva on Wednesday.
"The crop outlook is not bad but the food security situation remains difficult because prices remain so high," Wolfgang Herbinger said.
Smuggling risk
Malnutrition levels in the southern province of Sindh had reached 21% to 23%, according to the WFP.
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It is nearly impossible to stop smuggling across the Afghan border, which is extremely porous”
End Quote Food and Agriculture ministry spokesman
"That is well above African standards. The emergency standard is 15%," Mr Herbinger said.
But lowering prices would do little to help the situation, an official at the food and agriculture ministry, who wished to remain unnamed, said.
He also warned that much of the crop would end up in the hands of smugglers.
"Low farm-gate prices lead to lower acreage of wheat crop as farmers switch to other crops and it works as an incentive for smugglers seeking international prices in the neighbourhood.
"It is nearly impossible to stop smuggling across the Afghan border, which is extremely porous," he said.
So if prices are lowered, the official said, the risk is that they would eventually rise to even higher than the level they are currently set at.
In the 1990s and between 2007 and 2009 there were severe wheat shortages across Pakistan, leading to extremely high prices.
Pakistani officials also say that malnutrition in Sindh province is not a new phenomenon and is unrelated to the food supply.
"Government statistics show that food consumption has not gone down despite the doubling of food prices since 2007-08," Kaisar Bengali, advisor to Sindh's chief minister said.
A lack of public hygiene facilities and safe drinking water were more important factors in child nutrition, he said.
"These are neglected areas, and there has been hardly any development in the public health sector here in decades," Mr Bengali said.
The project will also strengthen the management of the CDPC through effective grievance redressal mechanisms and establishing control and accountability measures to ensure efficient and transparent delivery of the support.
“The 2010 floods were a disaster of historic proportions that affected over 20 million people and created a massive recovery need,” said Rachid Benmessaoud, World Bank Country Director for Pakistan. “Households faced with income shocks often adopt coping strategies that are not beneficial over time, including reducing assets and consumption, increasing borrowing, and taking children out of school to work. Therefore, cash assistance to flood-affected households is essential to mitigate the adverse effects of income shocks besides addressing the issue of poverty and vulnerability. Importantly, the project will also assist in developing necessary capacities and systems to effectively handle the similar disasters in the future.”
Launched in September 2010, the CDCP provided around 1.4 million families with cash grants of PRs. 20,000 (approximately US$230) to cover their immediate needs. The next phase, supported by this project, will provide an additional payment of PRs. 40,000 (approximately US$460) to around 1.1 million most affected households, thereby reaching between 7.5 and 8.3 million people to rebuild their lives. To meet the total financing requirements for the CDCP, the World Bank has worked closely with other development partners, some of which (USAID and Italy) have already committed funds.
“International evidence suggests that cash grants allow the recipients the flexibility of choosing where to put their resources based on their specific conditions and priorities.” said Iftikhar Malik, Co-Project Team Leader. “Beneficiaries are expected to use these additional grants to not only cover basic consumption but to also recapitalize assets as well as recover their livelihoods.”
The World Bank is well placed to support the Government of Pakistan in extending and strengthening the CDCP due to its substantial international and regional experience in protecting the affected and vulnerable through post-disaster cash transfer programs. In addition to this operation, the Bank has assisted the Government in its flood response through financing the Post-Disaster Needs Assessment and making available US$300 million for fast-disbursing financing of critical flood-related imports and US$20 million for highway reconstruction.
The credit is from the International Development Association (IDA), the World Bank’s concessionary lending arm. US$81 million of the credit carries a 0.75% service charge, 10 years of grace period and a maturity of 35 years. The remaining US$44 million has the same terms plus a fixed interest charge of 3.2%.
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Pakistan’s mineral resources – oil, gas and copper, much less gold – remain unexploited. Whatever the case, Pakistan is basically an agricultural economy. Before Partition, the area now comprising Pakistan had fed the entire India. Even now when the floods have affected the crops, Pakistan is exporting rice and wheat. And the cotton prices are so high that, together with wheat and rice prices – reinforced by global revival – it has fed the entire rural area, with unusual liquidity, so as to give a fillip to consumer demand seldom seen before!
Pakistan’s major exports consist of textile, rice, leather goods, sports goods, chemicals and carpets. More than 50 per cent of its export earnings still come from textiles – now yarn being in the forefront. Only if Pakistan focuses on agriculture in the right way can it replace the import with export economy. The current year is expected to record export of over $25 billion but, on the other hand, imports are also expected to exceed exports – $35 billion at the close of the year. The deficit finance – July-December FY10, $6.895 billion – is not any pride whatsoever. The existing situation can be remedied through exploration of mines and optimising agricultural growth and export
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In a situation like this, perhaps, the only course remains increased reliance on aid, loans and credit, which, in essence, has been worsening the economy. These loans and credits, in fact, help the economies of the developed world more than the economies of the developing countries. This is achieved through massive import – of machinery, raw materials, if not food – the PL480 of the USA – depriving the recipient countries of local investment, production and export. This has been leading to unemployment and poverty from which the developing countries traditionally suffer. The solution for the developing countries lies in reliance on education, healthcare and socio-economic infrastructure – more so in Pakistan.
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Socio-politico-economic harmony will depend, among others, on development finance through development finance institutions like PICIC and IDBP that provided long-term development finance. Now there is none. The commercial banks are doing it, but not adequately enough. It is not the job of commercial banks either. However, they are not only providing development finance of whatever worth, but all sorts of non-commercial banking – investment banking, leasing, to say nothing of asset management, and mutual funds. Jack of all trades, master of none. It is all at the cost of commercial banking, per se. The regulators may take note of it. The sooner this anomaly is rectified the better for the export orientation of the economy, and for the socio-politico-economic development of the country as a whole.
An immediately available solution is facilitating remittances, now roughly $1 billion per month and taxing the 57 per cent underground economy, under-invoicing and tax evasion, if not smuggling. The World Bank’s recent report claims this deprives the exchequer of over $500 billion annually. This will be equal to, if not, more than the aid, loans and credits which are always given at a high cost to the economy. Taxing the underground economy will reinforce localisation of investment, production and exports – glocalisation, creating employment opportunities, providing the roti, kapra aur makaan (bread, clothing and shelter) promised to the masses of people, not globalisation, which serves global interests. It will enable also much sought after access to the developed world based on outright merit.
“There’s a lot more money to be made in cotton right now,” said Ramon Vela, a farmer here in the Texas Panhandle, as he stood in a field where he grew wheat last year, its stubble now plowed under to make way for cotton. Around the first week of May, Mr. Vela, 37, will plant 1,100 acres of cotton, up from 210 acres a year ago. “The prices are the big thing,” he said. “That’s the driving force.”
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“It’s good for the farmer, but from a humanitarian perspective it’s kind of scary,” said Webb Wallace, executive director of the Cotton and Grain Producers of the Lower Rio Grande Valley. “Those people in poor countries that have a hard time affording food, they’re going to be even less able to afford it now.”
Myriad factors determine food prices. Ethanol demand has pushed up corn prices. Wheat prices rose last year when Russia banned exports after drought devastated its crop.
Farmers typically respond by increasing plantings of the most profitable crop. In the middle of the last decade, as food prices began to rise, cotton prices remained low, prompting farmers to switch from cotton to grains and other food crops. When corn prices jumped with ethanol demand in 2007, farmers grew much more corn.
This year, cotton prices are the highest they have been in years, luring farmers despite strong prices for other crops.
The United States Department of Agriculture predicted last month that southern farmers this spring would plant 12.8 million acres of upland cotton, the type that accounts for the vast majority of the crop. That is a 19 percent increase from last year, when farmers grew 10.8 million acres. It also predicted that the acreage for corn and wheat would grow, although the increases would be lower than they might have been without the competition from cotton. On Thursday, the department will release an updated forecast, based on a survey of farmers.
The effect of the cotton shift is expected to be magnified internationally, as farmers in other major cotton-producing countries, like Brazil, also respond to the high prices.
Cotton futures prices reached nearly $2.20 a pound this month on the ICE futures exchange in New York, up from $0.73 a pound last July. The price is expected to fall by harvest time, but farmers said they hoped to get close to $1 a pound.
In the United States, the economics of growing cotton vary according to many factors, including regional differences and whether or not the land is irrigated. Farmers in several southern states said that at a cotton price of about $1 a pound, their profit could be roughly $200 to $500 more per acre than they could earn growing corn or wheat. For 1,000 acres planted in cotton, that means an additional $200,000 to $500,000 profit.
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Mr. Patterson expects to plant 1,500 acres of cotton this year, up from 600 last year. He said the frenzy was so intense that even cattle ranchers were talking about growing cotton.
Farmers say they have no choice but to plant the crops that give them the best chance of making money. They face many uncertainties, and their profits can be wiped out by bad weather, rising costs for items like fertilizer, fuel or seed, or unstable crop prices, which can plummet as rapidly as they rise.
The National Cotton Council expects substantial increases in all cotton-growing states, including large jumps in North Carolina, Mississippi and Tennessee. But Texas is the nation’s biggest cotton producer, and will have by far the biggest increase in acreage.
n the last few weeks alone, it launched two more financial sector pumping operations which will harm the real economy, even as these actions juice Wall Street’s speculative humors.
First, joining the central banking cartels’ market rigging operation in support of the yen, the Fed helped bail-out carry traders from a savage short-covering squeeze. Then, green lighting the big banks for another go-round of the dividend and share-buyback scam, it handsomely rewarded options traders who had been front-running this announcement for weeks.
Indeed, this sort of action is so blatant that the Fed might as well just look for a financial vein in the vicinity of 200 West St., and proceed straight-away to mainline the trading desks located there.
In any event, the yen intervention certainly had nothing to do with the evident distress of the Japanese people. What happened is that one of the potent engines of the global carry-trade — the massive use of the yen as a zero cost funding currency — backfired violently in response to the unexpected disasters in Japan.
Accordingly, this should have been a moment of condign punishment — wiping out years of speculative gains in heavily leveraged commodity and emerging market currency and equity wagers, and putting two-way risk back into the markets for so-called risk assets.
Instead, once again, speculators were reassured that in the global financial casino operated by the world’s central bankers, the house is always there for them—this time with an exchange rate cap on what would otherwise have been a catastrophic surge in their yen funding costs.
Is it any wonder, then, that the global economy is being pummeled by one speculative tsunami after the next? Ever since the latest surge was trigged last summer by the Jackson Hole smoke signals about QE2, the violence of the price action in the risk asset flavor of late — cotton, met coal, sugar, oil, coffee, copper, rice, corn, heating oil and the rest — has been stunning, with moves of 10% a week or more.
In the face of these ripping commodity index gains, the Fed’s argument that surging food costs are due to emerging market demand growth is just plain lame. Was there a worldwide fasting ritual going on during the months just before the August QE2 signals when food prices were much lower? And haven’t the EM economies been growing at their present pace for about the last 15 years now, not just the last seven months?
Similarly, the supply side has had its floods and droughts — like always. But these don’t explain the price action, either. Take Dr. Cooper’s own price chart during the past 12 months: last March the price was $3.60 per pound — after which it plummeted to $2.80 by July, rose to $4.60 by February and revisited $4.10 per pound.
That violent round trip does not chart Mr. Market’s considered assessment of long-term trends in mining capacity or end-use industrial consumption. Instead, it reflects central bank triggered speculative tides which begin on the futures exchanges and ripple out through inventory stocking and de-stocking actions all around the world — even reaching the speculative copper hoards maintained by Chinese pig farmers and the vandals who strip-mine copper from the abandoned tract homes in Phoenix.
The short-covering panic in the yen forex markets following Japan’s intervention, and the subsequent panicked response by the central banks, wasn’t just a low frequency outlier — the equivalent of an 8.9 event on the financial Richter scale. Rather, it is the predictable result of the lunatic ZIRP monetary policy which has been pursued by the Bank of Japan for more than a decade now--and with the Fed, BOE and ECB not far behind.
Islamabad/Rome, 30 Mar 2011 -- A large-scale distribution by FAO of wheat seeds to the victims of last year’s floods in Pakistan is now ripe to yield enough food for half a million poor rural households.
With an average family size of eight, this translates into a harvest large enough to feed four million people for the next six months.
FAO spent $54 million of international donor funding buying and distributing quality wheat seeds as part of its emergency intervention that began last August. . Once the harvest is completed, this donation will have produced a crop worth almost $190 million in wheat flour, the main staple, at current local retail prices. “The investment made by donors has been quadrupled,” said Daniele Donati, Chief, FAO Emergency Operations Service. “Moreover, farmers will be able to save the seeds from this year’s harvest to plant again later this year.”
More than 18 million people in Pakistan were affected by last summer’s severe flooding, which caused extensive damage to housing, infrastructure and crops.
Farming nearly fully-funded
In responding to the immediate and critical challenges of the 2010 floods, FAO led the Agriculture Cluster, comprised over 200 organizations, reaching 1.4 million farming families across Pakistan.
FAO received $92 million of its $107 million appeal, which has enabled it to shore up the smallholder agricultural system in the four Pakistan provinces affected by the flooding. The donors were Australia, Belgium, Canada, CERF, the European Commission, IFAD, Italy, Sweden, the United Kingdom and the United States of America.
As well as supporting the “Rabi” wheat planting season, it is estimated that FAO saved the lives of almost a million livestock by supplying temporary shelter and enough de-worming tablets and dry animal feed for almost 290,000 families. Green fodder is now becoming available as the harsh Pakistan winter turns to Spring.
“The livestock interventions really paid off,” Donati said. “It costs ten times more to buy a new animal, which often represent a family’s lifetime savings”.
Canals cleared
FAO is overseeing a thousand cash-for-work schemes by which workers are paid to clear irrigation canals blocked with silt and flood debris.
One severely affected province not to have received much help is Sindh. This was because the fields remained waterlogged until well after the end of the Rabi planting season, and in some cases are still inundated. The UN Agency will shortly distribute quality rice seeds to almost 25 000 families in Sindh for the upcoming planning season, but over 700 000 families will require assistance over the coming months.
Recovery priorities
FAO, in partnership with the Government of Pakistan has identified recovery priorities for the next two years. These are increasing crop, livestock, fishery and agro-forestry production, improving diets and nutrition and boosting agriculture extension services to offer advice to landless and smallholder farmers.
“Pursuit of these core objectives will significantly reduce the vulnerability of the populations in question, improve food production and income generation, and increase affected communities’ resilience to future shocks,” said Donati. FAO expects its recovery programme to cost $94 million, enough to assist 430 000 families in 24 districts.
An Early Recovery Working Group, co-chaired by the Pakistan Government’s National Disaster Management Authority and the United Nations Development Programme, has been set up with eight sectors covered including one on Agriculture and Food Security, co-chaired by FAO, WFP and the Ministry of Food and Agriculture.
“We are looking at a growth rate of four percent for the next year because of a good services sector and on the hope of better farm output,” said a Finance Ministry official who did not want to be identified.
The figure compares with a 3.7 percent growth forecast by the Asian Development Bank (ADB) in its Outlook 2011 report released on Wednesday.
The ADB expects persistent energy problems and security issues will continue to check Pakistan’s growth in 2011/12, with surging inflation posing a further major risk.
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Last year, the worst-ever floods that hit the country inflicted $10 billion in losses, forcing officials to slash growth estimates in between 2.5-3 percent for the current year, down from an expected 4.5 percent.
The services sector, however, is likely to grow by four percent in the current year to June and there are signs that the farm sector is recovering from the flooding.
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Higher cotton, rice and sugar output is expected in the coming year, analysts said.
“We expect that 2011/12 will be much better than this year ... Our own (growth) forecast is close to 4.5 percent,” said Sayem Ali, an economist at the Standard Chartered Bank.
An official at the Planning Commission, which prepares growth targets, also spoke of likely four percent growth next year, but said that was contingent on continuing support from remittances from Pakistanis working abroad and on exports, which have grown by 20-25 percent during the first eight months of the current financial year.
However, the large-scale manufacturing sector, which dominates the overall industry making up 12.2 percent of Pakistan’s GDP, remains a major concern as it faces chronic energy shortages and high interest rates that discourage private sector borrowing.
The sector grew 1.03 percent up to January, against 2.34 percent during the corresponding period last year.
“Energy shortfalls are lowering real growth by at least two percentage points annually,” the ADB said in its report.
Improved prospects for Pakistan’s economy, however, will largely depend on the implementation of measures to address key problems such as inflation, the budget deficit and the need for transparent revenue policies, according to the ADB.
“Increasing prices are on the warning level, not just for Pakistan, but for the whole region,” said Rune Stroem, ADB’s Pakistan country director.
The ADB forecasts inflation in Pakistan will quicken to 16 percent in 2011, the highest in Asia. Revenue generation is another grey area.
The central bank chief said this week that quick steps were needed to broaden the tax base in Pakistan, which has one of the lowest tax-to-GDP ratios in the world, currently around 10 percent.
The IMF has not yet released the latest tranche of the $11 billion loan due in May last year because of the government’s inability to implement a reformed general sales tax, seen as a key to expanding the tax base.
The fiscal deficit, meanwhile, is expected in between 5.3 percent and 5.5 percent of the GDP in 2010/11, but could be higher if some external flows, including grants, are not received soon.
Stroem said that 5.5 percent deficit estimates seemed unrealistic and there are signals that these might slip even further.
GLORIOUS countryside lies between Rahim Yar Khan and Bahawalpur. Travelling across six districts in Punjab, before a blazing summer sets in, I experienced endless fields of wheat waiting to turn golden, of freshly harvested mustard, acres of ripe sugarcane and sprawling mango orchards.
Far from the drudge and gloom of metropolitan Pakistan, economic privation, traffic snarls, extreme religion and the cricket World Cup agony, this is another Pakistan. Over a quarter of a century after the green revolution ended the rural economy is back in boom, this time on the back of rising prices. The feel-good factor is all around.
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Alongside the cash economy, the place is also brimming with ideas, and with an entrepreneurial spirit. A young man I meet at Rahim Yar Khan’s chamber of commerce has an IT degree and owns an ice cream distribution business spawning an elaborate cold chain across three districts. He tells me that sales are surging because rural society is transitioning to modern desserts which are now more affordable than traditional sweets like mithai and khoya.
Meanwhile, he’s toying with the bigger vision of an electronic marketplace for agricultural produce. Live connectivity to grain mandis and markets for fresh produce and milk will empower farmers to obtain prices online and through their cellphones. He wants to materialise this and wants tips. I give him my two cents worth: study similar models, write a concept paper, galvanise partners around it, put in seed money and get the venture to mezzanine level.
For now the agricultural economy is growing more in value than in volume. As it does, it pulls in a rising demand for inputs. Fertiliser and agrochemical companies, some listed on the stock exchange are making record profits. Still, few find time to complain about rising input prices. With a population of 400,000, Rahim Yar Khan sports showrooms displaying cars, motorcycles and generators, fast food outlets and even private healthcare clinics.
Even then, not all the cash would appear to go into consumption. Pakistan now ranks amongst the world’s top 10 markets for tractors. Alongside, and despite constrained credit to agriculture, farmers are investing in agricultural implements, irrigation channels and farm modernisation.
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“Simple”, he explains, “this year the ginners got together with the local utility company, Mepco. We’ve instituted a system whereby instead of intermittent hours of loadshedding we get it in one block of 12 hours. This way we can run the factory on one shift per day”. With that problem behind him he now wanted to move on; that is, to a pasteurised milk business.
As the green revolution tapered off, a poultry revolution began; in the late 1970s. Ever since, Pakistan has been gnawing away
at broiler chicken and there’s no turning back. Today a dairy revolution is sweeping Pakistan. As the world’s fifth largest milk producer, the country can only process three per cent of its milk production. Sitting in his factory office in Khanpur — one could have been in any plush office in a metropolis — we open his wireless notebook and download a pre-feasibility study for a milk pasteurising business from Smeda’s website. We glean through it, and at a Rs160m capital outlay it looks doable for him.
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In 2009, an NGO distributed young cattle on micro-credit to 1,000 small farmers and built an apex organisation to collect and market milk from these grass-roots. The Dutch consultant for the NGO informs me that a modern farmers’ cooperative model is now evolving. Such models have long been in vogue in Europe and indeed in several developing countries. Usually the extended supply chain ends at farmer-owned retail outlets — co-ops. Why hasn’t this concept gained traction in Pakistan?
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And so Pakistan prepares to harvest another bumper wheat crop in 2011.
KARACHI: After a year of unemployment and wondering if his family would be better off if he died, Pakistani textile worker Murad Ali has got the spring back in his step.
One of thousands laid off by textile bosses last year, the father of four is now back at work and one of those to benefit from a surge in Pakistani exports in the current fiscal year, which ends on June 30.
Experts say rising global commodity prices, a government decision to prioritise power supply to industry and currency devaluation that has made Pakistani products more competitive, have fired an export boom.
Compared with the same period last year, the Trade Development Authority of Pakistan says textile exports such as silk rose 25.8 per cent and agricultural produce, such as basmati, rose 6.2 per cent from July to February 7, 2011.
The textiles sector is one of the key drivers of the Pakistani economy, accounting for 55 per cent of all exports and 38 per cent of the workforce, according to official figures.
Bosses have rehired staff who were laid off, but Ali is only getting a third of the salary as a skilled garment worker that he used to command.
“I’m earning less than last year. It is difficult to live a better life due to price rises, but I’m happy,” Ali said.
He has re-enrolled his sons at school but his wife will continue to work as a maid. Money is too tight for her to go back to being a housewife.
“The situation has drastically changed in the favour of the country’s economy,” said textile tycoon Mirza Ikhtiar Baig, who employs more than 2,000 workers and predicts exports will rise 10 per cent for the fiscal year 2010 to 2011.
“Now with demand for Pakistani products rising internationally we are employing more workers.
“Our exports are getting healthier because of an increase in international commodity prices and the government’s will to give top priority to the country’s economy,” said Baig, an advisor to Prime Minister Yousuf Raza Gilani.
The Asian Development Bank forecasts GDP growth for Pakistan of 2.5 per cent for fiscal year 2011 despite pressures from unprecedented floods in 2010, with a relatively modest rebound to 3.7 per cent for fiscal year 2012.
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Pakistan suffers from a profound electricity crisis that restricts production to around 80 per cent of its needs — a situation that will only worsen as the temperatures crawl higher in the coming months.
The budget deficit has grown to 5.5 per cent of GDP, above a 4.9 per cent target for the current fiscal year to June 30.
To fund the shortfall, the government borrowed $4.4 billion from the central bank from July 1 to February 28, a move that worsened inflation, rather than raise taxes and cut spending as the IMF and World Bank would like.
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Mohammad Sohail, head of the Karachi-based Topline Securities research and brokerage house, said the export boom would contribute to economic recovery, yet warned the gains were minimal.
“It is very fragile because the fiscal deficit is much higher than the target of 5.3 per cent because of the government’s heavy borrowing from the central bank,” he said.
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“Furthermore, the overall security situation in Pakistan is very uncertain, which is making the foreigners and local investors wary all the time.” Independent economist A.B. Shahid said rising international oil prices had hit the country’s economy hard, adding $4 billion to the oil bill.
Pakistan could have benefited more from 8-9 per cent export growth, he said, by exporting cloth in its value-added forms rather than raw cotton and yarn.
While Ali is content with life, he is also wary of uncertainties ahead.
“Life has become too insecure. Everyone is ill at ease. Let’s just wait and see.” – AFP
MUZAFFARGARH, 8 April 2011 (IRIN) - Eight months after floods forced Saleemullah Adeel and his family to abandon their home in Pakistan’s southern Punjab city of Muzaffargarh, the road to recovery has proved rough for this landless farmer.
The wheat he planted on 10 acres (four hectares) leased from a large landowner at an annual fee of US$118 per acre (0.4 hectares) is doing well, and Saleemullah hopes for a good crop because weather conditions so far have been good. Near his house, which is now partially repaired, there are neat rows of vegetables, and a few hens feed in the yard. But he has little else to be happy about.
“I bought wheat seed and fertilizer after selling the jewellery we had purchased for my elder daughter’s wedding, which was scheduled for this month,” Saleemullah told IRIN. “Now it has been postponed [yet] I have used up all my savings and my two sons, who worked on fish farms, have lost their jobs.”
The July-September 2010 floods destroyed hundreds of fish farms in the Muzaffargarh area, according to media reports, leaving many, like Saleemullah’s sons, out of work.
But Saleemullah’s problems do not end here. Since he did not own the land he farmed, he was not awarded compensation by the provincial government, which gave landowners seed and fertilizer. “The landlord we lease from claimed he needed [the seed and fertilizer] for his own lands,” he said.
Cotton crop destroyed
Other people, too, have suffered. “I have earned nothing for months because the cotton crop was destroyed, and factories which crush the cotton seed to extract oil did not employ us this time as they usually do,” said Ahsan Akhtar, 30, whose wife was not hired this year as a cotton-picker.
Across the country, people have continued to live with losses incurred during the floods, even as they attempt to recover, but this is proving tough. “My youngest child, aged six months, has had diarrhoea for nearly a month,” said Sanober Bibi, 25. “The health workers who used to visit early on after the floods no longer come, and the medicine given by the local midwife did him no good at all.” There is no clinic in their village.
On 6 April Neva Khan, country director of the UK Charity Oxfam, pointed fingers at the government, telling reporters that a delay on the part of the government to provide a “reconstruction strategy” had resulted in delays in urgent rebuilding and recovery work. In some cases this had “barely started even eight months after the disaster”, he said.
A government official refuted that claim. "The rehabilitation phase was started some months ago," Ahmed Kamal, spokesman for the National Disaster Management Authority, told IRIN. A Sindh government official, who preferred anonymity, said a "desperate lack of funds" was holding up recovery in the province, but "progress was slowly being made".
..Is the current spike in the commodity prices benefiting everyone living in the villages, particularly in Punjab and Sindh which together contribute more than 90 per cent to the country’s agricultural output and where more than two-thirds of the country’s population lives?
“Whereas a large chunk of this income has ended up with the agriculture elite, there are signs that some of it has trickled down to the small farmers as well,” according to Waheed. Others argue that the transfer of additional cash has widened income disparity in the rural society even if many small farmers have also benefited from the soaring crop prices because the “trickle-down” has been uneven and limited.
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Ashfaque Hasan Khan, dean and principal of the NUST Business School who served as a special finance secretary in Musharraf government, says the income disparity in the rural areas has widened as a result of the rising crop prices.
“Only 40 per cent of the rural population is engaged in the crop sector and a vast majority of them are small landholders. This means only a small portion of population in the rural areas has gained from the increasing crop prices,” he elaborates.
In Punjab, for example, less than half of the rural population is engaged in the crop sector. Some 90 per cent of it falls in the category of small farmers with landholdings up to 12.5 acres.--------
“An overwhelming majority of small farmers buys inputs on credit and, thus, is forced to pay a much higher price than those who pay cash for these inputs,” claims Mughal. “Even if they have cash their cost has gone up manifold, offsetting the gains of
higher crop prices.”
There are people who are of the view that smaller landholding have helped a more equitable distribution of additional incomes among the growers in Punjab compared to the farmers in Sindh where landholdings are very large.
Salman Shah, former finance minister, says the additional incomes generated by higher commodity prices have been distributed more evenly in Punjab compared to Sindh.
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Shah is of the opinion that the landless labour in the villages has also benefitted from the new economic prosperity being experienced in rural areas and their wages have also gone up. But he says only a comprehensive study of the impact of commodity prices on the rural society could give answers to many questions.
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Many fear that the growing agricultural commodity prices may rob the farmers of the incentive to boost their productivity. Mughal says the rising prices and decreasing productivity is not good for the economy.
“Our productivity per acre has decreased significantly over the decades whereas India has successfully managed to substantially boost its crop output. The new wave of economic prosperity in the rural areas should not be allowed to take our focus off the need to boost productivity. That will be disastrous for the economy as well as people,” he warns.
While the soaring prices have brought a semblance of prosperity to the rural areas, it has added to woes of the urban population where poverty levels are rising and the quality of life suffering. The Consumer Price Index (CPI) has increased by 55 per cent over the last three years whereas salaries have not risen accordingly, according to Waheed.
“The urban population that relies on manufacturing growth and trading, or earns fixed salaries has generally experienced a deterioration in its standard of living, and is not happy about it. Large scale manufacturing growth has declined by about one per cent over the last three years whereas the wholesale trade has risen by a marginal four per cent,” he says, underlining the impact of rising price inflation on the urban consumers
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Despite recent good macroeconomic performance, Pakistan continues to have high levels of poverty. Poverty estimates of 2000-2001, indicate that around one third of the population lives at or below the poverty line, with poverty being concentrated in rural areas. Available international literature indicates a strong and clear-cut relationship between agricultural growth and poverty reduction. The agricultural sector is a major determinant of the overall economic growth and well being in Pakistan, contributing 23 percent of total GDP; employing 42% of the total employed labor force; and accounting for nearly 9 percent of the country's export earnings. Thus, high agricultural growth is essential for significant poverty reduction in Pakistan.
However, in addition to the direct impact of agriculture growth on poverty reduction, there is also a much larger indirect effect through the linkages between agriculture and non-farm growth in rural areas. Non-farm growth is closely linked with agricultural growth since peasant farmers spend a large portion of their incremental income on locally produced non-agricultural goods thus generating employment and incomes in the adjoining areas. The increased demand for non-farm goods leads to a much larger increase in employment, which is a key vehicle for poverty reduction. Available information also points to the increasing importance of non-farm incomes for rural households. The five major sources of income in rural Pakistan are wages/salaries, transfer income, crop income, rental income and livestock income. Livestock is a particularly important source of income for the poor with a majority of poor households, especially the landless and small landowners, dependent on this sector.
In the light of increasingly limited income generating opportunities in the on-farm sector, poor households are increasingly turning to the non-farm sector as a key source of livelihood. In addition, there appears to be a higher incidence of vulnerability to falling into and remaining in poverty, among households which are dependent solely on agriculture. Rural areas that are well connected with the urban areas seem to be more prosperous, in part because the lack of employment opportunities in rural areas results either in labor reallocation or migration. In both cases, human capital plays a positive and significant role and the poorest of the poor neither possess the human capital nor have the resources to migrate. This vulnerable group needs special attention.
Pakistan's Poverty Reduction Strategy Paper outlines four pillars for accelerating growth and reducing poverty. Pillar One focuses on accelerating economic growth, pillar Two on improving governance and devolution, Pillar Three on investing in human capital, and Pillar Four on targeting the poor and vulnerable. Pillars One and Four focus on generating employment, especially in the rural areas, small and medium industries and micro-finance. There are also very strong linkages between income poverty and the other two PRSP Pillars. For example, access to justice, successful devolution, increasing the human capital of the poor, and ensuring effective safety nets are also central factors for increasing the incomes of poor people.
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To increase incomes of poor households and build social capital, the ADB is funding a Micro-Finance Sector Development Program. As part of its objective to efficiently provide financial and social services to the poor, the ADB assisted with the establishment of the Khushali Bank, a public-private enterprise in partnership with NGOs, under this program. The ADB is also engaged in several rural development projects such as the Malakand, Federally Administered Tribal Areas, Bahawalpur, and Dera Ghazi Khan Rural Development Projects, to enhance household incomes, particularly for the smallholder and tenant farmers, and the landless.....
The Mahatma Gandhi National Rural Employment Guarantee Scheme (NREGA), as the $9 billion program is known, is riddled with corruption, according to senior government officials. Less than half of the projects begun since 2006—including new roads and irrigation systems—have been completed. Workers say they're frequently not paid in full or forced to pay bribes to get jobs, and aren't learning any new skills that could improve their long-term prospects and break the cycle of poverty.
In Nakrasar, a collection of villages in the dusty western state of Rajasthan, 19 unfinished projects for catching rain and raising the water table are all there is to show for a year's worth of work and $77,000 in program funds. No major roads have been built, no new homes, schools or hospitals or any infrastructure to speak of.
At one site on a recent afternoon, around 200 workers sat idly around a bone-dry pit. "What's the big benefit?" said Gopal Ram Jat, a 40-year-old farmer in a white cotton head scarf. He says he has earned enough money through the program—about $200 in a year—to buy some extra food for his family, but not much else. "No public assets were made of any significance."
Scenes like this stand in stark contrast to India's image of a global capitalist powerhouse with surging growth and a liberalized economy. When it comes to combating rural poverty, the country looks more like a throwback to the India of old: a socialist-inspired state founded on Gandhian ideals of noble peasantry, self-sufficiency and a distaste for free enterprise.
Workers in the rural employment program aren't allowed to use machines, for example, and have to dig instead with pick axes and shovels. The idea is to create as many jobs as possible for unskilled workers. But in practice, say critics, it means no one learns new skills, only basic projects get completed and the poor stay poor—dependent on government checks.
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Others said the ban on mechanization limits the scope of projects to gravel roads and pits to capture water. Such programs last for only a couple of years and do little to improve village life. Balveer Singh Meena, a 31-year old farmer in the village of Mohanpura in northern Karauli, ekes out a living growing wheat and chickpeas. He eats a single Indian flat-bread known as roti and vegetables for every meal. By selling what little excess food they produce, Mr. Meena and his three brothers are able to make just over $400 per year, which must stretch to pay for an extended family of eight people.
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But shortly after the program started in February 2006, workers complained that local leaders were docking pay and asking for money in return for job cards. The central government responded in 2008 by sending money directly to workers' bank accounts. But according to workers and auditors, the money takes so long to reach those accounts—up to 45 days—that workers are often forced to accept lesser cash payments from local leaders on the condition that they repay the money at the full amount.
Audits of the program in the southern state of Andhra Pradesh found that about $125 million, or about 5% of the $2.5 billion spent since 2006, has been misappropriated. Some 38,000 local officials were implicated, and almost 10,000 staff lost their jobs.
In one study of eastern Orissa state, only 60% of households said a member had done any of the work reported on their behalf. Earlier this month, the central government gave the green-light for the Central Bureau of Investigation, India's top federal criminal investigation body, to launch a probe into alleged misuse of program funds in Orissa....
ISLAMABAD — Pakistan is defying mounting Western pressure to end a giant tax dodge with fewer and fewer people contributing to government coffers, spelling dire consequences for a sagging economy.
Tax is taboo in Pakistan. Barely one percent of the population pays at all, as a corrupt bureaucracy safeguards entrenched interests and guards private wealth, but starves energy, health and education of desperately needed funds.
Less than 10 percent of GDP comes from tax revenue -- one of the lowest global rates and worse than in much of Africa, say economists.
Federal Board of Revenue (FBR) spokesman Asrar Rauf said 1.9 million people paid tax in 2010, less than the year before, despite 3.2 million being registered to pay -- itself a drop in the ocean of a population of 180 million.
As a result, Pakistan's fiscal deficit widened from 5.3 percent to 6.3 percent of GDP in 2010, the Asian Development Bank said this month, knocking 2011 growth figures to 2.5 percent and predictions for 2012 to 3.2 percent.
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This month visiting British Prime Minister David Cameron pressed the point home, saying aid increases were a hard sell when: "Too many of your richest people are getting away without paying much tax at all and that's not fair".
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The IMF last May halted a $11.3 billion assistance package over a lack of progress on reforms, principally on tax.
And despite a flurry of meetings, no new loan has been agreed in the run-up to the IMF and World Bank's Spring meetings.
An IMF review mission is due to visit on May 8. "Consensus is building, we have almost reached agreement (on reform)," one government official told AFP, but gave no details.
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What would really work, say analysts, would be scrapping exemptions that serve entrenched interests, such as a 50 percent tax discount on sugar and a gate on taxing agricultural income that largely exempts wealthy feudal landowners.
But stalemate and vested interests have made that impossible.
"There's talk of early elections. One has a brittle coalition. A lot of the reform areas that need to be dealt with have very well entrenched and powerful lobbies that are making the case against it," said a finance ministry official.
As it is, the tiny minority who contribute say they carry a disproportionate tax burden, for which they get nothing in return.
Pakistan suffers from an awful energy crisis, yet government spending on electricity subsidies last year reached just under one percent of GDP, health spending 0.5 percent and education two percent, said the finance ministry.
According to a 2009 study by the Pakistan Institute of Legislative Development and Transparency, the average member of parliament was worth $900,000 and the wealthiest $37 million.
Those figures stand against estimates that a quarter of the population lives below the poverty line and that GDP per capita stands at $2,400.
"No one trusts the government," says industrialist Mohammad Ishaq, former vice president of the chamber of commerce in the northwestern province of Khyber Pakhtunkhwa.
"Without social welfare and with this corruption, nobody is ready to pay tax... in return one gets nothing -- no health, education, social security."
Eunuchs have been appointed tax collectors in Karachi, the financial capital, on the understanding that a visit from the maligned transgender group would embarrass people into paying up.
But former finance minister Salman Shah said tax evasion was inevitable because of corruption within the FBR, which employs 23,000 people nationwide.
"There's a big mistrust of the tax authority itself. That's why a self-assessment scheme came in," said Shah.
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1 Dairy Sector
With an estimated 33 billion litres of annual milk production from 50 million animals, managed by
over 8 million farming households, Pakistan is the 5th largest milk producing country in the world
Livestock sector contributed approximately 53.2 percent of the agriculture value added and 11.4
percent to national GDP during 2009 – 10
The milk economy in terms of value is over 27% of the total Agriculture sector
Additional potential of 3 billion litres of milk, with a growth rate faster than any other sector
Of the total 33 billion litres of milk produced, 71% is rural based and 29% is urban based
Of the total production, around 3% is processed and marketed through formal channels
40% Supply and Demand gap exists in Pakistan.
2 Livestock Sector
Livestock sector contributed approximately 53.2 percent of the agriculture value added and 11.4
percent to national GDP during 2009?10.
Gross value addition of livestock at current factor cost has increased from Rs. 1304.6 billion
(2008?09) to Rs. 1537.5 billion (2009?10) showing an increase of 17.8 percent as compared to the
previous year.
The population growth, increase in per capita income and export revenue is fuelling the demand for
livestock and livestock products.
Pakistan earned USD717 million from leather exports in FY09 and a meagre USD96 million from meat
exports.
Poultry sector is one of the organized and vibrant segments of agriculture industry of Pakistan.
This sector generates employment (direct/indirect) and income for about 1.5 million people.
Poultry meat contributes 23.8 percent of the total meat production in the country
The meat demand for Pakistan Domestic market is growing at a rate of 2.73% for Beef, 2.90 % for
mutton and 6.10 % for poultry.
This domestic demand is growing to meet the population growth, human need for protein and
calcium, migration of population from rural to urban and the fluctuating growth due to per capita rise
in income.
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3 Fisheries Sector
During the period July?March 2009?10 the total marine and inland fish production was estimated
952,735 Million tons out which 667,762 Million tons were marine production and the remaining catch
come from inland waters.
A number of sites have been earmarked on an area of 20,000 acres of land in Districts Thatta &
Badin along the coast.
Immense potential exists to start commercial scale fish/shrimp farming in Sindh.
4 Poultry Sector
Poultry is an important sub – sector of agriculture and has contributed enormously to food production by
playing a vital role in the domestic economy.
Poultry industry can broadly be divided into three
groups, viz. hatchery, poultry farming and feed sectors. This sector generates employment and income
for about 1.5 million people in Pakistan. Its contribution in agriculture growth is 4.81% and in Livestock
growth is 9.84%, whereas, the total poultry meat contributes to 23.8% of the total meat production in
the country.
Pakistan, with a population of 170 Million people, has gone through a sizeable growth in the production
of poultry meat and eggs. Per capita availability went up from 23 in 1991 to 46 eggs in 2009 and poultry
meat availability increased from 1.48kg to 2.88 kg during the same period. In our Country per capita
consumption of meat is only 7 KG and 60-65 eggs annually. Whereas developed world is consuming 41
KG meat and over 300 Eggs per capita per year. According to Industry sources there is capacity of 5,000
Environmental Control Houses in Pakistan and currently only 2,500 houses are working.
The total Poultry population in Pakistan is approximately 610 Million.
The prices of staple foods will more than double in 20 years unless world leaders take action to reform the global food system, Oxfam has warned.
By 2030, the average cost of key crops will increase by between 120% and 180%, the charity forecasts.
Half of that increase will be caused by climate change, Oxfam predicts, in its report Growing a Better Future.
It calls on world leaders to improve regulation of food markets and invest in a global climate fund.
"The food system must be overhauled if we are to overcome the increasingly pressing challenges of climate change, spiralling food prices and the scarcity of land, water and energy," said Barbara Stocking, Oxfam's chief executive.
Women and children
In its report, Oxfam highlights four "food insecurity hotspots", areas which are already struggling to feed their citizens.
* in Guatemala, 865,000 people are at risk of food insecurity, due to a lack of state investment in smallholder farmers, who are highly dependent on imported food, the charity says.
* in India, people spend more than twice the proportion of their income on food than UK residents - paying the equivalent of £10 for a litre of milk and £6 for a kilo of rice.
* in Azerbaijan, wheat production fell 33% last year due to poor weather, forcing the country to import grains from Russia and Kazakhstan. Food prices were 20% higher in December 2010 than the same month in 2009.
* in East Africa, eight million people currently face chronic food shortages due to drought, with women and children among the hardest hit.
The World Bank has also warned that rising food prices are pushing millions of people into extreme poverty.
In April, it said food prices were 36% above levels of a year ago, driven by problems in the Middle East and North Africa.
Oxfam wants nations to agree new rules to govern food markets, to ensure the poor do not go hungry.
It said world leaders must:
* increase transparency in commodities markets and regulate futures markets
* scale up food reserves
* end policies promoting biofuels
* invest in smallholder farmers, especially women
"We are sleepwalking towards an avoidable age of crisis," said Ms Stocking.
"One in seven people on the planet go hungry every day despite the fact that the world is capable of feeding everyone."
Among the many factors driving rising food prices in the coming decades, Oxfam predicts that climate change will have the most serious impact.
Ahead of the UN climate summit in South Africa in December, it calls on world leaders to launch a global climate fund, "so that people can protect themselves from the impacts of climate change and are better equipped to grow the food they need".
The government has imposed a 10 per cent advance tax on commission, or brokerage fee, earned by the agents of cultivators or farmers and a withholding tax at a rate of 1.5 per cent on the sale of cotton seed, rice and edible oils.
According to new taxation measures announced by the government on Saturday, the new taxes will not be applicable to growers who sell their produce, a circular of the Federal Board of Revenue (FBR) said.
The circular stated that the withholding tax on sale/purchase of seed cotton will be deducted by withholding agents.
“The withholding agent shall not deduct withholding tax on purchase of agriculture produce which is directly sold by a grower of the produce,” the circular added.
The 1.5 per cent withholding tax is being levied on profits earned by the middlemen in the business of buying produce and selling it to the markets at higher rates.
To ensure that the withholding tax is collected, the FBR has directed that the buying agent will have to make three copies of the certificate and give one to the grower, submit the second copy in office of tax commissioner of Inland Revenue and keep the third copy for own record.._
The FBR has also issued a format for the farmers, describing their sale of sugarcane, wheat, rice or cotton to the buyer, which also explains the details of the agricultural land the produce belongs to and the date of sale.
While the circular also states that “in case sale of seed cotton or other agriculture produce is made by a grower/cultivator through a commission agent, then advance tax is collectible under section 123 of the Ordinance at rate of 10 per cent of the gross commission income of the commission agent”.
However, the farmers have rejected the new initiative of the FBR and the farmers’ associations have come up with plans to organise a demonstration in Multan on April 5.
Agriculturists have been accusing the government of adopting policies that would only hurt the small- and mid-level farmers and these measures are being taken to protect the large land owners who should be paying income tax on agriculture.
Calling the new measures as indirect tax on the agricultural sector, the President of Pakistan Agriculture Forum Ibrahim Mughal talking to Dawn said the government was bent upon destroying all the productive sectors and after imposing 17 per cent General Sales Tax on agriculture inputs including pesticides, fertiliser and tractors through presidential ordinance on March 15, 2011, the new move will have more serious impact on the overall agriculture economy.
Mr Mughal said that new measures would affect the overall agricultural sector and its productivity which would reverse economic cycle for the small and mid-level growers.
“In March government imposed over Rs80 billion taxes on agriculture sector in form of GST and advance taxes,” he said adding that around 80,000 tractors are being purchased by the growers per annum and after the imposition of 17 per cent sales tax, they will have to pay a total of Rs8 billion annually more than the earlier price.
KARACHI: Pak Suzuki Motor Company (PSMC) stands to gain from the Yellow Cab Scheme announced by the government of Punjab in its budget for 2011/12, analysts said.
The provincial government has announced that a grant of Rs4.50 billion has been allocated for the scheme, which will partly finance 20,000 vehicles.
Contrary to the yellow cab scheme, the Nawaz Sharif government introduced in 1992/93, this scheme relies on locally-made vehicles.
‘Mehran’ and ‘Bolan’, the two most popular makes of Pak Suzuki, have been short-listed for the scheme.
The analysts said the ultimate beneficiary will be the PSMC, which has been suffering from appreciating yen, relaxation in import policy and production constraints since a tsunami-hit Japan.
Gross profit margin of the company has squeezed to mere two percent in 2010, which was around four percent a year back, they added.
Details of the scheme are yet to be unveiled, but it is expected that the vehicles would be 50 percent financed by the government of Punjab, while the buyer would have to pay the rest.
There are concerns of possible lack of transparency in financing.
Besides, there is a lack of clarity about the time period over which the scheme would be spread.
Furqan Punjani, an analyst at the Topline Research, said that there are possibilities that out of 20,000 only 12,000 to 15,000 units will go in the said scheme and the rest might fall victim to corruption.
An analyst at Arif Habib Research said that it is believed that PSMC’s car volumes would spike by nine percent and 16 percent in CY11E and CY12F.
Consequently, the earning pershare (EPS) of the company would improve by 75 percent and 116 percent in CY11E and CY12F, respectively, he said.
http://www.thenews.com.pk/TodaysPrintDetail.aspx?ID=53955&Cat=3&dt=6/23/2011
KARACHI - The State Bank of Pakistan (SBP) has stated that the size of the fiscal deficit cannot be reduced unless the government controls excessive borrowing from the central bank, along with fully implementing fiscal reforms, according to State Bank’s Third Quarterly Report on the State of Pakistan’s Economy for FY11 released Monday.
“Desirable revenue generating measures - broadening of the tax base, improving documentation of the economic system, gradual elimination of un-targeted subsidies and curtailment of quasi-fiscal operations are necessary to contain the fiscal deficit to below 4.5 per cent of GDP in FY12”, said the report.
“These efforts need to be accompanied with better debt management to increase the tenor of domestic debt and lower risks associated with debt re-pricing and rollover,” it added.
The report predicted these initiatives will also protect the external account position and rebuild confidence of the private sector and the country’s international development partners. More importantly, this will help in reducing inflation and the crowding out of private sector credit, thereby facilitating investment, growth and employment opportunities.
The SBP report further said the impact of the widening fiscal deficit is clearly visible in the sharply rising domestic debt. The outstanding government domestic debt reached Rs 5,594 billion (31.8 per cent of estimated GDP) which is more than double the stock at end-June 2007, the report said and added that this sharp growth in debt stock is fueling concerns about macro stability and monetary management.
The report showed optimism about the next cotton crop for several reasons: (a) higher cotton prices during FY10 encouraged farmers to increase acreage for the next crop; (b) there is a shift towards more productive (and disease resistive) BT cotton seeds; and (c) water availability is expected to improve over last year. Rising fertilizer prices are the key downside risk at the moment.
According to the report, the government has set the wheat procurement target at 6.57 million tones, which is lower than the target for the previous year. However, the government may come under pressure to exceed this target since the market price of wheat is considerably lower than its support price while banks appear to be willing to finance the additional procurement. This could feed the circular debt problem and also crowd out the private sector at the margin.
“While energy shortages continue to impact a number of industries, some sectors could face new challenges. For example, the disruption in the global supply of auto parts from Japan may impact some manufacturers in Pakistan. In addition, auto manufacturers will face stiff competition from imported cars as the government has increased the age limit for used imported vehicles from 3 to 5 years,” it commented.
http://nation.com.pk/pakistan-news-newspaper-daily-english-online/Politics/05-Jul-2011/SBP-asks-govt-to-contain-borrowing
Oxfam Media Officer, Caroline Gluck, is currently travelling in Sindh district in Pakistan. She sends us this blog from there:
Mother of five, Sodhi Solangi, can’t stop smiling as she shows me her new eight acre plot of land. Cotton crops are growing and, a little further away, building work is almost finished on a large new house overlooking the fields where her family will soon settle.
Just a few years ago, 42 year old Sodhi, who lives in Ramzan Village, Umerkot district, in Sindh, Pakistan, was landless. She and her husband used to work on others’ lands, earning a share of the crops as payment. Daily life was a struggle.
“We often had problems”, Sodhi recalled. “Sometimes we had money, sometimes not. It was very hard for us. We’d spend all our days working on someone else’s farm and our children would be at home.
“We wore torn clothes. But now things are very different. When you like something, you can go out and buy it. Before, we would have to ask the landlord to give us money if we wanted anything, but now we have money in our hands and we can buy things whenever we want.”
“Now we have our own land and are working on our own land. It feels so good when we work there. When we used to work for others, we would have to drag ourselves there.”
Her family’s luck changed when Sodhi was awarded eight acres of land, under a programme run by Sindh’s provincial government, which in 2008 began redistributing swathes of state-held land to landless women peasants. The landmark scheme was an attempt to lift more people out of poverty in the province, where more than two-thirds of the population work the land, but where bonded labour is still widely practiced and most land is still held by wealthy and political influential elites.
Sohdi and her family grew wheat and cotton on their new land. And they managed to earn enough profit to buy another eight acres.
“We were so happy when we go our land. Now, things are so different”, said Sodhi. “Whenever we want to eat anything, we can just buy it. Before, we used to eat dal and potatoes. Now we can buy all sorts of things – mangos, even chicken.”
“Everyday, we have a lot of food. It’s like a festival of food for us every time!” she said, laughing.
Meat is an unaffordable luxury for most poor farming families – and one telling sign of just how much Sodhi’s life has turned around.
Her neighbours and relatives jokingly call her “lady landowner” and many told me they planned to apply for land during the next phase of the redistribution scheme.
But Sodhi is one of the lucky ones. Her land, though parched and lacking proper irrigation, is still cultivable; and, unlike many women, Sodhi didn’t face legal claims disputing her right to the land from wealthy landowners or others living nearby.
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“The landlord sent officials to threaten the women here saying : ‘We will destroy your homes and take your tractors. ‘ He also threatened to send the police to our home”, said Shareefa Gulfazar, who is in her fifties, and was awarded 4.5 acres of land.
Her daughter, Dadli Kehar, who was awarded 3 acres of land, fears they are being tricked out of what is rightfully theirs. With the help of Oxfam’s partner Participatory Development Initiatives (PDI), both women plan to fight through the courts for what they believe is their right to the land.
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Despite the threats and the likelihood of a lengthy legal battle, Shareefa and Dadli intend to fight for their land. They know that having their own land can empower them as well as help to feed their families and ensure they have a better future.
http://www.oxfamblogs.org/southasia/?p=1088
Pakistan did not carry out essential land reforms soon after independence. As a result, critics say, Pakistan's agricultural and rural sectors are characterised by highly feudal relationships which keep many in abject poverty, including bonded labour. It's estimated that more than 60% of farmers in Sindh are landless, while vast tracts of farmland are still owned by small wealthy elites who wield huge political and social influence.
Sindh's land distribution programme is a bold step forward. For the first time in Pakistan as well as South Asia, state land is being specifically distributed to landless women peasants, in an attempt to begin reducing poverty and bringing about much wider social changes in rural areas.
"It's very important for me to get land"
When I visited the packed kutchari, or open hearing, it was bustling with activity. Many women and their families had traveled in vans organised by Participatory Development Initiatives (PDI), a local partner supported by Oxfam, to ensure as many deserving women as possible had the chance to register for land. PDI staff were also on hand to help those unable to read and write to fill out land application forms; and for weeks earlier had carried out awareness campaigns about the land distribution programme, including using local radio broadcasts.
"It's very important for me to get land," said mother of four, Janat, who currently farms on four acres of land belonging to her landlord. Her family only receive a quarter of the crops they cultivate - the landlord takes the rest.
"We want land of our own to pass on to our children; to have our own house and not live with threats or the fear of having to move. A landlord can ask us to leave at any time," she explained.
Another lady, Sakina, who traveled with her six-year-old son, chipped in. "Security is a priority for us. If we own land, we will have a safe house; no corrupt people can snatch our crops from us... There are always threats from influential people who can take the land from us."
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The second phase of distribution is now solely targeting landless women. It hopes to iron out many of the flaws in the original process, as well as offering women longer-term packages of agricultural support including providing seeds, fertilisers, pesticides and technical help.
Faisal Ahmed Uqaili, co-ordinator of Sindh government's Land Distribution Programme, acknowledges that about 50% of the original land allocated had proved problematic. But he says that lessons have been learnt and around 80% of cases have been settled. Officials were also under strict orders to ensure greater transparency, he says, to stop nepotism and corruption. There had been cases reported of officials trying to sell application papers to the women, or grant land to people favoured by influential political leaders.
"You need to say the glass is half full instead of half-empty," Faisal told me. "When you meet these success stories, women are now making a livelihood for their husbands and families. There is a marked difference. If change is coming in the life of the people for this allotted land and for a fairly large percentage of people, then it's the start of success."
Mother-of-seven Beebul Hassan's face lights up as she holds up a slip of paper with a signature showing that she's been successful in her application. She is now the proud owner of four acres of land.
http://reliefweb.int/node/357648
Landlessness consistently comes up as one of the most important correlates of income poverty in statistical and econometric analyses of poverty-related data in Pakistan. The World Bank’s Pakistan Poverty Assessment used data from the Pakistan Integrated Household Survey (PIHS) 1998-99 to show that the head-count ratio of
poverty among the rural landless was 40.3 per cent, while for those owning land it was 28.9 per cent. Even the owners of marginal holdings of less than one acre had a head-count ratio of 31.8 per cent – or 8.5 per cent points lower than that of the
landless.20 These findings are corroborated by the Participatory Poverty Assessment which identifies land ownership and access to land as being among the primary determinants of rural poverty.21 Besides its direct impact on agricultural livelihoods, the distribution of land ownership in Pakistan also had broader economic, social and political implications for poverty. The existence of monopolistic landlords was thought to be associated with the creation of monopolistic conditions in other markets – such as those for credit, water, inputs and outputs – and thus created uneven conditions. Furthermore, locally
monopolistic landlords were thought to adversely affect the quality of governance of
public institutions, including mechanisms for political accountability.
http://www.rspn.org/publications/Microsoft%20Word%20-%20Access%20to%20Land%20&%20Poverty%20Reduction%20in%20South%20East%20Asia.pdf
Inflation is the price that ordinary Asians are paying for high growth rates.
For the less well-off, who spend their money on food and fuel, the story is even worse. The rise in their household expenses at the moment is usually higher than headline inflation rates.
According to the International Monetary Fund, last year consumer prices rose 13.2% in India, 11.7% in Pakistan and 9.2% in Vietnam. Other Asian nations coped better but the average for developing Asia was 6% - compared to a 1.6% average rise in prices in advanced economies.
The speed at which prices are shooting up means that unless people find ways to save and invest effectively, they in fact get much poorer - even if Asia is getting richer.
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The world is jealous of Asia's sky-high growth rates, but for ordinary people the price of success is corrosive inflation which could eat away their savings.
"From outside it looks good," says Manasi Pawar. "We're staying in a big house, paying so much in rent and our kids are going to great schools."
Manasi, a qualified software worker in hi-tech Hyderabad in India, recently became a full-time mother. Her husband also works in the IT industry.
The couple epitomise the emergence of a well-to-do middle class in Asian countries - except there's one significant snag.
"We were actually losing money," says Manasi.
The couple recently woke up to the fact that inflation rates of nearly 9% meant that their savings were actually disappearing in front of their eyes.
"We were sitting on a bunch of cash but we didn't know where to put it, and it's important that we don't let it lie there in the bank - because a bank doesn't give an interest rate that even matches the inflation rate," she says.
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The poorest people in society, who spend disproportionately more on food, are hit most savagely of all.
But there is a way to fight back against inflation: to save, and to put some of that money in a part of the economy that rises along with inflation.
For most people, that means investing in shares or equities. "The only way you can make money long-term is through an equity linked product," says Ms Halan.
Money in the bank in India may only earn 3% or 4% - which in fact means you are losing money. But equity linked funds in this exploding economy have risen much faster, sometimes as high as 25%.
http://www.bbc.co.uk/news/business-13959235
....In developments that parallel events in the other Asian powerhouse, neighboring China, rising prices have forced the government to steadily tighten monetary policy. Interest rates rose for the 10th time in 16 months last week.
But business leaders are unhappy. They say the medicine could be making the economic situation worse.
Much of the inflation in India is a function of higher oil and food prices, factors that respond poorly, if at all, to higher interest rates. Instead of depending on the central bank, the government needs to push through the kind of agricultural reforms and investment it has been talking about for years, analysts say.
“Government policy should be focused on improving agricultural productivity, but because that isn’t happening, the burden is falling more and more on monetary policy,” said Sanjay Mathur, Royal Bank of Scotland’s Asia emerging markets economist in Singapore. “Consequently, a number of sectors that shouldn’t be getting hurt are getting hurt.”
That means growth could fall back toward 7 percent, some economists warn, still faster than that of any major economy except China but below what India could achieve — and needs, if it is to pull hundreds of millions of people out of poverty.
“There is no point substituting one bad policy with another bad policy,” said Surjit Bhalla, chairman of Oxus Investments. “When the patient is down, don’t give him another kick in the pants.”
In the early 1990s, India’s government pushed through a series of economic reforms that unshackled the private sector and laid the foundation for two decades of strong growth. With that growth has come rising incomes, an expanding middle class and changing eating patterns. No longer dependent solely on rice, lentils and grains, Indians are demanding more vegetables, fruit, eggs, meat and fish.
Local agriculture has not kept pace. Farmers grow the wrong mix of crops, and about 40 percent of production is wasted before it reaches market because of inadequate distribution, warehousing and cold-storage systems.
Add to the mix a rural employment scheme that has boosted the incomes and appetites of India’s poorest, and a demographic bulge in hungry 15- to 24-year-olds, and it is little surprise that food prices are rising steadily year by year.
That in turn has pushed up wages, while production of raw materials such as coal, ores and cotton is also struggling to keep up with rising demand. Inflation hit 9.1 percent in May, and the central bank says it is expected to remain high through at least September.
To get food prices down, the government needs to promote horticulture and revolutionalize agricultural marketing and distribution, economists say. Allowing foreign companies such as Wal-Mart to set up supermarkets in India and invest in cold-storage facilities, a long-promised but still undelivered policy goal, would also help, they say.
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The Organization for Economic Cooperation and Development last week underlined the need for a new set of reforms in India to bolster growth, and no one in the finance or planning ministries seemed to disagree. The problem is getting it done.
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Higher interest rates are choking much-needed investment, which was almost flat in the first quarter of this year and grew just 4.1 percent year over year, as overall economic growth slipped to 7.8 percent.
The stock market is sliding — shares are down more than 14 percent this year, making India the worst-performing market in Asia. That in turn makes it more difficult for companies to raise the capital they need to invest.
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http://www.washingtonpost.com/business/indian-economy-starts-to-slow-down/2011/06/23/AGvjUBiH_story.html
...“The rural push is aimed at the boisterous youth in these areas, who have bountiful cash and resources to increase purchases,” Shazia Syed, vice president for customer development at Unilever Pakistan Ltd., said in an interview. “Rural growth is more than double that of national sales.”
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Nestle Pakistan Ltd., which is spending 300 million Swiss francs ($330 million) to double dairy output in four years, boosted sales 29 percent to 33 billion rupees ($377 million) in the six months through June.
“We have been focusing on rural areas very strongly,” Ian Donald, managing director of Nestle’s Pakistan unit, said in an interview in Lahore. “Our observation is that Pakistan’s rural economy is doing better than urban areas.”
The parent, based in Vevey, Switzerland, aims to get 45 percent of revenue from emerging markets by 2020.
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Haji Mirbar, who grows cotton on a 5-acre farm with his four brothers, said his family’s income grew fivefold in the year through June, allowing him to buy branded products. He uses Unilever’s Lifebuoy for his open-air baths under a hand pump, instead of the handmade soap he used before.
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Sales for the Pakistan unit of Unilever rose 15 percent to 24.8 billion rupees in the first half. Colgate-Palmolive Pakistan Ltd.’s sales increased 29 percent in the six months through June to 7.6 billion rupees, according to data compiled by Bloomberg.
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Unilever is pushing beauty products in the countryside through a program called “Guddi Baji,” an Urdu phrase that literally means “doll sister.” It employs “beauty specialists who understand rural women,” providing them with vans filled with samples and equipment, Syed said. Women in villages are also employed as sales representatives, because “rural is the growth engine” for Unilever in Pakistan, she said.
While the bulk of spending for rural families goes to food, about 20 percent “is spent on looking beautiful and buying expensive clothes,” Syed said.
Colgate-Palmolive, the world’s largest toothpaste maker, aims to address a “huge gap” in sales outside Pakistan’s cities by more than tripling the number of villages where its products, such as Palmolive soap, are sold, from the current 5,000, said Syed Wasif Ali, rural operations manager at the local unit.
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Unilever plans to increase the number of villages where its products are sold to almost half of the total 34,000 within three years. Its merchandise, including Dove shampoo, Surf detergent and Brooke Bond Supreme tea, is available in about 11,000 villages now.
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Pakistan, Asia’s third-largest wheat grower, in 2008 increased wheat prices by more than 50 percent as Prime Minister Yousuf Raza Gilani sought to boost production of the staple.
“The injection of purchasing power in the rural sector has been unprecedented,” said Sherani, who added that local prices for rice and sugarcane have also risen.
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Increasing consumption in rural areas is forecast to drive economic growth in the South Asian country of 177 million people, according to government estimates.
Higher crop prices boosted farmers’ incomes in Pakistan by 342 billion rupees in the 12 months through June, according to a government economic survey. That was higher than the gain of 329 billion rupees in the preceding eight years.
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Telenor Pakistan (Pvt) Ltd. is also expanding in Pakistan’s rural areas, which already contribute 60 percent of sales, said Anjum Nida Rahman, corporate communications director for the local unit of the Nordic region’s largest phone company.
Karachi - To effectively cope with domestic market of over 1.5 million units and after successful launch of their products in global markets, the local motorcycle producers are now planning a further investment of $100-150 million in their existing units.
The motorcycle industry analysts have pointed out that despite numerous hiccups faced by the economy in recent years, growth in motorcycle production has been robust at 15 per cent. “A decade back, the total motorcycle production in Pakistan was around 100,000 units, now the largest player alone is rolling out half a million units while total production of two wheelers has crossed 1.5 million. They said that the encouraging aspect in this regard is that industry is on the path to sustained growth. The local demand for motorcycles is likely to exceed 2 million units within a year or two,” they added.
“The global response to our quality motorcycles indicate a sustained and healthy growth in exports as well” they opined, adding that in fact, the industry experts are seeing themselves as the largest exporters in the engineering sector. A sustained growth is only possible due to regular investment and up-gradation of technology in the motorcycle industry. “The growth we see in motorcycle production would not have been possible without investment”, they added.
In this regard, Fahad Iqbal CEO, HKF Engineering, makers of Ravi motorcycles said that the industry now has to fulfill the growing demand in both domestic and global markets and for this, it needs to invest over $100 million in the next couple of years to keep abreast with market needs and demands. He said that all the motorbike producers having production of 50,000 units or above are now planning to expand their capacities to cope up with the market demands.
“There are almost a dozen players that have achieved this production level” he said, adding that even if each of them invests $10-15 million, the total investment would cross $150 million. These units have been regularly making investments to increase their market share but now they have reached a level where they have to invest in high-tech parts to ensure that instead of having 90 per cent local components, Pakistani bikes are produced by 100 per cent local parts, he added.
Market analysts urged that in such an encouraging situation, the government should refrain from taking steps that might jeopardise this investment. He said that an investment of $150 million by local players without any government concession is better than vying for similar investment over a period of 10 years from a foreign company. The current players, from Italy, China and Japan, are also in various stages of developing new models in the 100-150 cc range with the latest technology, he said. However, he added, they were not offered any relief even on imports of the environmentally friendly Euro 2 components, which have already been introduced in local bike production.
“Capacities exist in the country in areas like sheet metal parts and there is a huge investment need in areas such as die casting for parts like crank cases and crank covers, electronic parts such as CDI units, engine parts like ACG, clutch, pistons, shock absorbers (cushions), plastic parts such as emblems” said Arshad Awan CEO General Engineering and added that even capacity enhancement and thus investment will be needed in low-tech parts like head lights, tail lights etc.
http://www.pakistantoday.com.pk/2011/08/bike-manufacturers-plan-heavy-investment/
LAHORE, PAKISTAN — In the Pakistani village of Sharbaga, about 130 kilometers from Lahore, a 70-year-old farmer named Mohammed Ali and his wife plant rice seedlings in a wide field. They stand ankle-deep in muddy water holding thin green leaves that they deftly press into the ground. It is hard work under a blazing sun, but this seemingly mundane task is a significant development that can help rural Pakistanis improve their lives.
Just a few years ago, this rice paddy and most of the surrounding fields in this village of 5,000 were barren. For decades the land has lain fallow because it is saline from poor groundwater.
In 2006, the government of the state of Punjab, traditionally Pakistan’s breadbasket, and the United Nations Development Program started an agriculture project to rehabilitate saline farmland by treating it with gypsum. The Punjab government pays for two-thirds of the project’s six-year, $17 million budget, while the U.N. program pays for the rest.
Nearly six million hectares, or about 15 million acres, across Pakistan, including 2.3 million hectares in Punjab, are barren because of salinity and water logging. Gypsum’s calcium composition can neutralize saline soil. Within a season of applying the white powder, farmers like Mr. Ali had transformed a long-degraded land into a field that yielded bountiful crops of rice and wheat.
Forty-three percent of Pakistan’s population of 170 million depends on agriculture for their livelihood and two-thirds of the country’s citizens live in rural areas. Projects that help improve the lives of people on the ground are critical to creating stability in Pakistan, and yet these are often overlooked.
Sustainable agricultural growth is a “necessary condition for rural growth, employment generation, poverty reduction and social stability,” said a 2009 report on Pakistan’s agricultural potential by Weidemann Associates, an economic development consulting firm near Washington. The report was prepared for the U.S. Agency for International Development in Pakistan.
The biosaline project in Punjab has already helped lift 50,000 households out of poverty by raising incomes. From 2007 to 2010, the increase of rice and wheat production on rehabilitated land totaled 417,016 tons, worth $122 million.
Dozens of enthusiastic farmers who gathered to meet a visitor to Sharbaga this past summer were unequivocal about how the agriculture project had improved their lives. Before the project, there were few ways to make money in the village aside from sporadic manual labor. Farmers owned small parcels of largely infertile land, and most of the men migrated to cities for work in factories or as temporary laborers.
Now, all the men said their farming incomes had double or tripled, to as much as $230 a month, compared with the $90 or less that they could earn working in a factory, and migration to the cities is declining.
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Reviving agriculture has been life-changing for many rural Pakistanis. Zeba Bibi, who also cultivates a garden in Liliani village, wants to know how she can make her mango trees healthier and more productive. She aspires to one day buy a tractor with extra income from crops grown on her family’s desalinated land. “We are looking forward to a better life,” she said.
http://www.nytimes.com/2011/11/17/business/energy-environment/soil-renewal-puts-pakistans-poor-on-stronger-ground.html
Pakistan makes foray at SIAL Middle East to explore the Gulf food market and boost exports by attracting local and regional players participating in the region's premier food fair, which opened Tuesday at the Abu Dhabi National Exhibition Centre.
Seven Pakistani firms attending the three-day event for the first time displayed their range of products at the Pakistan pavilion.
They will meet local food importers and regional players to explore the market, which is expected to cross $50 billion by 2020.
"Pakistan has emerged as an important player of food supplies to the UAE and Gulf region particularly in rice, meat, poultry, seafood, fruits, vegetables and spices. We hope SIAL Middle East will facilitate our exhibitors both in product and geographic diversifications," Pakistan Ambassador to UAE Jamil Ahmed Khan told Khaleej Times.
The second edition of SIAL Middle East welcomed 12,000 trade visitors with exhibitor line-up of more than 500 food, beverages, equipment manufacturers, suppliers.
Argentina, China, Italy, Iran, France, Pakistan, South Korea, Taiwan, Thailand, Turkey, Tunisia, UAE, UK and US also set up pavilions to exhibit their products to make inroads in the region striving to ensure food security amid rising inflation across the globe.
According to a new research, Gulf Cooperation Council (GCC) states will spend $53.1 billion by 2020 on food imports to feed growing population.
The region, spent $25.8 billion on food imports last year, depending heavily on imports of agriculture and food products.
Food consumption in GCC is expected to rise at the rate of 4.6 per cent annually between 2011-15 and reach 51.5 million tonnes per year during this period.
Pakistan's exports of food products to GCC region stand at $1 billion and UAE shares around 50 per cent of the total bill.
Appreciating premier event, Pakistan Ambassador said SIAL food fair has become a truly international brand.
"It’s a great pleasure to be part of this food event for first time. We welcome valued visitors to the Pakistan pavilion who will have a chance to meet with our leading food suppliers at this dedicated business platform in the thriving region of the Middle East."
Pakistani exhibitors displayed rice, juices, assorted pickles, edible oil, fresh fruits, vegetables, assorted syrups, wheat flour and flour products among others.
According to Pakistan Embassy officials, Pakistan has the potential to double its food export to the UAE by adding value to its products.
"Our average unit price of food exported items is comparatively less than most of the competing countries, but we need to do value addition by establishing brands in the region," an official said.
http://www.brecorder.com/pakistan/business-a-economy/36142-seven-pakistani-firms-explore-food-market-in-gulf-.html
Supply of good quality seed is the base of sustainable and developing economy. "For improving the seed quality Pakistan Agricultural Research Council (PARC) Scientists are making appreciable efforts in agriculture research sector", Dr Iftikhar Ahmad, Chairman, PARC said while speaking in a meeting here on Tuesday.
The meeting on "Review of Variety Release and Seed Production System in Pakistan" was jointly organized by PARC and International Center for Agricultural Research in the Dry Areas (ICARDA). The PARC Chairman further elaborated that seed supplied to farmer is an important measure for achieving enhanced agricultural production. "Due to lack of awareness and information about quality seed we are unable to achieve required productivity, and the bad quality seed has the potential to threaten food security for whole country", he added.
Foreign delegate from ICARDA, US Department of Agriculture (USDA), and International Maize and Wheat Improvement Center (CIMMYT) were present on the occasion. Provincial presentation under the guidance of Secretary Agriculture, Government of Punjab, Arif Nadeem and heads of other agricultural institutes from Sindh, Balochistan, and Kheyber Pakhtoonkhwa graced the occasion.
Dr Iftikhar Ahmed, who chaired the meeting emphasized on improved varieties for quality seed that are basic requirements for enhancing the agriculture productive as well as in livestock sector.
He said that seed certified Cooperation Department also established in Khyber Pakhtunkhwa, Sindh, Balutistan, Baluchistan as in functioning Punjab province for betterment of farmers and also launched a campaign for awareness of quality seed.
During a roundtable meeting of which 30 members participated from across the country discussed current challenges that are being faced to the seed sector.
The members of the meeting special focused on accelerating the transfer of new improved varieties to farmers. The meeting was a follow-up of a three-week mission sponsored by ICARDA during which seed specialist Dr Mishael Turner had wide-ranging consultations with both public institutions and private companies.
He was of the view that the threat posed by epidemics of rust diseases of wheat had raised awareness about the need to move new improved resistant varieties rapidly from research institutes to farmers through the variety release system.
These concerns enabled ICARDA to secure funding from USAID to compare variety release procedures in different countries.
Discussion among the participants covered many issues affecting plant breeding and the seed industry in Pakistan and provided an open exchange of opinions among the stakeholders. Key themes that emerged from the meeting included the need to strengthen public private partnerships and the ways to improve capacity building for all partners of the seed sector.
There was an agreement among the participants that the new Ministry of National Food Security and Research should take up these issues as soon as possible.
http://nation.com.pk/pakistan-news-newspaper-daily-english-online/Business/14-Dec-2011/Quality-seed-vital-for-agri-development
Pakistan is as an emerging country of fully traceable products for the world to meet food supply demand of increasing global population.
Chief Minister, Punjab, Muhammad Shahbaz Sharif at a meeting with EU ambassadors said Punjab government has diverted substantial resources to develop science-based, vibrant and internationally linked agriculture sector that could not only meet the food security challenges but also compete in domestic as well as in international markets.
Punjab Government has entered into certification regime to produce fully traceable agricultural and livestock products to reach high-end markets of the developed world and to enhance export upto $2 billion annually, he added.
He said Pakistan has the potential to become 10th largest economy of the world after Germany. He apprised the distinguished envoys Punjab government has allocated Rs 2.024 billion for a mega project to improve supply chain of selected agricultural and livestock products for improving quality and introducing traceability as per international market standards and requirements.
He said participation of Punjab in the forthcoming International Green Week (IGW), Berlin Germany would be an excellent opportunity to showcase traceable agricultural and livestock products from Punjab and to project Pakistan.
He said display of traceable agricultural and livestock products at IGW would open the doors of high-end markets of the world leading towards generation of tremendous business opportunities for Punjab, Pakistan.
He said Punjab government was benefiting from Star Farm and Metro to enhance capacity of our producers, suppliers and traders to boost exports.
Ambassadors from 18 European Union countries including Lars-Gunnar Wigemark, EU ambassador to Pakistan were present in the meeting.
Lars-Gunnar said Punjab has tremendous potential in agriculture and livestock sectors to get its due share in global trade of food products. He lauded Punjab government for adopting techniques and standards required for food safety and quality, and linking its traceable agricultural products to the global markets.
Arif Nadeem, Secretary Agriculture said 15-20 fully traceable fruits, vegetables, rice and meat products would be showcased at IGW for which capacity of about 25 exhibitors has been built for compliance of Global GAP and International Featured Specifications (IFS) by Star Farm.
He told METRO would organise Pakistan week in their chains in Berlin, parallel to the IGW event, therefore, fresh produce to be brought in Germany would not only be displayed and sold at the event but also at the Metro stores/chains in Berlin.
He said a vendor selected for the event has prepared thematic design of Pakistan pavilion, which contains Business to Business (B2B) and Business to Consumer (B2C) areas for display of products.
The concept, ‘farm to fork’ will be demonstrated through cooked dishes of traceable products as well at the
occasion, he added.
Rizwan Khan, Vice Chairman, Punjab Board of Investment and Trade highlighted the significance of International Green Week scheduled for January 20-29, 2012 at Berlin, Germany and briefed about aesthetics and media coverage of the event, embassy coordination and back end support in terms of product development.
The diplomats of EU Countries and others expressed satisfaction on the level of preparedness of Punjab government for participation in the forthcoming IGW, Germany.
http://www.dailytimes.com.pk/default.asp?page=2011\12\18\story_18-12-2011_pg5_7
LAHORE – Pakistan is likely to spoil its surplus wheat owing to its high price as compared to the international market and substandard storage system, losing an opportunity to earn millions of dollars through its export.
Experts feared that fresh imminent increase in the wheat support price will halt export of wheat and its products. At present, 5.5 million tons of wheat was lying in stores and open places with public sector departments while our requirement for next few months was only two million tons. They said 1.4 million tons of wheat was present only in Punjab and added that one of the prime reasons of piling up of this wheat stock was high prices.
Former chairman of the Flour Mills Association, Asim Raza Ahmed, while talking to The Nation, claimed that wheat prices were already high in Pakistan as compared to other countries. Supporting his claim, he said Russia had sold wheat to Egypt and Iraq at the rate of $220 to $250 dollars per ton which in Pak rupees is Rs 22,000 per ton compared to Pakistani wheat price of Rs 23,750 per ton. He said that wheat was playing an important role in agriculture of Pakistan. Pakistan is not only self-reliant in this crop from the last three years but also exporting wheat. Pakistan exported 1.7 million tons of wheat and 1.3 million tons of wheat products this year and was competing on this front with Russia, Turkey, Australia, India and America. Some experts were of the view that the government’s poor measures for utilizing bumper wheat crops may cause it billions of rupees losses again because of substandard ways of stocking of the commodity in packing material, which is not recommended by the experts.
The upcoming wheat harvesting season will be overwhelmingly tremendous as the government increased the wheat support prices to Rs 1,050 per maund for encouraging the production of the commodity. But it will also be harmful for the growers, as they will fail to dispose of their commodity due to high rates.
The country is expected to harvest more than 25 million tons of wheat in the next season as against the national requirement of 21 to 22 million tons, leaving surplus of about 3 to 4 million tons of wheat for export market, which should be exported to earn precious foreign exchange for the country.
http://nation.com.pk/pakistan-news-newspaper-daily-english-online/Business/18-Dec-2011/Surplus-wheat--export-in-jeopardy
Dec. 19 (Bloomberg) -- Pakistan, the fourth-largest grower of cotton, may buy as much as one million bales through state- run Trading Corp. to support prices, the spokesman for the country’s ginners’ group said today.
“Our group is meeting the prime minister today to settle the details of the deal,” Arshad Islam, spokesman for Pakistan Cotton Ginners Association, said in a phone interview from Karachi. “We are expecting to sell one million bales and above. The last time the government bought from us was in 2005, when they bought 1.6 million bales.”
Cotton prices in Pakistan have declined 42 percent in the financial year started July 1, tracking weak international rates as demand from China waned and global production rose. Cotton in New York has tumbled 59 percent since reaching a record $2.197 per pound on March 7.
Pakistan is hoping to grow 12.7 million bales in the year that began July 1 on better yields, the association said on Dec. 13. This is higher than the 12.2 million bales estimated by the government in October. A bale in Pakistan weighs 170 kilograms (375 pounds).
http://www.businessweek.com/news/2011-12-19/pakistan-may-buy-1-million-bales-of-cotton-to-support-prices.html
ISLAMABAD, (Asia Pulse) - Pakistan's exports of food commodities surged by 22.73 percent during the first five months of the current fiscal year to reach at $1.514 billion, Federal Bureau of Statistics (FBS) reported.
The overall food exports were recorded at 1.514 billion during July-November (2011-12) as compared to the exports of $1.233 billion during July-November (2010-11), according to FBS figures issued.
The food products that contributed to positive growth included fish and fish preparations, exports of which increased from $106.742 million last year to $125.959 million during the first five months of this year, showing an increase of 15.83 per cent.
Exports of fruits also increased by 13.94 per cent from $77.753 million to $88.595 during the period under reviews, showing positive growth of 13.94 per cent, the data revealed.
Exports of vegetables and tobacco increased by 28.47 percent and 27.62 per cent respectively during the period under review.
During the month of November 2011, the food exports witnessed negative growth of 25.85 per cent and 6.93 per cent when compared to the exports of October 2011 and November 2010 respectively.
The overall food exports during November 2011 were recorded at $223.360 million against the exports of $301.246 million in October 2011 and $239.984 million in November 2010, the data revealed.
http://www.lankabusinessonline.com/fullstory.php?nid=152011880
An official told Online on Tuesday out of which about 25 per cent goes waste, between farms to consumers, while only 4 per cent is exported at far 41 per cent lower price compared to world average price.
The horticulture sector contributes about 12 per cent to the national agricultural Gross Domestic Product (GDP) and holds great potential for increasing export of quality horticultural produce, and offering multiple employment opportunities throughout the supply chain, he added.
The official said, “However, its growth & profitability is restrained mainly by lack of proper post harvest management and transport infrastructure. Improving post harvest management infrastructure (grading, packing, storage and transport/cold-chain) will help reduce high post harvest losses, increase production surplus along with improving shelf life and quality of fresh produce, which will help to stabilize prices in domestic markets as well as to substantially boost export to highly lucrative and competitive international markets.”
It is pertinent to mention here that Ministry of Commerce had decided to establish a “Cool Chain System” under “National Trade Corridor Improvement Project”. The Cool Chain project is bound act as a backbone for the development of supply chain infrastructure for horticulture produce.
http://www.onlinenews.com.pk/details.php?id=187430
Pakistan’s kinnow export target of 300 million tons for this year seems difficult to achieve due to the hurdles created by the customs authorities, an exporter said on Thursday.
The Co-chairman of All Pakistan Fruit and Vegetable Exporters, Importers and Merchants Association (PFVA) told The News that exporters suffered a loss of $10 million on export of kinnow, as shipments were delayed because of complete checking of consignments. “In many consignments planes left and cargo was not taken,” he said.
CEO Harvest Tradings Ahmad Jawad said Japan may be good market for Pakistan kinnow in the coming years if Pakistan Horticulture Development and Export Company (PHDEC) and Ministry of Commerce make serious efforts to explore this market as we did in mangoes last year. “The planners need to realise that there are certain areas where the private sector cannot help exports grow,” he said.
The import of citrus in Japan has doubled in 2010/11 due to decline in local production Jawad said quoting a report of the US Department of Agriculture (USDA). The US and Australian citrus import to Japan has increased substantially during the period.
The import of fresh produce in Japan increased to 21,406 tons for the 12 months to September 2011, up from 10,797 tons for the same period a year before, the USDA Global Agricultural Information Network (GAIN) report said.
The US accounted for the majority of the increased volume, with a 93 per cent jump to 17,650 tons giving it a market share of 82 per cent.
Matching with Japan’s new role as Australia’s largest citrus export market, Australian imports jumped 136 percent to 2,276 tons. New Zealand, Chilean and Taiwanese imports also grew over the period.
Japan’s citrus imports are expected to decline by about 12 percent to 19,000 tons in 2011/12, the report added, because of Japanese Mikan production bouncing back.
“On the other hand Pakistan’s export target for kinnow set at 300,000 tons this year is becoming harder to meet as the season unfolds due to unlimited blunders,” he said.
The CEO Harvest Tradings further emphasized that starting with Pakistan’s image building the trade or counsellors should work as marketing managers fully knowing about the market demand there and about the quality of products and selling tactics by Pakistan’s competitors.
They should be very much in touch with the business communities there, exchange business data and information, provide businessmen at both ends with proper consultation meant to increase bilateral trade and investment, help resolve trade disputes between entrepreneurs of Pakistan and any other country.
http://www.thenews.com.pk/TodaysPrintDetail.aspx?ID=86002&Cat=3
Pakistan Agribusiness service provides proprietary medium term price forecasts for key commodities, including corn, wheat, rice, sugar, cocoa, coffee, soy and milk; in addition to newly-researched competitive intelligence on leading agribusiness producers, traders and suppliers; in-depth analysis of latest industry developments; and essential industry context on Pakistan's agribusiness service.
Pakistan's agricultural output has steadily declined in its contribution to GDP in the past decade, down from 24.0% in 2000/01 to 20.9% in 2010/11. That said, the sector still employs the largest number of workers in the population and we expect the industry to remain a government priority as the country deals with issues of food security and the vulnerability to natural disasters. Over the long term, we foresee the dairy, poultry and wheat industries as benefiting the most from increased investment.
However, despite the existing network of irrigation systems across the country, we believe that significant improvements in infrastructure and better supply chains will have to be implemented in order for the country to reap the full benefits of its fertile soil.
Key Trends
- Rice production out to 2015/16: 7.5% to 7.3mn tonnes. We expect the country to increase its share in the basmati rice trade as production expands over our forecast period.
- Wheat consumption out to 2016: 14.2% to 25.3mn tonnes. Consumption growth will be driven by rising incomes and population growth, as well as increased access to good-quality milk.
- Sugar production out to 2015/16: 35.1% to 4.8mn tonnes. Large-scale consumers such as confectioners, candy makers and soft drink manufacturers account for about 60% of the total sugar demand and will be the main drivers of growth.
- 2012 Real GDP Growth: 3.8% (up from 2.4% y-o-y in 2011; forecast to average 3.7% from 2011 to 2016).
- Consumer Price Inflation: 11.2% average in 2012 (down from 13.7% in 2011).
- Central Bank Policy Rate: 12.0% (lower than 14.0% in 2011)
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South Asia rice exporters should benefit the most from the recent rice trade disruptions out of Thailand. So far, traders report that more than 100,000 tonnes of rice for export have been stalled as a result of the country's worst flooding in decades. Some sources estimate that this could rise to more than 300,000 tonnes. Given these developments, the spotlight has now turned to South Asia to meet demand for the grain in the near term.
Despite the recent floods, which destroyed approximately 20-30% of the sugarcane crop in the Sindh region, we forecast 2011/12 sugar output from Pakistan at 4.1mn tonnes, 2.5% up from our previous estimates. This is largely due to an overall 5-8% increase in sugarcane yields, area harvested and favourable monsoon rains during the growing season. Sugar crushing is estimated at 82% and sugar recovery at 8.8%. According to provincial reports, higher sugar prices farmers received last year, coupled with strong demand from the industrial sector, have boosted planting in the provinces of Punjab, Sindh and Khyber Pakhtunkhawah.
http://www.researchandmarkets.com/research/b503cb/pakistan_agribusin
In what appears to be a coup for the fledgling Pakistani private equity industry, Indus Basin Holdings has managed to get Britain’s former foreign secretary David Miliband on board as a senior adviser.
“We are delighted to be able to bring on board the expertise of Miliband who knows the region and its challenges well,” said Indus Basin founder and CEO Aamer Sarfraz, according to a press release issued by Miliband’s office. “He shares our conviction that investment in Pakistan’s agricultural sector can have substantial long-term impact on the country’s poorest farming communities.”
“I am delighted to be advising Indus Basin Holding, a company that is investing in Pakistan’s future at a time of such fundamental importance,” said Miliband in a press statement. “I care deeply about Pakistan, the development of its economy and its future in the wider region. IBH is committed to developing an agricultural sector which has huge potential, but currently lacks investment. I look forward to working with IBH in building support and investment in Pakistan’s agricultural capacity and productivity.”
Officials at the company say they had been trying for the past year and a half to secure the contract with Miliband, who served as Britain’s foreign secretary between 2007 and 2010. He also served as Britain’s secretary of state for the environment, food and rural affairs previously.
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Indus Basin Holdings is only a relatively recent entrant into Pakistan’s nascent private equity and venture capital space but already began to attract a lot of attention for the kinds of big-name investors it was able to attract in its fund, which is focused on capitalising on opportunities presented by raising productivity levels in Pakistani agriculture.
The company’s investors include Tim Draper, the famous American venture capitalist known for being an early investor in Skype and Hotmail, and Baron Lorne Thyssen-Bornemisza, a Swiss aristocrat whose family owns the ThyssenKrupp, a German technology conglomerate with over 670 subsidiaries and 200,000 employees worldwide.
Indus Basin’s investments currently include Agroventures, a Faisalabad-based breakfast cereal manufacturer, and Rice Partners, a company that is focused on contract farming and marketing Pakistani rice directly to North American and European retailers.
http://tribune.com.pk/story/324941/high-connections-david-miliband-joins-pakistani-private-equity-firm/
Diplomats, international economic experts and investors in Berlin, Germany have termed the exhibition of agriculture items of Pakistan in Berlin as a great success of Punjab and Pakistan. As many as 21 different products and agriculture items have been displayed in the exhibition by Pakistani farmers and industrialists.
Addressing a function held in connection with the exhibition, Punjab Chief Minister Shahbaz Sharif said that he was thankful to political leadership and senior officials of Germany for the warm welcome extended to him and his entourage.
A large number of European investors, diplomats, Pakistani citizens and farmers attended the function. The chief minister expressed the confidence that his visit would help promote export of agriculture items of Pakistan and strengthening of Pak-German relations. He praised that the hospitality extended by German government and said he would always remember the people there.
Former MPA Chaudhry Arshad Jutt, who was also a member of the delegation, apprised the audience that the exhibition was the result of the chief minister and his colleagues’ efforts. He said that the chief minister and his colleagues paid all expenses from their own pockets for participating in it. Agriculture Secretary Arif Nadeem said that the Punjab government had allocated Rs 2 billion for promoting export of agriculture items to foreign countries. He said that due to the steps taken for this purpose, now farmers had to pay only 30 percent whereas the remaining 70 percent expenses would be borne by Punjab government.
The Livestock secretary said that besides export of high quality meat to European countries and setting up of modern slaughterhouses in Punjab, production of livestock was also being increased. Punjab Investment Board Vice Chairman Muftah Ismael said that Punjab government had sent teams to various countries for the promotion of exports.
Earlier, the chief minister and his team attended a reception arranged by the head of multinational company Metro. Shahbaz said that he and his government were thankful of the Metro International for the assistance provided for the exhibition of agriculture items in Germany.
Expressing his views regarding exhibition, Metro International chairman said that the chief minister and his government had taken a bold initiative through this exhibition. Dr Andreas Kohler, member parliament and president chamber of law, said that this exhibition would play an important role in dispelling the impression of extremism and terrorism about Pakistan existing in the western world. He said that Germany was ready for extending all kind of cooperation to Punjab in arranging more such exhibitions.
Shahbaz also visited a modern slaughterhouse in East Berlin. He evinced keen interest in various sections of the slaughterhouse. He said that similar slaughterhouses were being set up in Punjab for increasing the production and export of meat. The chief minister further said that like fruit and vegetables, Punjab government is also taking extraordinary measures for promotion of livestock.
http://www.dailytimes.com.pk/default.asp?page=2012\01\23\story_23-1-2012_pg7_23
A Pakistan trade delegation, visiting Sri Lanka these days, has proposed setting up a body under the title Horticulture Export Marketing Access with the objective of facilitating export of agricultural produce to Sri Lankan markets.
The proposal was floated by the leader of the six-member delegation, Faqir Nusrat Husain, at a ceremony held in Colombo.
The delegation, sponsored by the Trade Development Authority of Pakistan, is on a week-long visit aimed at exploring ways and means to enhance bilateral trade in fruits and vegetables, flowers and other agricultural produce.
Team members include prominent agriculturalists from across the country, who have specialised in production and export of various fruits and vegetables including guava, chikoo, mango, citrus, berry, potato, dry fruits, gur, tobacco (cigar) and fresh and dry dates.
Faqir Husain told Sri Lankan agriculturalists that Pakistan’s fruits and vegetables had good quality and were also cheaper, adding Pakistan provided an ideal alternative to Sri Lanka, which imported these items from far-off countries.
Eager to reap maximum benefits from the free trade agreement (FTA) with Sri Lanka, the delegation also planned to explore opportunities in the tea industry. In this regard, it will visit Kandy to interact with the local chamber of commerce and the Tea Research Board. It will also visit tea factories and spice gardens.
The team members plan to hold meetings with Sri Lankan fruit and dry fruit importers as well as other stakeholders to explore possibilities of enhancing bilateral trade.
Sri Lanka, which imported $300 million worth of agriculture produce from Pakistan last year, was the first country to sign an FTA with Pakistan. Since the agreement came into effect in June 2005, bilateral trade has strengthened and Pakistan is the second largest trade partner of Sri Lanka in the South Asian region.
http://tribune.com.pk/story/328188/pakistan-proposes-export-facilitating-body/
In 2011/12 K&N’s expects to produce 80 million layer and broiler chicks, reports thepoultrysite.com.
In the 1960’s and 1970’s, obtaining safe, reliable sources of poultry feed was an insurmountable challenge in Pakistan. This led Khalil to set up his own feed mill to produce feed for K&N’s operations at Karachi in 1971. With the growing need of feed for the integrated production operations in Central Punjab province and Northern areas of the country, a feed mill established by a multi-national company at Lahore, was acquired by K&N’s to take advantage of low-cost feed ingredients available in the Central part of Pakistan.
The growth of commercial poultry production through the decades changed the mindset of consumers towards farm raised broilers and eggs, helped by lower prices and greater availability. Today, Desi chicken and eggs are produced in lower volumes and considered more of a delicacy.
Yet the strength of the live/wet chicken market culture, the negligible overheads of roadside sales – a butcher’s knife costs less than US$1 – and the reassurance of Halal slaughter remain significant influences slowing the uptake of processing, says Adil Sattar.
Practical problems, particularly the limited availability of cool chain facilities and frequent power breakdowns, have to be overcome with production and distribution of processed products inevitably involving high overheads.
"Earlier, within our industry, poultry processing was considered a non-viable poultry business activity as many firms had tried but ended up closing down their operations," says Adil. "At K&N’s, we endeavoured to develop the market, and other companies are now looking to start processing operations."
Today, chicken is the most popular protein source in Pakistan, primarily through the industry’s growth and success leading to lower cost and widespread availability, with per-capita consumption about 7kg (15.4lb) per year. The tradition is to eat chicken at home, always skinless cooked in curries, with rice or barbecued.
Restaurants offer local cuisine including a variety of curries, barbecue dishes and different types of rice, with a number of upmarket cafes and restaurants serving western cuisine and many of the international fast food caterers such as McDonald’s, KFC, Pizza Hut, Nando’s, Hardees and Subway also present.
The consumption of poultry meat increased by 239 percent in 11 years from 322 million tons in 1999/2000 to 767 million tons in 2010/11, but it is still only 0.7 percent of the global poultry production, experts said on Monday.
At a seminar organised by Big Bird to commemorate its 20 years association with the global poultry giant Hubbard pioneer of poultry in Pakistan Dr Yaqoob Bhatti in his paper revealed that the value of poultry infrastructure exceeds Rs300 billion and annual turnover of commercial poultry is Rs40 billion.
With 105 hatcheries, the annual broiler chick production is 820 million, he said, adding that the commercial egg production is 8.690 billion per annum in addition to 3.742 million production of rural eggs.
Pakistan Poultry Association former chairman Abdul Basit said that poultry is the cheapest source of animal protein not only in Pakistan, but the world over. The average daily animal protein consumption in Pakistan is only 17 grams per capita, while the average minimum requirement is 27 grams, he said.
There is a dire need to increase poultry production in the country that has largely grown without helpful government policies or facilitation, said Basit. The industry, for instance, has since long been demanding the government to disallow poultry farm clusters through a law as chicken farms at least 1.5km apart greatly reduce the risk of spread of diseases among various poultry flocks, he said.
He said his concern has to relocate its very large chicken farms each time when place was surrounded with many other farms too close to his farms. He said he has shifted his major high quality grand parent farms to Thar deserts. Dr Mustafa Kamal said that the consumption of mutton has declined rapidly, while that of beef and poultry has increased.
The share of poultry meat increased from 16.4 percent to 24.3 percent, he said, adding that the consumption of mutton declined from 0.649 million tons to 0.616 million tons, showing a fall of 20 percent in total meat consumption share.
Still, he said, Pakistan as a meat eating country produces around 50 percent broiler chickens of those produced in India, which has seven times human population and has a good chance to develop Grand Parent breeding operations, which has an existing capacity of producing eight million parent stocks for domestic as well as for export purposes.
Olvier Behaghel of Hubbard France said that Pakistani poultry improved efficiencies rapidly during the last 20 year that has helped it control the cost. Maturing time of a broiler has reduced during this period from four days to 46 days and from 38 days to 40 days, he said.
The weight gain of the chick at the time of maturity has increased from 1.5-1.7kg to 1.9 to 2kg and feed consumption by the time of maturity has declined from 2.2-2.5kg to 1.7-1.9kg. “Pakistan, he said, is gradually reaching global and Hubbard standards in chicken health, morality and efficiency in productive processes.
http://www.thenews.com.pk/TodaysPrintDetail.aspx?ID=70726&Cat=3
Even as the economy continues to grow sluggishly, Nestle Pakistan announced another year of record breaking profits, which grew by 13.5% to reach Rs4.7 billion – or about Rs102.94 per share – on the back of a 26% increase in revenues, which reached Rs64.8 billion.
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Managing Director Ian Donald – a South African national who has been with the global parent company for 40 years – believes the key for Nestle to grow in Pakistan is primarily by growing the packaged foods market.
“Take the example of yoghurt. We are 80% of the market when it comes to packaged yoghurt. But that packaged segment is only 2% of the total market,” he said in an interview with The Express Tribune. “So it doesn’t really matter what our market share is. We need to grow the whole packaged segment.”
A key constraint to growing that segment, however, seems to be the limited purchasing power of the ordinary Pakistani consumer. “Our single biggest challenge is how to get the right quality product to the consumer at a price that they can afford,” said Donald.
Over the past year, inflation has not helped matters. While Nestle’s global food portfolio is highly diversified, in Pakistan it focuses heavily on milk and dairy products. As milk prices continue to rise by more than 20% a year, the company has not been able to pass on the entirety of that effect to its customers. This is at least partially reflected in its gross profit margins, which shrank by 1.2% to 25.8% in 2011. Energy costs have continued to go up as well. Nonetheless, the company was able to grow the volume of products sold by a healthy 12%.
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“We have a lean mindset,” said Giuseppe Bonanno, the company’s head of finance and control in Pakistan. The company’s operating costs are certainly lower than most of its competitors. For instance, Nestle’s logistics costs are about 12% of revenues, compared to between 18% and 19% for both Unilever Pakistan and Engro Foods, two of its biggest competitors. Part of the advantage is economies of scale: Nestle about as big as both of its rivals combined. But part of it, said Donald, is that the company invests heavily in its infrastructure. In 2011, the company invested about Rs8.9 billion in building up its capacity.
Nestle already has a gigantic infrastructure in Pakistan. The company collects milk from over 190,000 farmers spread out over an area of about 145,000 square kilometers.
Another part of its growth strategy seems to be augmenting and developing its existing brands rather than adding newer brands to its line-up in Pakistan. “We cannot afford to invest in too many brands because we cannot grow all of them,” said Donald.
However, the company has introduced brands such as Nido Bunyad, which is a powdered milk product targeted to the rural consumer at a price that is competitive with non-packaged milk.
The rural economy seems to be a key market for Nestle. “It seems to us that the rural economy is growing faster than the urban economy. However, we are also consciously driving growth in the rural markets,” said Donald.
The company identifies its fastest growing markets as Peshawar, Multan and areas that it describes as “peri-urban”, areas that lie on the outskirts of most large cities and form a part of its metropolitan area.
Nestle’s growth in Pakistan has been a mixture of both organic as well as through acquisitions. When asked about whether Nestle might pursue acquisitions in the future, Donald replied: “We are always open to considering opportunities.”
As part of its plan over the next three years, the company will spend about 320 million Swiss Francs in growing its presence in Pakistan.
http://tribune.com.pk/story/333671/despite-stellar-earnings-nestle-pakistan-aspires-for-better-results/
The US Ambassador Cameron P Munter on Saturday said that the United States is committed to the development of Pakistan’s agricultural sector.
The United States is working with government and private sector authorities to improve productivity and food security, and to increase farmers’ incomes and stimulate overall economic growth, he said speaking at the Dawn Pakistan Agri-Expo.
“This event highlights the collaborative efforts in agriculture between our countries that spans more than five decades and continues today,” the US envoy said.
The expo, a two-day national agricultural exposition supported by the U.S. Department of Agriculture (USDA) and the United States Agency for International Development (USAID), showcases new agricultural farming technologies, products, and development programs.
The US Ambassador Cameron P Munter, Karachi Consul General William Martin, and the US Embassy Agricultural Counsellor Todd Drennan highlighted US-Pakistan agricultural cooperation during a visit today to the Dawn Pakistan Agri-Expo.
Ambassador Munter and Consul General Martin toured the USA Pavilion, where they met with companies that are implementing USDA- and USAID-funded programmes and are importing US agricultural products.
The USA Pavilion, under the theme of ‘Linking US Agriculture to the World’ highlights US-Pakistan institutional linkages and partnerships, which are introducing new technologies, farm equipment, and farming practices to the Pakistani agricultural sector.
The exposition, taking place in Karachi on February 11 and 12 and in Lahore on February 17 and 18, brings together exhibitors and participants from across Pakistan and the world from various business sectors involved with agriculture production and distribution.
http://www.thenews.com.pk/TodaysPrintDetail.aspx?ID=92246&Cat=3
The fertile alluvium deposited by the mighty Indus river and its tributaries in Pakistan have given the country’s demographic heartland of Punjab an agrarian edge. Yet, errant canal planning and over-pumping from tube-wells have degraded vast tracts of land. Salinity and water-logging afflicts around 6.3 million hectares of land and an additional 4,000 hectare of land gets affected every year (estimates from University of Agriculture, Faisalabad, Pakistan, November 2011). Climate change and conflicts over hydroelectric impoundment infrastructure have also made the arable lands of the country further vulnerable to flooding, as we saw in the epic floods of 2010 when an estimated 20 million people were displaced.
Amidst all these challenges to the farming economy of the country, there are glimmers of hope that Pakistan’s elite are trying to reconnect with the land in sincere and innovative ways. During my last trip to Lahore – the capital of Punjab province and Pakistan’s second-largest city (after Karachi), I was heartened to see urbanites retreating to farms in the surrounding countryside. Previously such farms were merely ornamental playgrounds of wealthy families but now there is a growing interest in these ranks to reconnect with the earth for societal good.
Zacky Farms, just outside Lahore, is the brainchild of Zafar Khan, a Caltech-educated software engineer who runs one of the most successful information technology companies in Pakistan named Sofizar. What started off as a recreational venture is now a side-business supplying sustainably produced organic milk, vegetables and meat to nearby Lahore suburbs. The farm is modeled on a cyclical model of minimal wastes and multiple product usage. The cows are fed pesticide-free oats, clover and grass and their manure is used to fuela biogas plant which runs the dairy facility. In an era of electricity load-shedding, such an alternative source of energy at a local industrial scale is immensely valuable to replicate as a development path. The residue of the biogas is used to fertigate the fodder fields and vegetable tunnels, which along with green manuring obviates the use of fertilizers. Free-range chickens grace the fields and there is even a fish farm on site. Zafar and his Ukrainian-born wife are committed to sharing their experiences with other farming entrepreneurs in the country.
Further south in a more rural and remote part of Punjab, famed writer and erstwhile lawyer, Daniyal Mueenudin, maintains a mid-size farm which is exemplifying other kinds of innovations. The farm does not boast ecological farming practices, apart from tunnel farming that can help with land conservation and humidity control. However, Daniyal has changed the social landscape of his area through implementing a “living wage” for all his employees. Noting the high level of inequality in Pakistan’s hinterland, the Yale-educated former director of the university’s Lowenstein Human Rights Clinic, is practicing what he preached. He also owns a farm in Wisconsin and could have a comfortable life in the States but his social obligations keep him ensconced in Pakistan for most of the year.....
http://newswatch.nationalgeographic.com/2012/02/23/farming-pakistan/
...Raising the wage several-fold for works and farm manager, and also offering bonus incentives for performance, has led to positive competition that can help to erode the feudal levels of income disparity which exist in this part of Pakistan. At the same time, Daniyal is also committed to providing new livelihood paths for the agrarian workers as automation reduces farm employment in some areas. He has has fully funded a school and provided a merit-based scholarship for advanced degrees to students from the nearby village. One of the children from this school (the first in his family to even go to school) is now making his way through medical school in Lahore!
Zafar and Daniyal’s stories of commitment to constructive farming for social and ecological good may appear to be outliers but they are catching on and provide hope to a country which is all too often shadowed by despair. In the suburbs of Islamabad, tax incentives and planning rules to encourage farming by urbanites are leading to a growing culture of reconnecting with the land in residential farms. In rural areas, the disaster caused by the floods of 2010 brought forth numerous aid agencies with new ideas for sustainable farming. The Pakistani diaspora, often known in the West for professions ranging from taxi-driving to engineering, may well find opportunities for reconnecting to their land in far more literal ways. With growing commitment from land-owners it just might be possible to use the existential shock of recent natural disasters that have befallen the country into a proverbial opportunity for positive change.
http://newswatch.nationalgeographic.com/2012/02/23/farming-pakistan/
in Africa:
Fatima Fertilizer Co. (FATIMA), Pakistan’s third-biggest maker of the farming ingredient, plans to build a new factory in Africa at an investment of about $1 billion to tap international markets.
The company expects to finalize plans this year to set up the factory, Fawad Ahmed Mukhtar, chief executive officer, said in a telephone interview from his Lahore head office. The fertilizer maker may consider forging a partnership by investing $200 million, he said, without elaboration.
Fatima registered its American Depositary Receipts in New York in March 2011 to raise its profile and expand overseas, aiming to overcome a chronic gas shortage at home. Pakistani fertilizer makers including Engro Fertilizer Ltd. and Fauji Fertilizer Co. get as much as 50 percent less gas than they need to run their factories, curbing production, according to Foundation Securities Pvt. in Karachi.
Fatima’s planned Africa factory may have a capacity to produce more than 1 million tons of fertilizer because the company expects to get “the best gas rates,” Mukhtar said.
“Besides local sales, we are also looking to export from there to Pakistan, Brazil and the markets in Africa,” Mukhtar said yesterday. To set up the plant Fatima is considering countries including Nigeria, Algeria, Tanzania and Mozambique, where there is “enough gas, which means that they will offer us good rates and good terms,” he said.
Fatima rose 1.6 percent to 24.90 rupees at the close in Karachi yesterday. The stock has almost doubled in the past 12 months, compared with a 10 percent gain for the Karachi Stock Exchange 100 Index.
Diversifying Risks
Companies in Pakistan including Lucky Cement Ltd., the nation’s biggest producer of the building material, are expanding overseas to cut dependence on their home market. Lucky will begin construction of a cement factory in Congo by June through a joint venture.
Expanding overseas will help companies including Fatima to diversify risks, according to Taha Khan Javed, manager research at Foundation Securities.
“Pakistan is facing a severe shortage of gas, so that takes away the feasibility to establish a plant here,” said Javed. “From Africa they can export anywhere in the world.”
The company will rely on a mix of its own cash, bank loans and investment from partners to fund the new plant, Mukhtar said. Fatima posted a net income of 4.12 billion rupees ($45 million) in the year ended Dec. 31, the first annual profit in four years after it started commercial operations in July.
The Danish Industrialisation Fund for Developing Countries and Haldor Topsoe AS, a Denmark-based maker of catalysts, have agreed to partner Fatima and will also help arrange funds, Mukhtar said, without specifying if they will collaborate on the African factory.
ADR Trading
“We are looking at projects internationally for setting up new plants and starting production in two to three years,” said Mukhtar. Depending on the “opportunity at hand,” Fatima may set up more than one plant overseas, he said.
Fatima Fertilizer’s ADR, each representing 50 local shares, may begin trading in the over-the-counter market in New York by June, Mukhtar said. Bank of America Corp. is the market maker, Bank of New York Mellon Corp. is the depositary, and Standard Chartered Plc is the custodian bank, he said.
http://www.businessweek.com/news/2012-03-13/fatima-fertilizer-plans-1-billion-africa-plant-to-grow-overseas
The exports of fish and fish preparations surged by 14.69 percent during the first eight months of current fiscal year (2011-12) against the corresponding period of last year.
The exports of fish and fish preparations were recorded at $195.284 million during July-February (2011-12) as against the exports of $170.274 million during July-February (2010-11), according to data of Pakistan Bureau of Statistics (PBS).
However, in terms of quantity, the fish exports witnessed nominal increase of 0.34 percent by going up from 74,265 metric tons to 74,518 metric tons.
On month-on-month basis, the seafood exports also witnessed positive growth of 13.88 percent during February 2012 when compared
to the same month of last year.
The fish exports during February 2012 were recorded at $21 million against the exports of $18.441 million during February 2011.
However, as compared to the exports of $21.401 million recorded during January 2012, the exports during February witnessed negative growth of 1.35 percent, the data revealed.
In terms of quantity, the fish exports increased by 5.57 percent in February 2012 when compared to the exports of February 2011, however decreased by 2.62 percent when compared to the exports
of January 2012.
The overall food exports from the country witnessed nominal increase of 0.59 percent during the first eight months by going up from $2.601 billion during July-February (2010-11) to $2.616 billion in July-February (2011-12).
The major food products that witnessed positive growth in exports included.
The food products that witnessed increase in exports during the period under review included rice (other than basmati), exports of which increased by 2.91 percent, fruits (15.02%), leguminous vegetables (1,315%), tobacco (37.85%), oil, seeds, nuts and kernels (59.84%), meat and meat preparation (16.46%) and other food products
(45.80%).
The commodities that witnessed negative growth in exports included basmati rice (17.78%), vegetables (36.69%), wheat (53.22%) and spices (1.49%).
The overall exports from the country during the period under review witnessed negative growth of 0.48 percent by going down from $15.263 billion to $15.189 billion.
Imports into the country, during the period, increased by 16.36 percent by going up from $25.600 billion to $29.788 billion.
Based on the figures, the trade deficit during the first eight months of the current fiscal year was recorded at $14.599 billion, against the deficit of $10.337 billion last year, showing an increase of 41.23 percent.
http://www.thenews.com.pk/article-42262-Pakistan-seafood-exports-surge-by-15pc-in-8-months
Karachi—Holland’s Ambassador to Pakistan Mr Gajus Scheltema disclosed that a powerful lobby of international fish exporters was strongly opposing the exports of fish from Pakistan to the European Union countries. Talking to mediamen in Karachi he said that the international fish exporters lobby was actively involved in creating obstacles in the way of Pakistan’s fish exports to EU nations.
When asked to name the lobby, the Dutch Ambassador said that the leading international exporters do not want to see fish exports from Pakistan. He, however, that Netherland was assisting the Balochistan government to develop Pasni Port and Fish Harbour that would help Pakistan to enhance fish exports to European Union countries. He pointed out that a firm, engaged in the exports of fish, had demanded license to export fish from Pasni to EU.
Mr Scheltema pointed out that the government of Japan had provided a grant of Rs800 million for the rehabilitation of Pasni Fish Harbour in Balochistan. Holland is engaged in rehabilitation of the harbour so that it meets the required international standards to export fish to EU and other countries in the world.
He said that the Japanese grant would be utilised for the procurement of a dredger; maintenance and dredging of the harbour; and extension and improvement of the breakwater.
Holland’s Ambassador further stated that his country could invest in agriculture, dairy and livestock in Pakistan. He said that Holland is one of the leading producers and exporters of dairy and livestock products in the world. He said that Holland and Pakistan should explore the agriculture, dairy and livestock sectors for mutual investment. Some Dutch companies are willing to explore avenues of investment in these areas in Pakistan and the companies could export agriculture, dairy and livestock products to European Union.
He said that Holland was keen to enhance trade with Pakistan and also supporting Pakistani business people who seek to export to the Netherlands. Scheltema said that their ‘Centre for Promotion of Imports from Developing Countries’ waseducating Pakistani exporters for improvement of their products to export level quality.
He said that Pakistan has a huge potential in agriculture and food processing sector and Holland is planning to invest in these sectors. He also pointed some trade hurdles in importing of cows and cattle from Netherlands to Pakistan.
He further said that Holland was willing to help government of Pakistan in promoting the wind energy in the country. He said that he had recently met the Federal Minister for Water and Power Syed Naveed Qamar and apprised him of the Dutch companies interest in developing wind energy projects in Pakistan.
Mr Scheltema said that Holland had strongly supported Pakistan in getting the GPS+ facility from the European Union that would help this country to enhance its textile exports share to EU markets. He said Holland was enjoying very cordial relationship with Pakistan and he was making efforts to strengthen the bilateral ties between the two countries. Holland plans to earmark 30 million euros for clean drinking projects in urban cities and some other water-related projects in Pakistan, he said. He said Holland had already worked in various water sector projects and keen to invest in water management, flood control, clean drinking water, waste water treatment and de-silting projects.
http://pakobserver.net/detailnews.asp?id=147970
Pakistani food companies made inroads to the UAE market at the Gulfood exhibition in February. The major groups held fruitful meetings at the exhibition and they will start launching their products from June onward, according to industry insiders.
K&N’s Foods (private) Limited, a leading name in poultry and meat products in Pakistan, is expected to market its products in the UAE by June. Brands in edible oil like Sufi Cooking Oil and Habib Oil, leading herbal trademark Qarshi and confectionery products leader Hilal, among others are also planning to enter the UAE food market this year.
“We are in talks with some leading groups and distributors to launch our brand in the UAE and we are confident to market our products by June,” Atiq R. Siddiqui, K&N’s head of exports, told Khaleej Times.
K&N’s Foods, which started its operation in 1964, is the first international brand in recent years, which has given permission to export frozen items to the UAE. The brand is considered a beacon for Pakistan’s poultry industry and its halal processed chicken, ready-to-cook and fully-cooked products are popular among domestic consumers.
“We have established the brand in Pakistan and now the company is ready to make a foray into the international market. The UAE will be the first international and regional market for K&N’s products,” Siddiqui said.
In reply to a question, he said Gulfood is a premier event for food industry. It is considered a good opportunity to interact with stakeholders to promote the brand and explore new business opportunities, he said.
“We showcased our products at Gulfood and received a good response from local businesses. We are in discussion with some leading names to launch our brand in the UAE market,” he said.
As many as 23 Pakistani companies in the food business attended the Gulfood exhibition in Dubai this year and displayed their full range of products in Pakistan pavilion. The exhibitors had fruitful meetings with the local importers and indenters and most of them are optimistic to launch their products at competitive price in the Gulf markets.
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Pasha said the volume of Pak exports to the UAE touched $1.8 billion in 2011 out of which food group exports were to the tune of $500 million. “There is, however enough room to expand keeping in view the UAE’s global food imports of more than $7 billion annually,” he said.
In reply to a question, he said some projects in food business are in the pipeline that will further strengthen the bilateral trade relations. “There are a few joint ventures ranging from farmland acquisition to joint production of commodities, fruits and vegetables and building of state-of-the-art food silos are in the pipeline,” Pasha said.
Asif Jabbar, director and group chief executive of Alif Investments, welcomed the entry of Pak brands into the UAE market.
“We have successfully launched many Pakistani brands including the Junaid Jamshed and Meat One. It is good to see that more Pakistani brands in food business are set to enter the local market,” he said and cautioned the new entrants about the stiff competition in the local market.
“The marketing of a new brand in the UAE is not an easy job amid competition from international and regional brands. One should be aware of marketing cost and other expenses in an international commercial city like Dubai to find place in the competitive market,” Jabbar concluded.
http://www.khaleejtimes.com/biz/inside.asp?xfile=/data/business/2012/April/business_April110.xml§ion=business
The State Bank of Pakistan has set Rs 285 billion target for disbursement of agriculture loan among small farmers for current fiscal year.
Director Development Finance of SBP Karachi, Dr Muhammad Saleem said this while addressing "Agricultural & Industrial Awareness Convention-2012" here on Tuesday.
Khyber Pakhtunkhawa Higher Education Minister Qazi Muhammad Asad Khan participated as chief guest in the convention organised by the State Bank, Rawalpindi in collaboration with commercial banks and insurance companies.
More than 120 stalls of handicrafts, clothing agriculture equipment, handmade beautiful jewellers, banking products and food, etc, were set up by women from various organisations and banks to promote rural culture and potential of trade in these areas.
Horse dancing and culture displays made this event more beautiful.
More than 1500 people including students, farmers and women participated in the convention.
Chief Manager State Bank Akhtar Raza, Group Head of United Bank Ltd (UBL) Jameel Ahmed, Vice Chancellor Hazara University Haripur, Professor Dr Sahawat and others were also present on the occasion.
Dr Muhammad Saleem said the SBP had set Rs 270 billion agriculture loans target for small farmers in the previous financial year while actually Rs 260 billion loan was distributed among farmers.
He said that agri loan is being given to farmers through one-window operation.
He said farmers could give better output if banks provide them loan in time on easy instalments.
"Agriculture is backbones of our economy and its share in Gross Domestic Product (GDP) is 21 percent.
Livelihood of 47 percent people is directly or indirectly is linked with agriculture sector.
The SBP is playing pivotal role in progress of agriculture sector by providing loans especially to small farmers," he said.
Dr Muhammad Saleem said the SBP formulates policy in consultation with all the stakeholders including farmers.
The SBP changes its policy with passage of time by keeping the necessities of farmers in view.
Addressing the convention, Khyber Pakhtunkhawa Higher Education Minister Qazi Muhammad Asad Khan said land of Haripur is fertile and the farmers of this area can give maximum production if they were given some financial support for seed, fertiliser and tractor and other inputs necessary for increasing production.
He urged the SBP to set up its branch in Haripur for promotion of small industries and agriculture sector.
About the Haripur University, He said Haripur has also become a part of the community of 120 universities.
"The government should increase budget for education to 4% of GDP.
The quality of education can only be improved by increasing the budget for this sector.
Group head of UBL, Jameel Ahmed said the State Bank has good legal framework and governance in the region.
The employees of the Bank are servants of people.
"It is your money and used to benefit you," he added.
Vice Chancellor Hazara University Haripur, Professor Dr Sahawat said knowledge-based economy and use of latest technology is of vital importance for progress of agriculture sector.
http://www.brecorder.com/agriculture-a-allied/183/1175388/
A rebound in rice supply from India and Pakistan this year will calm fears over food inflation faced by poor nations as cheaper grain from the South Asian neighbours corners a third of the global market.
South Asia’s ample grain stocks will help it undercut key traditional suppliers, as a populist scheme in Thailand prices its grain out of competition and high export floor prices in Vietnam deter some buyers.
India is likely to emerge as the world’s second largest rice exporter in 2012, selling around 7 million tonnes, while Pakistan’s shipments are expected to bounce back to about 4 million tonnes amid the high prices of rival Thailand.
“Indian rice supplies will act as a price stabilisation factor against high global food inflation,” said Tajinder Narang, advisor at a New Delhi-based trading company Emmsons International.
Global food prices rose in March for a third straight month with more hikes to come, the UN’s Food and Agriculture Organisation (FAO) said last week, with higher prices of oilseeds and grains contributing to the rise.
The FAO index, which measures monthly price changes for a basket of cereals, oilseeds, dairy, meat and sugar, averaged 215.9 points in March, up from 215.4 points in February.
Although the index level is below its Feb. 2011 peak of 237.9, it still exceeds the level during the 2007-08 food price crises that triggered global alarm.
After benchmark Thai white rice prices climbed to a record above $1,050 a tonne in May 2008, several nations, including India, put a ban on exports.
That left buyers scrambling for supplies, unleashing concerns over food inflation and the threat of unrest in poor nations in Africa and Asia. But high stock levels in India and Pakistan could help avert a replay this year.
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India’s exports this year are expected to jump 50 per cent from last year’s shipments of 4.6 million tonnes, according to data from the US Department of Agriculture. India had exported 2.2 million tonnes in 2010.
Neighbouring Pakistan, which is expected to ship 3.8 million to 4.0 million tonnes in 2012, or an increase of at least 19 percent from 3.2 million last year, is cracking new markets with the sale of 200,000 tonnes to China and unconfirmed exports to the Philippines through unofficial channels.
“When we got a setback from Iran, our exporters looked elsewhere and that has led to diversification,” said Javed Agha, chairman of the Rice Exporters Association of Pakistan, referring to the impact of tightening Western sanctions over Iran’s nuclear programme.
In Thailand, prices have spiked due to a government intervention scheme due to run until the end of June, that is paying farmers 15,000 baht for a tonne of paddy, lifting Thai rice export prices to $500-$560 per tonne....
http://dawn.com/2012/04/11/india-pakistan-rice-supplies-to-ease-agflation-fears-wa/
Presiding over a one-day ‘Farmers’ Financial Literacy & Awareness Program on Agricultural Financing,’ which was jointly organized by State Bank and Habib Bank Ltd. today at NRSP Training Center, Bahawalpur, he said the agriculture sector has a key role in country’s economy and stressed the need for making necessary finances available to farmers for multiple cropping activities. He outlined SBP’s efforts for creating awareness amongst the farming community and developing capacity of commercial banks through its various training and awareness programmes.
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Dr. Saeed Ahmed, Head, Agricultural Credit and Microfinance Department, SBP said the programme is aimed at creating awareness among the farming community about agriculture financing products & services offered by banks, money management techniques and lending procedures, documentations, etc. Besides, it would also develop capacity of agriculture field officers of banks in agri. financing and synergize the efforts of all stakeholders including policy makers, executing agencies, service providers & farming community to improve access to agricultural credit, he said, adding that SBP’s promotional initiatives and policy interventions have translated into around 200 percent increase in the flow of credit to the agriculture sector from Rs. 137.4 billion in 2005-06 to Rs. 263 billion in 2010-11.
However, he pointed out, despite this encouraging growth, the disbursement to the agriculture sector was around 40% of the total estimated credit requirements. ‘SBP has planned to increase the disbursement to 70-80 percent during the next five years covering 3.3 million borrowers by adopting a multipronged strategy,’ he added.
The inaugural session was followed by a technical session for the agricultural credit staff of banks in which senior officials of SBP and HBL made detailed presentations on dynamics of agriculture finance and related policies. The purpose of this session was to train the agriculture finance officials of banks enabling them to conduct farmers’ financial literacy programs at their end and to share the best practices in agriculture lending with the participants.
http://www.pakistantoday.com.pk/2012/04/12/news/profit/agriculture-can-farm-out-economy/
Sales of automobiles in the first nine months (July-March) of the current fiscal year increased 15 percent to 128,576 units, compared to 111,852 units same period last year, according to the data released by the Pakistan Automotive Manufacturers Association (PAMA).
According to the data, in the third quarter (Jan.-March) of this year, automobile sales increased 7 percent to 46,632 units from 43,753 units in the correspondent quarter last year. When compared with the second quarter of this year, sales in the third quarter showed an impressive growth of 22 percent.
Pak Suzuki Motor Company (PSMC) continued to depict strong sales showing a growth of 32 percent in the July-March period to 81,360 units compared with 61,693 units in the same period last year. Analysts attribute strong growth to the yellow cab scheme announced by the Punjab government. In March 2012 alone, PSMC sales stood at 11,198 units, up 16 percent from same month last year and 12 percent from February 2012.
On the other hand, Indus Motor Company sales growth remained subdued during the period under review. The company sold a total of 38,858 units compared to 37,259 units in the same period last year, up by 4 percent. In the third quarter, the company sold 14,792 units against 14,851 units in the same period last year.
Samina Kanji, an analyst at BMA Research, a 15 percent year-on-year growth in auto sales is primarily due to the yellow cab scheme of the Punjab government. On the other hand, motorcycles and three wheelers sales increased on month-on-month basis and sales in March stood at 70,671 units as compared to 65,011 an increase of 5,660 units, the data showed. Total sales of farm tractors decline to 6,229 units as compared to previous month sales of 8,906 units. Sales of trucks and buses sales in March stood at 379 units as compared to 304 units in February 2012.
http://www.thenews.com.pk/Todays-News-3-102452-Auto-sales-show-15pc-growth-in-nine-months
Telenor Pakistan, in partnership with the Government of Khyber-Pakhtunkhwa, will provide agriculture and livestock information to farmers in the province.
In addition, farmers will be offered the Easypaisa platform to trade in agricultural commodities. Information will be provided via push SMS, voice recordings and small community gatherings.
The aim is to benefit farmers — especially small farmers — by providing them relevant and timely information, and the ability to carry out related mobile transactions on their handsets. All information will be provided by the Government of Khyber-Pakhtunkhawa while Telenor Pakistan will act as the distribution channel of the information. A pilot project will initially be run in Mardan district.
To mark the occasion an MoU signing ceremony was arranged at a local hotel. Arbab Muhammad Ayub Jan, Minister for Agriculture, Khyber Pakhtunkhwa was the chief guest. The MoU was signed by Roar Bjaerum, Vice President Financial Services, Telenor Pakistan and Arbab Muhammad Ayub Jan, Minister for Agriculture, Khyber-Pakhtunkhwa.
Roar Bjaerum, in his comments, highlighted the benefits the project will bring to the farmers of the province. “We will provide farmers the information they need to grow better crops and to raise hardy livestock. By doing so, we want to help them make more informed decisions when it comes to agriculture and livestock planning and trading. This way we hope to contribute toward alleviating poverty and empowering farmers economically. We will also offer mobile branchless banking solutions to enable farmers to carry out transactions right on their mobile phones through Easypaisa.”
Ayub Jan in his remarks spoke about the partnership between Telenor Pakistan and the Government of Khyber Pakhtunkhwa’s Agriculture, Livestock and Cooperative Department (ALCD). He said: “The Department has the mandate of promoting the interests of agriculture and livestock farmers in the province of Khyber Pakhtunkhwa. It has undertaken various initiatives to modernize the sector, and to augment the dissemination of relevant information to farmers to help increase production. Our partnership with Telenor Pakistan is another step in this direction. We are ready to offer all the support it needs to achieve its goals for this project.”
Small farmers, living in far-flung areas, are usually isolated from market information which may help them in dealing with commodity whole sellers (‘beopari’ and ‘arthis). They also do not have immediate access to information about best practices in agriculture and livestock rearing.
Telenor Pakistan’s project will help farmers in getting the information they need to increase yield through access to best quality commodities, latest agri trends, information on judicious use of pesticides and fertilizers, best breed of livestock, new methods of disease control, and quality feed and fodder.
http://www.thenewstribe.com/2012/04/18/telenor-to-partner-with-kp-to-provide-agri-information-to-farmers/
The government intends to export 400,000 tons of surplus sugar and believes that the performance of the agricultural sector is improving despite natural calamities.
“The good news about surplus sugar was given to President Asif Ali Zardari during a meeting at the presidency by a delegation of the Pakistan Sugar Mills Association led by its chairman Javed A. Kayani,” president’s spokesman Farhatullah Babar said on Thursday.
The PSMA chief said sugar production stood at about 4.7 million tons. After meeting the domestic requirement of 4.2 million tons, about 400,000 tons of sugar is available for export. “Export will enable mill owners to make payments to growers in Khyber Pakhtunkhwa, Punjab and Sindh,” he said.
Sources in the agriculture sector said the country was exporting wheat and rice and sugar would be the third major commodity to be exported. They said the Punjab government was already exporting wheat and the centre was sending the surplus crop to Iran.
President Zardari expressed satisfaction over the sugar production and said: “It is a matter of great satisfaction that despite unprecedented natural calamities the country is not only in a position to meet its requirements but is also poised to export sugar.”
He said the government was committed to working in consultation with the sugar industry to solve its problems. “Only through the pro-active involvement of the business community and industrialists, the continuity of policies could be
ensured,” the president was quoted as saying.
He advised the government to hold a meeting with the PSMA so that its proposal to export sugar could be sent to the Economic Coordination Committee of the cabinet for consideration.
http://dawn.com/2012/05/04/plan-to-export-400000-tons-of-sugar/
All Pakistan Textile Mills Association (APTMA), with over 50 percent ($14.8 billion) contribution to the total national exports ($25 billion) and 78 percent share in the textile exports of the country, is the largest trade union of Pakistan as well as contributor to the national economy of the country.
Due to effective policies and leadership of APTMA, this year cotton production increased to 15 million bales despite two million bales lost due to floodwaters, as compared to the last year’s 11.7 million bales, thus making Pakistan self-sufficient in cotton sector for the first time in 10 years.
To rid the country of energy crisis, the association is actively engaged with various stakeholders, including the Sui Northern Gas Pipeline Limited (SNGPL), Petroleum and Gas Ministry and standing committees of the National Assembly. Out of 300 days, gas remained closed for 156 days causing loss of $5 billion cotton to production capacity of the country. Advocating the case effectively with the government, the association ensured five days a week gas supply to the industry, besides getting electricity load shedding exemption.
The association’s proposal of levying gas surcharge for gas exploration and laying of new pipelines was accepted. The APTMA leadership and members are also advocating for the Vision 2020 to resolve the gas crisis and sustainable growth of the energy sector, while clarifying how much energy is going to be produced from hydel, coal and other sources besides gas exploration. The association believes that only a futuristic vision can ensure affordable energy for the industry as well as domestic sector of the country.
APTMA group leader Gohar Ejaz said their strong advocacy for the free market mechanism during 2010-11 helped transfer Rs 400 million to Pakistani cotton farmers, equal to their income of eight years, and in the wake of price increase in the international market, remained the biggest contribution of APTMA for the welfare of the stakeholders. He said farmers got prosperity, which resulted in value addition to the crop and an increase of $5 billion export. While in 2011-12, resolving the energy crisis for the Punjab industry remained one of the biggest contributions of APTMA, he said.
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Research and development is the key to survival and growth of any industry. Realising this aspect, APTMA has made it a law to collect Rs 20 per cotton bale from the mills to spend this amount on research through Pakistan Central Cotton Committee (PCCC), a semi-autonomous body, with the federal minister for textile industry as its president. Last year, APTMA contributed Rs 300 million, as collected against the production of 15 million cotton bales in the country.
APTMA is also fulfilling its corporate social responsibility towards promotion of textile education in Pakistan. The association established textile colleges in Faisalabad, Karachi and other cities, which were later handed over to the government.
Established since 1957, APTMA is the premier textile industry association having 350 member mills and offices in Lahore, Karachi, Islamabad and Peshawar. Although textile sector has a total 14 associations of various stakeholders, APTMA is the only body, which is taking up the case of whole sector to provincial, national and international level for the growth of the sector – from farmer to exporters.
Textile industry contributes 8.5 percent of the GDP, while APTMA is 50 percent of 8.5 percent textile contribution towards GDP. APTMA provides direct employment to one million workforce as well as three million indirect jobs.
Pakistan is the fourth largest cotton producer in the world as 98 percent of 15 million cotton bales produced in Pakistan are consumed by APTMA members.
http://www.dailytimes.com.pk/default.asp?page=2012\05\07\story_7-5-2012_pg7_5
The low output also adversely affects capability of farmers to earn more, he added. Pakistan, which has been dubbed as a ‘great bread basket’ is struggling due to these factors and is now increasingly becoming an importer of a large number of agri commodities. At the same time, Umar said, Pakistan agriculture sector also faces huge post-harvest losses of 40-80 percent if compared with global benchmark. This double blow—low output and high losses, diminishes income of growers further, he maintained.
Similar is the case with agriculture credit facilities, farm mechanisation and availability of water, he said and added these structural problems need to be addressed. As against 20-25 tractors per square kilometres of arable land for global benchmarks, availability of tractor for Pakistani farmer has been about 10 times lower from this level.
Much to the dismay of farmers, he said, agricultural credit disbursed to farmers in Pakistan declined from $3.4 billion in 2007-08 to $3.1 billion in 2010-11. During the same period, Indian Agricultural Credit increased from $63.3 billion to $103.4 billion, he said. Agricultural credit in Pakistan is 8 percent of agri gross domestic product while in India, it is 31 percent of agri GDP.
Water, being main input for agriculture sector also failed to get attention as far as increasing its supplies for farmers, Umar said and added losses of water are as high as 40 percent before reaching farm gate. He stressed the need to plug these wastages on priority bases. He lamented that despite having tremendous strengths and opportunities, output of agriculture sector is simply pathetic. Our mangoes, citrus and basmati rice are the best in the world, he said and added 75 percent of arable land is irrigated, which is an unmatched blessing.
The real potential agriculture sector is not merely a dream, he said and added many progressive farmers are achieving these levels in various parts of the country. Progressive farmer yields are around 50 percent higher than average yields for the main crops , he said.
Emphasising efficient use of water for reaping optimal benefits, Umar said irrigating an additional 5.0 percent land can generate Rs 100 billion additional farm income.
Sharing his vision about farmer cooperatives, Umer said economy of scale in agriculture sector can be achieved by forming vibrant clusters of farmers. Unfortunately, he said, cooperative role model has been misunderstood in Pakistan and that is small land and animal holding leads to highly inefficient farming practices.
In sheer contrast, he said, Indian cooperatives contribute around 50 percent of the total agricultural credit disbursement and 60 percent of the sugarcane procurement is done by the cooperatives sector. In France, he maintained, 75 percent of all agricultural producers are members of at least one cooperative and cooperatives handle 40 percent of food and agricultural production.
http://www.dailytimes.com.pk/default.asp?page=2012\05\10\story_10-5-2012_pg5_16
Pakistan can easily triple its milk production by employing simple methods while latest measures can further milk output by 900 per cent.
Pakistan has impressive dairy industry which can be exploited to its real potential, said Economic Councilor Embassy of Netherlands, Ian Van Ranselaar here on Thursday.
He said a developed environment can help revolutionize Pakistan's dairy industry.
"A Dutch cow produces nine times more milk a Pakistani cow or buffalo can produce", he said and added that some measures are needed to bring per cow production of both friendly countries at par.
The Dutch diplomat was talking to Vice President Federation of Pakistan Chamber of Commerce and Industry (FPCCI) Mirza Abdul Rehman, Chairman Coordination Atif Akram Sheikh and Chairman Media Malik Sohail.
Ian Ranselaar further said that 16 Pakistani major dairy stakeholders are due to leave for Netherlands to know the latest trends and techniques.
He said currently balance of trade is in favour of Pakistan and they are working on various projects to boost Pakistan economy.
The diplomat said various Pakistani products including rice, textiles, surgical goods, sports hardware, leather products and fruits are of superior quality but local entrepreneurs lag behind in branding which has been identified as a major obstacle.
"Security situation in Pakistan is not as bad as perceived in many countries which is shying away investors. Pakistan should improve its perception", the diplomat remarked.
The Dutch diplomats were all praise for the tireless efforts of Pakistan Commercial Councillor in Hague.
On the occasion, Mirza Abdul Rehman said with 180 million population, Pakistan has great potential for investment, vast space for business activities and there is no issue of law and order.
Atif Akram Sheikh said both the countries have good political ties which should supplement our trade relations.
Pakistan has three times the animals that Germany has, but yields are one-fifth of Germany's and one-third of New Zealand, representing a significant loss, he added.
Business community is satisfied with the efforts of the Ambassador Hugo Gajus Scheltema, said Sheikh, adding that issuance of visa should be made easier.
Malik Sohail said being the fourth largest producer of milk in the world, Pakistan produces 35 billion liters of milk from around five million animals which is worth Rs.177 billion.
"Our dairy sector is growing by five per cent per annum while demand is increasing by fifteen per cent which calls for urgent measures to address issues effecting production", he underlined.
Pakistan is processing only two per cent of milk production which if increased will help boost living standard of rural population and economy.
http://www.brecorder.com/top-news/1-front-top-news/56904-pakistan-has-potential-to-enhance-milk-production-by-900pc-.html
This is a story affecting millions of Pakistanis — and it does not involve suicide bombings, honor killings, extremism or President Zardari's mustache.
"What would you like to be when you grow up?" I asked Sakafat, a boisterous 12-year-old girl, while visiting a remote Pakistani village in the Sindh province.
"A scientist!" she immediately replied. "Why can't we be scientists? Why not us?"
The confident Sakafat lives in Abdul Qadir Lashari village, which is home to 500 people in Mirpur Sakro. It is in one of the most impoverished regions of Pakistan.
There was a characteristic resilience and optimism in this particular village. This should come as no surprise to anyone who knows anything about Pakistan's often dysfunctional, surreal yet endearing daily existence.
The 500 villagers live in 48 small huts, except for the one "wealthy" family who recently built a home made of concrete. The village chief, Abdul Qadir Lashari, proudly showed off his village's brand-new community toilets, paved roads, and water pump that brings fresh water to the village.
These simple, critical amenities, taken for granted by most of us in the West, resulted from the direct assistance of the Rural Support Programmes Network, Pakistan's largest nongovernmental organization. RSPN has worked with thousands of similar Pakistani villages to help them achieve economic self-sufficiency.
I visited the Sindh village with RSPN to witness the results of using community organizing to alleviate poverty. The staff told me its goal was to teach villagers to "fish for themselves."
Every household in the Abdul Qadir Lashari village was able to reach a profit by the end of 2011 as a result of professional skills training, financial management, community leadership workshops and microloans.
Specifically, a middle-aged, illiterate woman proudly told me how she learned sewing and financial management and was thus able to increase her household revenue, manage her bills, and use a small profit to purchase an extra cow for the family. She was excited to introduce me to her cow, but sadly due to lack of time I was unable to make the bovine acquaintance.
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Asked what single thing she felt was most important most for her village, she replied education. Upon asking another elderly lady what she wishes for Pakistan, she repeated one word three times: "sukoon," which means peace.
When it was time to depart, the people of the village presented me with a beautiful handmade Sindhi shawl, an example of the craftwork the villagers are now able to sell for profit.
As I left the village with the dark red, traditional Sindhi shawl adorned around my neck, my thoughts returned to the 12-year-old girl, Sakafat, who passionately asked why she couldn't become a scientist.
I looked in her eyes and could only respond with the following: "You're right. You can be anything you want to be. And I have every confidence you will, inshallah ("God willing"), reach your manzil ("desired destination").
By focusing on education and local empowerment to lift the next generation out of poverty, Sakafat's dream could indeed one day become a reality for all of Pakistan.
http://www.cnn.com/2012/05/13/world/asia/pakistan-empowerment/index.html
Have you ever wondered where the milk in packaged dairy products comes from? In case you assumed that big food companies maintained their own dairy farms that generated thousands of litres of milk daily and remained insulated from fluctuations in open market rates, you are wide of the mark.
In fact, only 5% of about 1.2 million litres of milk that Engro Foods collects every day for its dairy segment during the flush season – from January to April each year when fodder is available in abundance and milk production is high – comes from its own corporate farm located in Sukkur.
The rest of the milk supplies during the flush season and the summer, when milk production drops by roughly 50%, comes from about 15,000 small farmers scattered between Sanghar and Jhang districts, an area of 135,000 square kilometres.
Streamlined under Engro Milk Automation Network (EMAN), Engro Foods maintains a sales force of 1,500 people across 1,200 villages in Sindh and Punjab. They collect milk, mostly in small quantities, from farmers between 6:00am and 9:30am every day, which is then transported for further processing.
But why would a villager with just a few cattle sell the excess quantity of milk to Engro Foods instead of the traditional milk contractors known as dodhis?
According to Aamir Khawas, who works as head of milk procurement and agri services at Engro Foods, doing business with a large food company offers small farmers a number of benefits. “Animals are susceptible to diseases. Our network of veterinarians ensures sick animals receive immediate treatment. That’s a benefit no traditional milk contractor can offer,” he said.
Moreover, the moment a farmer sells milk to an Engro representative, in whatever small quantity, the transaction is recorded electronically in a centralised database by swiping the EMAN card that each of the 15,000 suppliers carries.
The availability of real-time data ensures that money is transferred to the farmer the day the transaction takes place. This is in contrast to the past practice of issuing receipts on paper that took at least a week before a transaction was recorded and payment processed.
In addition, Engro’s advisory service helps farmers increase milk production. “There’re two ways for a farmer to increase his revenue. If he gets Rs41 instead of Rs40 per litre, his revenue increases by Re1. But if the milk output increases by one litre, his revenue increases by Rs40. We help him do the latter,” Khawas said.
So how does Engro ensure that the milk is pure? “It’s very easy. We pay farmers not on the litres of milk they bring to us. Rather, the basis of payment is total solid contents of the milk,” he said, explaining that milk consists of three things – water, fat and solid non-fat (SNF). Total solid contents are the sum of fat and SNF.
“It’s hard to adulterate when the quantity is low. So no matter how much water you add, the solid contents can easily be determined by running a few tests,” he said.
A total of 13 tests are carried out when a farmer hands over milk to an Engro representative. It is picked up from there by an Engro van that carries out another 20 tests on the collected milk. It then reaches the regional office where 30 more tests are done to check its quality. Eventually, milk is taken to the Engro plant where the final 40 tests take place before it is processed, packaged and dispatched to the retail market.
With the demand of milk increasing by 15% annually and supply rising by just 2% a year in Pakistan, the dairy sector looks like a heaven for investment. The Sukkur farm of Engro Foods has already grown 10 times since its inception with about 3,000 cows. “Yet we’re looking for a major expansion in the near future.”
http://tribune.com.pk/story/378282/the-benefits-of-business-with-a-large-food-company/
Farmers and traders in eastern Afghanistan say that despite a decade of foreign development projects, they remain economically dependent on their neighbors in Pakistan.
The main bazaar in the capital, Jalalabad is crowded with people buying and selling fresh melons, ripe tomatoes and sacks full of onions and potatoes. Fruits and vegetables from all across the country come to this market where it is sold to locals. But due to unreliable electricity and cold storage a lot of Afghan farmers' produce goes just across the border into neighboring Pakistan where it is stored and then re-sold.
"My name is Allah Mohammad," a local vegetable seller says introducing himself. He is selling his tomatoes from one of the many produce carts that line a busy road.
"We have heard there are no storage facilities and electricity. But in Pakistan they have facilities and electricity," he says.
Not far from the market, at the main loading station, onions and potatoes are being inspected and then loaded onto trucks headed for Pakistan. Gul Morad, head of inspection and regional chief for fruit and vegetable traders whose office is above the station says matter-of-factly, that cold storages do exist in the districts.
“Three to four years ago, USAID and DIA built us small cold rooms under the name ‘storages’ - but their capacity is only 4 to 5 tons. For these you have to use generators.” Morad explains. “Even if the generator stops for one hour, the room gets hot and the goods lose their quality.”
USAID says the deserted units do not appear to be theirs. The agency did however help fund Morad’s 24-ton cold-storage which he pays to maintain. The unit runs on both generators and power from the electrical grid and is a key part of the local economy.
Morad says most of time (when market prices go down) farmers and shopkeepers bring their produce here and store it for one or more days - for free. When the market gets better they take it out and sell it.
Local farmers and traders say proper refrigeration means higher profits, because they can store their own produce and make a better return in the off season.
However with too little cold storage, residents now rely on stored produce imported from Pakistan, which can sell for nearly triple the cost.
Many people, like farmer Ihsanullah from Ghawchak in Sukhroad district believe that some of the marked up vegetables are originally from here, but are imported into Pakistan, stored and then sold back into the Afghan market.
“Two things,” Ihsanullah says “potatoes and onions, they go from Kabul into Pakistan and are kept in storage and sent back to us. We sometimes work in the market so I am certain these two things are bought by big traders, stored and sent back.” He says, “our biggest problem here is that we don’t have storage.”
Inspection chief Morad disagrees and says the stored goods that come to Afghanistan are grown in Pakistan.
But both men agree that farmers and consumers both suffer from the lack of local refrigeration.
Agriculture is the main source of income for the country however Afghans say plans to develop the agriculture sector have not been realized. The Afghan government and the international community’s efforts to build sustainable storage and supply reliable electricity have not met expectations
http://www.voanews.com/content/competition_suspicion_refrigeration_afghan_market_products/667055.html
Nina Fite, consul general of the United States in Lahore recognised recent graduates of a US Agency for International Development (USAID) supported livestock export training programme at a certificate ceremony, a statement said on Friday.
The programme trained the participants in GlobalGAP certification, a standard for dairy and meat exportation required by several European and international markets. By implementing these standards, Pakistani meat and dairy producers will be able to export to wider markets, growing their businesses and boosting Pakistan’s economy, it said.
“The United States is committed to promoting the economic development of Pakistan. One important element of this commitment is our support to local farmers with programmes to build their business capacity and generate higher incomes – higher incomes that will improve their lives and the lives of their families,” said Fite. “Programmes, such as this USAID-funded training, will have a direct and positive impact on the lives of Pakistanis through the promotion of livestock entrepreneurship,” she said.
Global Good Agricultural Practices (GlobalGAP) is an international private body that sets voluntary international standards for the certification of agricultural production processes.
http://www.thenews.com.pk/Todays-News-3-109037-US-helps-Pakistan-increase-meat-dairy-exports
Nina Fite, consul general of the United States in Lahore recognised recent graduates of a US Agency for International Development (USAID) supported livestock export training programme at a certificate ceremony, a statement said on Friday.
The programme trained the participants in GlobalGAP certification, a standard for dairy and meat exportation required by several European and international markets. By implementing these standards, Pakistani meat and dairy producers will be able to export to wider markets, growing their businesses and boosting Pakistan’s economy, it said.
“The United States is committed to promoting the economic development of Pakistan. One important element of this commitment is our support to local farmers with programmes to build their business capacity and generate higher incomes – higher incomes that will improve their lives and the lives of their families,” said Fite. “Programmes, such as this USAID-funded training, will have a direct and positive impact on the lives of Pakistanis through the promotion of livestock entrepreneurship,” she said.
Global Good Agricultural Practices (GlobalGAP) is an international private body that sets voluntary international standards for the certification of agricultural production processes.
http://www.thenews.com.pk/Todays-News-3-109037-US-helps-Pakistan-increase-meat-dairy-exports
Mango farmers across Pakistan continue their partnership with USAID to maximise yields, improve product quality, introduce better packaging and create market linkages.
Seven mango farms from Sindh are already scheduled to send commercial shipments to high-end markets across the globe in June of this year.
All these advancements are helping Pakistani mango growers tap into new export markets with each passing season. As the mango season for 2012 begins, this partnership continues to bear fruit. Ghulam Sarwar Abro said a private farm in Kotri Sindh has been a partner with USAID’s Mango Programme.
“We are confident with USAID’s support, all of the ground work has been done. We have the required standards, infrastructure and linkages to tap the international markets on a competitive footing.” More farms will participate in commercial shipments as soon as harvesting begins in Punjab. USAID has signed Infrastructure Upgrade Agreements (IUAs) with 15 mango farmers across Pakistan on a cost-sharing basis to build pack houses.
USAID has also provided assistance to 15 farmers in achieving GlobalGAP certification under a similar cost-share agreement and has planned to increase this number by the end of this season by adding another 12 certified farms.
The USAID Mango Programme is currently in its third year and this year the programme is specifically concentrating on enhancing the market linkages for Pakistan’s mango sector.
He said this project is designed to help the Pakistani economy achieve its export potential. The project has three main areas of interest including an improved Pakistan trade environment through improved regulation, policies, systems and capacity, facilitation of trade at Pakistani borders and establishment of sustainable and competitive Special Economic Zones, including Reconstruction Opportunity Zones.
The project emphasises capacity-building activities that facilitate increased exports from industry, services and agriculture enterprises.
http://www.dailytimes.com.pk/default.asp?page=2012\05\25\story_25-5-2012_pg5_9
Pakistan’s largest hot water treatment plant for removal of various diseases in mango was inaugurated on Saturday. It has been established under the public-private partnership according to the standard of United States Department of Agriculture (USDA), World Health Organisation (WHO) and International Quarantine Standards by the name of Pakistani Horti Fresh Processing (Pvt) Ltd.
The project which was completed in record period of 20 months with its inception has helped to open three new markets for mangoes including Mauritius, Lebanon and South Korea while the Australia is expected to be approved soon which would greatly help boosting Pakistan’s mango exports during the coming ongoing season.
Pakistani mangoes have nine diseases in common, which was unacceptable in the international market but with the start of the operational activities of the new plant, importers have expressed their keenness to place large-scale order for the most desired fruit of the summer season.
It may be recalled here that majority of countries have placed strict conditions regarding import of fruits from across-the-globe and in case of mango, they have requirement of their hot water treatment on 48 degree centigrade for 65 minutes, which makes the fruit acceptable for import purpose.
Currently, Pakistan’s total average mango export stands at 150,000 tonnes which is hardly 8.0 percent of the total annual production of 1.6 million tonnes, which was usually attributed by the exporters on account of limited market access to Pakistani exporters.
Durrani Associates has established the project in collaboration with Ministry of Commerce. Its chief executive highlighting salient features of the project, said that the plant installed has the capacity to process 15 tonnes of the fruit per hour pn 48 C for 60 to 65 minutes.
Similarly for the first time, Ethylene Chamber facility was also used which give colour to mango by food graded Ethylene having no harmful impact on human health as compared to carbide which is widely used in the country for ripening fruit and is spelling harmful diseases for fruit consumers.
He claimed that the biggest breakthrough created by the Pakistan Horti Fresh processing is that now mangoes can be shipped by sea for destinations as far as UK and Canada with shelf life of 35 days.
As compared to by air freight of mangoes to UK which costs Rs 137 per kilogramme (kg) charged by Emirates Airline, the new technology would cost a mere Rs 12 per kg, which would herald new life in exports of fruits to different countries across the globe.
http://www.dailytimes.com.pk/default.asp?page=2012\06\10\story_10-6-2012_pg5_14
Pakistan produces over 150 varieties of mango and among these Chaunsa and Sindhri have great potential for finding buyers in the international markets.
Talking to APP on Monday Secretary Agriculture Punjab Muhammad Mushtaq Ahmed said Punjab holds 67 percent of the total area and produces 80 percent of country's mango.
He said total production of mangoes in Punjab during 2011-12 was 1.304 tons and Pakistan is of high quality with good aroma, excellent appearance, special taste and flavor along with sufficient quantity of fiber content thus enjoying a prominent position in the international market.
To a question, he said Pakistan produces over 1.75 million tons of mangoes out of which 127 tons are exported, currently only 5 percent of the total mango produce is processed in to value added items like pulp for use in drinks and ice cream, canned mangoes and dried mangoes.
He said Pakistan exported mangoes worth $ 29 million to the Middle East and EU in 2009 and Malaysia, China and Hong Kong are other valuable trading partners.
http://www.brecorder.com/pakistan/business-a-economy/68148-pakistan-produces-over-150-varieties-of-mango-.html
Five large banks collectively disbursed agri. loans amounting to Rs 146.3 billion or 103.7% of their annual target (Rs 141 billion) in fiscal year 2011-12, higher by 4.3% as compared with Rs 140.3 billion disbursed during the preceding fiscal year (FY2010-11). National Bank of Pakistan (NBP), Habib Bank Limited (HBL), MCB Bank, Allied Bank Limited (ABL) and United Bank Limited (UBL) have surpassed their annual targets by achieving 106.0%, 103.5%, 103.3%, 102.8% and 100.7% disbursement respectively. Zarai Taraqiati Bank Limited (ZTBL) disbursed Rs 66.06 billion or 94.2% of its annual target of Rs 70.1 billion while Punjab Provincial Co-operative Bank Limited (PPCBL) by disbursing Rs 8.5 billion or 112.1% has surpassed its annual target (Rs 7.6 billion) during FY 2011-12.
Fourteen Domestic Private Banks as a group achieved 112.5% of their target (Rs 54.1 billion) by disbursing agri. loan of Rs 60.9 billion. The Bank of Khyber, Bank Al Habib, Faysal Bank, Soneri Bank, NIB Bank and Askari Bank have surpassed their annual agri. credit disbursement targets by achieving 174.6%, 147.6%,136.7%,132.4%,104.1% and 100.4 % disbursement respectively while other remaining banks could not meet their annual targets.
Five Microfinance Banks as a group disbursed agri. loans of Rs 12.1 billion or 99.3% of their annual target of Rs 12.2 billion during FY 2011-12. It may be pointed out here that the banks had been missing the agri. credit disbursement targets since 2008-09. Achievement of agri. credit disbursement target during the year ended June 2012 was extremely difficult in the backdrop of continuous declining trend in the overall Private Sector Credit and high agri. Non-performing Loans (NPLs) of major banks due to devastating floods of 2010 and heavy rains of 2011 in Sindh province. However, SBP adopted a multi-pronged strategy and made all out efforts in achieving the target of Rs 285 billion allocated by ACAC. The efforts of SBP officials not only helped banks in achieving their target but also surpassing it.
These efforts included swift settlement of crop loan insurance claims, close co-ordination with provincial revenue departments to facilitate the One Window Operation in agri. intensive districts for timely completion of revenue formalities, holding of farmers' awareness and financial literacy programs at grass root level, and follow up of targets with the top management of banks and their agri. Heads. The contribution by SBP BSC field offices in monitoring the regional targets was also greatly helpful.
FOREIGN INVESTMENT IN AGRICULTURE
Food is the first priority of the mankind which offers potentially enormous resources in agriculture to cater to the food requirement not only of the country but of the countries in the region. At the moment the oil rich Arab countries are confronted with food security problems and looking for investment in agriculture lands abroad.
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In Pakistan land About 25% of Pakistan's total land area is under cultivation and is watered by one of the largest irrigation systems in the world. Pakistan irrigates three times more acres than Russia. Agriculture accounts for about 21.2% of GDP and employs about 43% of the labor force. In Pakistan, the most agricultural province is Punjab and Sindh where wheat and cotton are the most grown. However rich lands with honey and milk are still awaiting for development both in Sindh, and Punjab.
http://www.equities.com/news/headline-story?dt=2012-07-24&val=300443&cat=material
The establishment of Karachi’s hot water treatment (HWT) plant – a facility for post-harvest treatment and processing of fruits and vegetables – is a very good example of how the country’s agriculture sector can benefit by investing in technological advancements. It is because of this technology that Pakistan has been able to venture into some of the world’s largest markets for its mango over the past couple of months.
In order to expand mango exports, Durrani Associates, one of Pakistan’s largest mango exporters, in partnership with the government, set up the Rs220 million HWT plant, which is officially known as Pakistan Horti Fresh Processing (Pvt) Limited. This investment, according to Durrani Associates’ Director Babar Khan Durrani, can be recovered within five years.
Durrani told The Express Tribune that they were already exporting mangoes to Tesco in the United Kingdom and Carrefour in the rest of Europe – two of the world’s largest retail chains – but HWT facility has opened new markets for the exporters. The exporters can use the facility and ship their products via sea now, which will enable them to sell at competitive prices.
HWT increases shelf life of mangoes to 35 days, thus they can now be shipped by sea to remote destinations, a major development, which reduces freight charges to a great extent.
Take the example of China, Durrani said, where air freight alone costs more than $1.25 per kg of mangoes. The processed mangoes can be shipped by sea, he said, bringing the cost down to $0.20 per kg. As a result, the Pakistani exporter was able to impress Walmart China, which, in a week’s time, will strike a contract for supply of another 100 tons of mangoes.
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Talking about how this technology has helped expand mango exports, Durrani said fruits and vegetables processed by HWT facility meet requirements of the United States Department of Agriculture (USDA), World Health Organisation (WHO) and International Quarantine Standards, thus making them globally acceptable.
In the past, Pakistan’s mangoes were denied access to several key markets including the US and China because of nine diseases. HWT kills anthicolas, a major disease that results in black spots on mango skin.
“The skin of our mango is rough but its taste is very good,” company’s Chairman Abdul Qadir Khan Durrani said. “HWT improves the skin while killing all diseases after treating at 50 degrees for an hour,” he added.
He claimed Pakistan has world’s largest HWT plant having capacity to treat 15 tons of mangoes per hour. The second largest plant is in Mexico that treats 4.5 tons of mangoes per hour, he said.
Besides the $2,200 per ton market of Europe, the $1,600 per ton market of China could prove to be the largest importer of Pakistan’s mangoes, Durrani said.
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By contrast, the mango exports are 8% of the production or less than 50% of the export potential, a strong indication that there is still a huge space for more investment on the technology front. “We need more than 10 such plants for meeting mango demand of North American markets,” Director Durrani said.
“Our agriculture sector lacks technology. People shy away from using technology.” It will take a while before all farmers adopt new technologies, he said.
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“About 30% to 40% of our fruits and vegetables are wasted because they are not processed,” Durrani said. “Given the HWT plant can process almost every fruit and vegetable that we produce, we can save our produce from being wasted,” he added.
http://tribune.com.pk/story/424992/fountain-of-youth-technological-progress-boosts-demand-for-mangoes/
Following the rising demand and better price in the world market, Pakistan''s wheat exports has again picked up, witnessing some 200 percent growth during the first month of the current fiscal year. Exporters told Business Recorder on Wednesday that after posting some decline in the second half of FY12, wheat exports surged, on the back of demand from Sri Lanka and some other regional countries.
"Pakistan''s wheat exports was declining a few months ago because of low prices. However, better wheat prices and rising demand in the world market have opened up new venues for the export of the commodity," exporters said. Wheat price in the international market was rising because of reports regarding bad wheat crop in Russia, they said.
According to them, wheat prices had crossed $300 per ton after a gap of 6-8 months. Month-on-Month basis, export statistics for the first month (July) of this fiscal year were very encouraging, as wheat export witnessed a massive growth of 198 percent.
Keeping in line with the current trend, wheat exports amounted to $4.652 million in July 2012 against $1.562 million in June this year, depicting an increase of $3.09 million in a single month. In term of quantity, some 15,521 tons of wheat was exported during July against 5,592 tons in June this year.
Export figures for August will be higher than July, as huge export orders have been placed by foreign buyers and several shipments are in the pipeline. However, in the longer run, exports were linked with price stability in the world market, they added. "We are exporting wheat without any government subsidy, disposing off excess stocks, earning millions of dollars in foreign exchange. Wheat price below $300 per ton is not visible for us," exporters said.
The quality of Pakistan''s wheat is best and as per international standard it has 11 to 11.5 percent protein content and is considered perfect for markets in Sri Lanka, Bangladesh, the Gulf states, Far East and Myanmar, they informed. Traders also confirmed that commodity exporters were quickly procuring wheat from domestic market for export as attractive prices are being offered by importers from around the world.
Expressing some reservations regarding wheat exports, they said that hasty buying of wheat from domestic market could create panic in the commodity market, resulting in a massive increase in wheat pries. Wheat prices have witnessed a surge of Rs 2,000 per ton over the past month because of huge buying by exporters. With the current rise, the price of wheat grains rose to Rs 28,000 per ton from Rs 26,500 per tone. Although, the country harvested a bumper wheat crop this year and there is an ample stock in government and private warehouses, extraordinary jump in the quantum of exports could hit domestic prices and wheat availability in the domestic market, traders said.
http://www.brecorder.com/agriculture-a-allied/183/1229620/
The United States Agency for International Development’s (USAID) Firms Project has successfully trained 449 peach farm SMEs in Swat, Pakistan under a USD 600,000 revitalization program, that aims to facilitate them in gaining access to greater revenues and market linkages; and make overall infrastructure improvements to strengthen the sector.
Swat relies heavily on the horticulture sector with 67 percent of the total peaches produced in Pakistan coming from Swat. In recent years however, calamities have wreaked havoc on agriculture, affecting sales and jobs in the region. The main constraints to growth include lack of infrastructure, poor access to inputs, market linkages, credit facilities, untrained workforce, and poor management practices affecting the quality and yield of the produce.
USAID’s assistance to the Pakistan's peach sector includes trainings, infrastructure, supplies, technical support, tools, and certifications for peach farm SMEs of Swat, under a cost sharing agreement. 449 peach farm SMEs that signed agreements with USAID Firms Project earlier this month received pre and post harvest trainings as part of the capacity building component of this assistance. 150 SMEs have received in-kind support in the form of pruning kits, harvesting kits, and corrugated cartons. Distribution to the remaining 299 will finish by the end of July. The tools and equipment will help ensure minimum damage to fruit during harvest, thereby reducing losses to the growers. To coordinate the effort, cluster leaders have been appointed who ensure a smooth flow of operations with farm SMEs within their clusters and work with them to increase output.
Together these interventions will help peach farm SMEs in adopting best management practices and peach farming techniques, attaining larger scale production, increasing yield, and tapping into competitive new markets. Atta Ullah, a local peach grower from Swat said, “These pruning and harvesting kits and all the other assistance from USAID will benefit the smaller farms and increase the revenue for these SMEs by 10 percent.” Another grower explained “We have learnt so many things we can do better. The training brings new management practices to us and is helping us access gains which were not possible before”.
To further strengthen the sector, USAID Pakistan Firms Project is providing assistance to these SMEs for competitive marketing and product placement, and creating linkages between SMEs from Swat and large-scale buyers and retailers. An existing peach pulping unit in Swat will also be up-graded with modern infrastructure to meet the demand of peach pulp.
http://www.freshplaza.com/news_detail.asp?id=100449
The exports of Pakistani citrus have registered an increase of 70 per cent in a year, Minister for Commerce Makhdoom Amin Fahim told National Assembly on Wednesday.
In a written reply to the question of Ms Nighat Parveen Mir, he said the exports of citrus have been increased up to US$162.6 million from July to March in the year 2011-12 compared to US$95.8 million during the corresponding period last year.
The country has also exported 247,909 metric ton mangoes to various countries from 2008 to 2010-11. In the year 2008-09, as many as 73,437 metric ton mangoes were exported, while 84,921 MT mangoes were exported in 2009-10, and 89,551 MT mangoes were exported in 2010-11.
In a written reply to another question he said, European Union – the union of 27 European countries is the largest business partner of Pakistan. EU had already announced concession on 75 products for Pakistan subject to waiver. The matter is now with European Parliament for legislation before implementation. Pakistan is making diplomatic efforts for getting concessions on 75 products.
He said Pakistan will qualify for duty free access to EU from January 1, 2014 as the country has ratified all the 27 international conventions.
In reply to another question he said, Pakistan and India are in the process of normalizing bilateral trade relations under resumed composite dialogue. As a first step, negative list of 1,209 tariff lines have been notified.
With the phasing out of negative list by December 31, 2012, complete trade normalization with India will be in place subject to the removal of the non-tariff barriers by the Indian government.
In written reply to question he said, country’s imports stands at $34.82 million during 2008-09, $34.71 million in 2009-10, $ US 40.41 million in 2010-11, and $44.91 million in 2011-12.
The volume of trade between Pakistan and Africa was $2.4 billion and $3.09 billion respectively.
http://dawn.com/2012/09/05/citrus-exports-register-70-percent-increase-in-one-year/
Tractor manufacturers have more than 10,000 tractors of various makes in their stocks for immediate delivery under the Punjab government's Green Tractor Scheme 2012-13 to the farmers before sowing of Rabi crops, a senior tractor industry executive told Business Recorder, here on Friday.
The Punjab government has completed the process of providing 10,000 tractors to farmers through transparent computerised balloting of 0.275 million applicants of 18 to 35 years age having land holding of 2 and a half acres to 25 acres irrigable and 50 acres arid land across the province. The Punjab government is providing subsidy of Rs 200,000 on each tractor. The provincial government has so far provided 30,000 tractors during the past four years under the Green Tractor scheme to the small farmers with a subsidy of Rs 6 billion to boost agriculture production in the province.
The executives said though the auto manufactures have increased prices of cars t recently yet the tractor industry is not only maintaining June 2012 prices but also giving one percent discount on the sale of tractors under the Green Tractors Scheme. They however suggested that the government should not delay payment of Rs 200,000 to the tractor manufacturers given as subsidy on the Green tractors. The prices of tractors manufactured in Pakistan are still the most competitive in the region despite severe electricity load-shedding and increased cost of production, they emphasised.
They said that small farmers suffered huge financial losses due to rain floods in Sindh and Balochistan in the out-going monsoon season this year, therefore the government should not increase the proposed rate of General Sales Tax from 5 percent to 10 percent in January next year as it would put an additional burden on the agriculture sector.
They said that the tractor industry sold 5,675 tractors in the first two months of the current financial year as against 2,000 of the previous year. President Farmers Associates of Pakistan (FAP) Dr Tariq Bucha has appreciated the Punjab government's Green Tractors Scheme and said the government should make immediate arrangements for delivery of the tractors to the lucky farmers so that they could be used them for preparing the fields before sowing of the Rabi crops seeds in time. Bucha demanded of the government to also provide subsidy and reduce the rate of GST on accessories such as trolleys, ploughs, etc.
http://www.brecorder.com/agriculture-a-allied/183/1245125/
ISLAMABAD: All arrangements have been finalized to hold balloting of Benazir Tractors Scheme to provide subsidized tractors for growers.
The balloting for the scheme is expected to be held on September 6.This was stated by the Federal Minister for Food and Agriculture (MinFA), Nazar Muhammad Gondal responding to the live calls of the people after inaugurating the radio programme “Aaj Mandi key Bhao”, here on Monday.
The minister said that preparations had been finalized to provide 10,000 tractors to farmers under Benazir Tractor Scheme.
It may be recalled that about 355,000 printed application forms had been provided to farmers through the ZTBL branches in addition to those who applied on-line.
About 340,000 application were received, of which 277,106 were finalized for balloting of the scheme.
For Punjab province 5000 tractors, Sindh 2000, NWFP 1200 and for Balochistan 850 tractors would be allocated.
In AJK, FATA 350 tractors each while FANA 200 tractors and Federal Capital 50 tractors quota is fixed.
http://www.pakistantimes.net/pt/detail.php?newsId=3863
Almost a year after floods devastated Pakistan, swamping 5.8 million acres of farmland and displacing millions of people, Ashaq Malik, who grows cotton, sugarcane and wheat on 865 acres in Punjab province, has reason to feel optimistic. After nearly a third of his land was inundated, today he is seeing a strong harvest. "As soon as the water level fell down, we started reconstructing the houses and working on the fields," says Malik. "Today there is no problem with the crops."
Companies that service the agriculture sector are also thriving in the rebound, none more than Millat Tractors of Lahore, which also manufactures other farm gear. Last year Millat earned 2.3 billion rupees ($29 million) on sales of $263 million, a 40% increase from the previous year. In the first quarter of 2011 profits grew 52% from the same period a year earlier..
To buy his 150,000 shares, Ansari--then a 39-year-old general manager--sold a plot of land, liquidated his retirement funds and borrowed money from his father. "It was a lot of money to me back then," he says. "Today it's like a lottery coming your way. The value has increased many, many fold since then."
Today the public, including Millat's 1,600 employees, owns 42% of the company; management and kin 28%; and banks and other institutions the rest. Employees are prosperous because of stock dividends and their salaries. Most of Millat's employees pay income tax--a sign of affluence in Pakistan--and have their own cars.
..
http://www.forbes.com/global/2011/0912/best-under-a-billion-11-millat-tractors-pakistan-after-flood.html
Operating in this region since 1989, the Sarhad Rural Support Programme (SRSP) has quietly pioneered a model of development suggesting a viable pathway for transition to sustainable, post-carbon prosperity. The model is based fundamentally on participation of the marginalised rural poor at all levels — as planners, designers, implementers, and maintainers. Grassroots communities are empowered to self-mobilise into local community organisations which then become the vehicles of building ‘self-help capacity’, identifying the needs of households and procuring the training, skills and resources to undertake diverse development projects.
One of the SRSP’s flagship projects involves micro-infrastructure. So far, the impact has been astounding. Over 4,028 small-scale projects have been planned, delivered and maintained by communities themselves across the region, establishing micro-hydroelectric plants that allow communities to finance their own development — in turn generating new local jobs and service providers, clean water and sanitation schemes, farm-to-market roads, and new opportunities for small-scale agriculture.
Farming communities utilise water from the hydropower plants, diverting it to fields for kitchen gardening, multi-cropping and fish ponds. As the plants store rain and river water, they also provide effective disaster mitigation against monsoon rains and flooding. Through such projects, SRSP has enabled 308,540 men and women to, literally, transform their own lives.
In the Swat valley and Chitral district, for instance, SRSP has played a leading role in providing emergency humanitarian relief to local communities affected by floods in recent years. While this has involved providing tents, food packages and essential household non-food items, it has also involved longer-term recovery programmes to rehabilitate and strengthen local livelihoods.
SRSP staff began these programmes with extensive consultations with the local communities, many of whom had lived without electricity for nearly 60 years. Based on their vision and aspirations, households were organised into local community organisations, which determined the projects they needed and began implementing them. With SRSP bringing in some external funding from outside donor agencies, local communities provided the rest through a combination of in-kind contributions in terms of cash, labour and local materials.
Just this month, in the remote village of Mian Jair Wajoor Bandai in Swat, SRSP oversaw the completion of the village’s first 20 kilowatt micro hydro-electric power plant, producing electricity and 24 hour hot water for over 80 households. In September, a similar but larger project was inaugurated in the Kalash valley in Chitral, with a 200 kilowatt plant, meeting the energy needs of over 7,000 people across six villages.
One local Kalash resident from the village of Bumbarate, student Shah Nawaz, recounted the impact:
“At last we have come out of the darkness. For me, my joy knows no bounds as my friends from other areas would do their research on the internet and download study notes of an international standard, but here we could not. Now I’ll also be able to connect to the internet and will have an opportunity to do online research.”
Another resident and local elder, Abdul Aziz, explained that the government had neglected local facilities in the valley.
“We have spent our whole life in the darkness. We would face many problems when we traverse these hilly areas, and one can easily slip down. But now we will have so many benefits. Our children will study in the night and we will carry out domestic chores in lights.”
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So successful is this model, it has been widely replicated in developing countries. .
http://news.yourolivebranch.org/2012/12/23/pakistans-rural-poor-on-path-to-post-carbon-prosperity/
Pakistan's first state of the art potato washing and grading machine was installed in Karachi and is hoped to boost the dwindling export of potatoes.
The machine was imported at a cost of Rs 10 million and is of Indian and Mexican construction.
Abdul Wahid a leading fruit exporter and former Chairman of All Pakistan Fruit and Vegetable Importers and Exporters Association said that, despite bumper crops, a lack of modern processing and grading of the potato hindered its export.
The lack of modern equipment, for washing, for one thing, has limited export to a few markets, including Sri Lanka, Malaysia and some Gulf Countries.
The lucrative European, Central Asian and Russian markets have so far remained out of reach, with few exceptions.
The new machine is thought to be the first in the country that will wash and grade the potatoes, preparing them to a standard suitable for international trade.
To have a real impact there will need to be many more such machines imported into the country.
http://www.freshplaza.com/news_detail.asp?id=105326
I have a serious problem with the cynic brigade that writes and comments on social, developmental and political issues along familiar lines. What is their familiar line? The Taliban are coming, extremism is on the rise, corruption is pervasive and life is miserable. This is a partial truth, not the whole truth. That nothing can change is a viewpoint that conflicts with history and the evolution of societies.
Cynicism in hard times like ours and in a climate of fear, insecurity and violence, sells and viewers and readers readily embrace the dark side of things rather than looking at what is bright and shining. The other issue is the habit of most of my colleagues and columnists to write from the comfort of their offices or homes. They tend to look at the big picture that gives a disturbing spectre rather than examining achievements at local levels, and by dedicated individuals and communities. If there is any meaningful and real change in Pakistan, it is taking place at these levels in every aspect of the social and economic life of this country. By missing details of development and positive change at the smaller scale, we may draw a big picture of a society and country that may not be in agreement with reality. This is what is unfortunately happening.
One of my social beliefs is that only by changing at the local level will Pakistan change for the better at the national level. The national in spatial terms is nothing but local. By often travelling through the villages, mostly in Punjab, I have seen thousands of positive contributions and developments that are neither documented nor narrated. Never has our regular cynic brigade opened its eyes and minds to what this change is and how it is becoming a catalyst for more and larger changes.
Let me share one man’s gigantic contribution at a government agricultural research farm in Bahawalpur. I had heard about Mushtaq Alvi for his collection of berries and date palm trees for some years. Last weekend, I had the opportunity to visit this fabulous farm, which may not be noticed from outside the walls. Mr Alvi, as a young man with his first job, started the plantation in 1985. He went to every place in Pakistan to collect the best local species of date palms, berries, mangoes, guavas and pomegranates. Today, he has 35 species of date palms, 20 of berries, 20 of mangoes and five of pomegranates, and almost every of guavas. Never has his search for new findings ended.
While the collection continues to expand, the farm has supported thousands of farmers and households that would like to have various species of these trees. Every season, thousands of berry plants and hundreds of date palms are distributed. Then there are private collectors of these trees that have developed their own farms and would like to sell plants to new farmers. Each new tree becomes a source for saplings leading to further proliferation.
Scientists like Mr Alvi and many of his colleagues may move on to other research stations or retire but what they have done is something remarkable. This is just one example of ordinary Pakistanis making a difference to society. Unfortunately, our media, commentators and pseudo intellectuals cannot lift their eyes from what is wrong in society and shift their attention, even for a moment, to what is right and working.
Recognition and celebration of achievements by individuals and communities encourages positive change, positive attitudes and stimulates energies for innovation and more contribution. While grieving about the many things that are troubling us, let us not ignore the pleasing side of changing Pakistan. Go out and see it.
http://tribune.com.pk/story/509088/changing-pakistan/
The Asian Development Bank (ADB) has announced $ 200 million assistance for Benazir Income Support Program (BISP) so that it may reach out to the families not benefiting its various schemes. The announcement was made recently while a delegation of the bank was visiting the country with a special objective to look into the areas where the social safety, extended over the poverty-stricken people of the country four years back could be helped out.
Due to transparency and effective utilization of the funds, BISP has received direct technical and financial support from international donors. World Bank, Asian Development Bank (ADB), UK Department for International Development (DFID), USAID, China, Turkey and Iran has doled out funds to support different BISP initiatives. Some countries in the Asian regions, including India, have approached Pakistan for replicating BISP model. BISP conducted countrywide Poverty Survey/Census for the first time and collected the data of almost 180 million people and 27 million households using GPS devices for the informed decision making (to cope with natural disasters and other emergencies). The poverty census completed in record time of one year across all Pakistan including Azad Jammu & Kashmir, Gilgit-Baltistan and FATA.
BISP took start with Rs34 billion (US $ 425 million approximately) for the financial year 2008-09 aiming to cover 3.5 million poorest of the poor families. The allocation for the financial year 2012-13 is Rs. 70 billion to provide cash assistance to 5.5 million families, which constitutes almost 18% of the entire population. The Program aims to cover almost 40% of the population below the poverty line.
More than 7 million beneficiary families have been identified through Poverty Scorecard Survey for disbursing Rs1000/month through ‘branchless banking system’ (Smart Card, Mobile Phone, and Debit Card). Called as Martial Plan and having focus on poverty alleviation through empowering the women, BISP has so far disbursed more than Rs146 billion to the deserving and needy of the country with complete transparency in about 4 years time through the elected representatives of the people, regardless of their party affiliation.
Waseela-e-Haq provides interest free loans up to Rs 300,000 to help recipients set up small businesses. The most striking feature of this program is that the female beneficiary is the sole owner/proprietor of the business and the counseling, monitoring and training for starting the business is provided through Pakistan Poverty Alleviation Fund (PPAF).
Waseela-e-Rozgar has been launched for provision of demand-driven technical and vocational training to the deserving youth, who do not have any skill, through public/private training institutes. A total of 10,000 young males and females have been trained and another 20,000 are currently undergoing training. The target is to train 150,000 students every year.
Besides helping the poor and the marginalized sections of the society in terms of income support and skill development, the BISP is providing insurance cover of Rs.100, 000 in the case of the death of the bread earner of the poor family registered with the authority. With a view that health shocks are the major reason for pushing people below the poverty line, Rs25000 health insurance is being provided to the poorest families for the first time in Pakistan. Pilot phase has been launched from Faisalabad.
Finally, as the Poverty Survey had indicated, millions of poor children never attend any school due to financial limitations. BISP has signed contracts with all the provinces, under its Waseela-e-Taleem Program, initiated with generous help of the World Bank and DFID, to send 3 million children to school through additional cash incentives of Rs.200 per child....
http://www.dailytimes.com.pk/default.asp?page=2013\03\21\story_21-3-2013_pg7_15
The Pakistan People’s Party on Saturday released a 29-point report on its five year performance, highlighting major achievements during the period.
It makes special mention of the constitutional reforms, particularly the 18th, 19th and 20th amendments which provided provincial autonomy, transfer of presidential powers to parliament, smooth installation of caretaker governments and striking down of president’s power to dissolve the assemblies.
Munir Ahmad Khan, the PPP in-charge policy and planning cell, presented the report before the media at a press conference. He said that credit goes to the PPP for ensuring independence granted to the Election Commission of Pakistan.
Khan also came up with a list of important decisions and steps taken by the PPP government to mitigate sufferings of the people despite terrorism in the country.
In this regard, he mentioned a record increase in wheat production, increase in salaries of govt officials up to 158 percent, disbursement of Rs 70 billion among 7.5 million deserving families through the Benazir Income Support Programmed and financial help to 135,000 deserving people by Pakistan Baitul Maal.
On steps taken by the government for economic revival, Khan cited the Pak-Iran agreement on the gas pipeline, agreement with China on Gwadar Port, increase in foreign exchange reserves from $6 billion in 2008 to $16 billion in 2013, increase in export from $18 billion in 2008 to $29 billion in 2012, boost in stock market from 5,220 points in 2008 to 18,185 points in 2013 and reduction in interest rate from 17 percent in 2008 to 9 percent in 2013.
He believed that these measures would help improve the economy and ameliorate the people.
Talking about the measures taken to increase production of electricity, the PPP leader told reporters that the PPP-led government added 3,600MW of electricity to the system besides initiating additional work on Mangla and Tarbela dams for increase of 4,500MW in the system.
The previous government, he added, also got $3.5 billion for Basha Dam, initiated Neelum-Jhelum, Gomal and Satpara dams and Thar Coal project to get electricity from coal besides Jamphar project to get electricity out of air.
He said further the PPP government also reinstated thousands of government servants who were dismissed during the last 13 years and also regularised thousands of contract employees.
Among steps taken by the government for welfare of the masses, Munir Khan listed resumption of trade union activities, distribution of shares among 500,000 industrial workers, cheep tractors to farmers through Benazir Tractor Scheme, increase rural economy from 50 billion in 2008 to 800 billion rupees in 2013.
He said Faisalabad-Multan Motorway and construction of thousands of kilometres of roads.
http://www.pakistantoday.com.pk/2013/03/30/news/national/ppp-releases-five-year-performance-report/
Zacky Farms, just outside Lahore, is the brainchild of Zafar Khan, a Caltech-educated software engineer who runs one of the most successful information technology companies in Pakistan named Sofizar. What started off as a recreational venture is now a side-business supplying sustainably produced organic milk, vegetables and meat to nearby Lahore suburbs. The farm is modeled on a cyclical model of minimal wastes and multiple product usage. The cows are fed pesticide-free oats, clover and grass and their manure is used to fuela biogas plant which runs the dairy facility. In an era of electricity load-shedding, such an alternative source of energy at a local industrial scale is immensely valuable to replicate as a development path. The residue of the biogas is used to fertigate the fodder fields and vegetable tunnels, which along with green manuring obviates the use of fertilizers. Free-range chickens grace the fields and there is even a fish farm on site. Zafar and his Ukrainian-born wife are committed to sharing their experiences with other farming entrepreneurs in the country.
Further south in a more rural and remote part of Punjab, famed writer and erstwhile lawyer, Daniyal Mueenudin, maintains a mid-size farm which is exemplifying other kinds of innovations. The farm does not boast ecological farming practices, apart from tunnel farming that can help with land conservation and humidity control. However, Daniyal has changed the social landscape of his area through implementing a “living wage” for all his employees. Noting the high level of inequality in Pakistan’s hinterland, the Yale-educated former director of the university’s Lowenstein Human Rights Clinic, is practicing what he preached. He also owns a farm in Wisconsin and could have a comfortable life in the States but his social obligations keep him ensconced in Pakistan for most of the year.
Raising the wage several-fold for works and farm manager, and also offering bonus incentives for performance, has led to positive competition that can help to erode the feudal levels of income disparity which exist in this part of Pakistan. At the same time, Daniyal is also committed to providing new livelihood paths for the agrarian workers as automation reduces farm employment in some areas. He has has fully funded a school and provided a merit-based scholarship for advanced degrees to students from the nearby village. One of the children from this school (the first in her family to even go to school) is now making his way through medical school in Lahore!
Zafar and Daniyal’s stories of commitment to constructive farming for social and ecological good may appear to be outliers but they are catching on and provide hope to a country which is all too often shadowed by despair. In the suburbs of Islamabad, tax incentives and planning rules to encourage farming by urbanites are leading to a growing culture of reconnecting with the land in residential farms. In rural areas, the disaster caused by the floods of 2010 brought forth numerous aid agencies with new ideas for sustainable farming. The Pakistani diaspora, often known in the West for professions ranging from taxi-driving to engineering, may well find opportunities for reconnecting to their land in far more literal ways. With growing commitment from land-owners it just might be possible to use the existential shock of recent natural disasters that have befallen the country into a proverbial opportunity for positive change.
http://newswatch.nationalgeographic.com/2012/02/23/farming-pakistan/
But, a recent increase in their penetration into far-flung areas has also boosted future prospects of the e-commerce market. What used to be limited to metropolitan cities has now spread to semi-urban and rural areas of the country. This is another potential market not only for shopping portals but also for fast moving consumer good (FMCG) companies, due to better availability of internet facilities throughout the country.
Online shopping portal, Daraz.pk, claims that online shopping websites have penetrated into the rural areas. In a recent survey, they revealed that around 48% of all orders placed in the first six months of 2014 were outside of Pakistan’s biggest cities – Karachi, Lahore and Islamabad.
“Half the world’s population will have internet access by 2017, showcasing the potential of e-commerce in the future,” said Daraz.pk co-founder Muneeb Idrees. “It is also expected that the number of mobile-connected devices will surpass the number of people. These statistics represent the expanding ecosphere of e-commerce.”
Established in August 2012, Daraz.pk is a project of Rocket Internet, the world’s largest incubator. The portal is currently offering over 400 brands in 200 cities across Pakistan. After the initial success, other venture capital firms took notice and starting initiating contact with local businessmen in the industry to fund entrepreneurs.
The website gets receives their highest number of orders (six per cent) from Ghotki, a semi-urban area in Sindh. The highest basket size across the country was from Lala Musa in Punjab, doubling the average order size of Lahore.
“In general, more than half our orders are from outside Karachi, Lahore and Islamabad,” said Idrees. “People in smaller towns have access to social media and television. They learn about new products, but don’t have malls in their cities to buy these products.”
The e-commerce market in Pakistan is estimated at around $25-30 million, in comparison to the total retail market of approximately $42 billion. Internet availability, along with introduction of branchless banking through cellular technology, has done wonders for the market.
According to estimates, branchless banking transactions have witnessed a growth of 327% during 2011-13. Daraz.pk is one of the few businesses utilising mobile commerce in Pakistan with great numbers. The management said that 20% of the transactions of the portal take place via mobile phones.
FMCG giant Unilever recently entered in an agreement with Daraz.pk to use its marketing reach all over Pakistan for its beauty and personal care products. The management thinks that this deal could be vital for the retail industry as previously no FMCG had seriously looked into the e-commerce sector. http://tribune.com.pk/story/749770/e-commerce-online-shopping-making-its-way-into-rural-areas/
This year, both these competitors have their own surpluses and would compete with Pakistan for foreign markets’ share.
http://www.dawn.com/news/1168386/potato-prices-crash
“I am proud of the agriculture scientists, whose untiring efforts in research helped boost the exports of fruits, especially mango and vegetables from the country,” the minister said, adding that country’s mango was facing severe problems of fruit-fly disease, resulting in rejection of several consignments and consequently defaming the country besides inflicting huge financial losses to the national exchequer.
However, scientists of the Department of Plant Protection (DPP) PARC in collaboration with All Pakistan Fruit and Vegetable Exporters, Importers and Merchants Association managed to control the disease by introducing hot water treatment technology which resulted in export enhancement. He said that due to these efforts, the country has now become able to export mango and several other fruits and vegetables, opening up new avenues for country exports in the markets of USA, European Union, Japan and other countries.
The conference was organised by the DPP PARC in collaboration with All Pakistan Fruit and Vegetable Exporters, Importers and Merchants Association with an aim to promote agriculture production and exports.
Speaking on the occasion, Ministry of National Food Security and Research Secretary Seerat Asghar said that the ministry was taking all best possible measures to promote research and development in the agriculture sector.
http://www.pakistantoday.com.pk/2015/04/24/business/new-technology-helped-boost-fruits-and-vegetables-exports/
The first phase of this programme was launched in 2005 for the support of Pakistan’s agriculture sector which remained successful.
While commenting on the Phase II of the programme, Australian High Commissioner in Pakistan, Margaret Adamson said recently, it has been the cornerstone of Australia’s support to Pakistan’s agriculture sector.
She also highlighting the achievements of the ASLP Phase I and said it included the uptake of furrow irrigation by nearly 1000 citrus farmers in Khyber Pakhtunkhwa, resulting in up to 40 per cent reductions in water usage, and the first successful shipment of mangoes to Europe by a farmer’s consortium.
The High Commissioner informed that Australia is now importing fruit from Pakistan and termed it one of the achievements of the programme.
She said that collaboration between government, business and research bodies, supported by Australian expertise, led by Australian Centre for International Agricultural Research (ACIAR) has been a leading force in the dairy, citrus and mango sectors in Pakistan, and has provided a model for future engagement in agriculture and water between the two countries.
Margaret Adamson said that ASLP will be followed by a similar program that will be known as the Agriculture Value Chain Collaborative Research (AVCCR) programme.
Under design at the moment, it will draw on Australian expertise to assist Pakistan improve agricultural productivity, add value to raw agricultural products and improve access to markets for those products.
AVCCR will complement Australian government’s engagement with other investments in agriculture to provide strategic support to the Pakistan Government in the agriculture sector,” she added.
The High Commissioner said, “Our common climatic conditions, ecological diversity and federal systems of government are an obvious platform of mutual interest to share knowledge and to establish research and technical linkages between our two countries aimed at a sustainable future, food security,environmental protection and economic prosperity for our people.
“We are working closely with the Ministry of Commerce and the World Bank through a $10 million investment in the Pakistan Trade and Investment Policy Program to spearhead national efforts to promote and bolster exports and trade,” she added.
http://en.dailypakistan.com.pk/business/australia-to-invest-13-million-to-support-pakistans-small-farmers-876/
https://www.thenews.com.pk/print/222765-Auto-sales-rise-41pc-YoY-in-July
KARACHI: Sales of locally assembled cars, including vans, jeeps, and light commercial vehicle (LCVs), reached 19,577 units in July 2017, registering an increase of 41 percent year-on-year (YoY) basis, the latest industry figures showed on Thursday.
“These numbers are in-line with our estimates. We attribute this apparently large increase to low-base effect due to lower number of working days last year (eid holidays fell in July 2016),” said Rai Omar Basharat, an analyst at Topline Securities, in an auto sector research report.
The figures showed that sales of Pak Suzuki Motor Company (PSMC) increased by 37 percent YoY in the period under review driven by the strong demand for Wagon-R as its sales shot up 77 percent YoY.
“With the launch of its new model, sales of Cultus increased by 66 percent YoY, whereas Ravi, which witnessed a jump of 41 percent YoY, also contributed to the growth of the company sales,” Basharat said.
He added that sales of Honda (HCAR) outperformed its peers, posting 113 percent YoY growth drawing strength from the success of the new Civic and a new SUV variant BR-V.
The report said that Indus Motors (INDU) sold 4,618 units in the outgoing month, up 11 percent YoY. “The company’s focus remained on production of higher margin Fortuner, which showed stellar growth of 543 percent YoY,” Basharat added.
Also, according to the Topline analyst, buyers were postponing their purchase of Toyota corolla, waiting for the face-lift model, which has just arrived. According to the figures released by automakers, tractor sales continued to exhibit upward trajectory with sales growing by 125 percent YoY in period under review.
“We expect the lower GST, improving crop yield due to Punjab government Kissan Package and continuation of fertiliser subsidy to improve farmers’ purchasing
power, thus improving the overall tractor sales going forward,” the analysts said in the report.
It must be noted that in the budget FY18, the Sindh government had set aside Rs2 billion in subsidy for farmers on tractor purchase. Moreover, truck and bus sales of Pakistan Automotive Manufacturers Association (PAMA) member companies in July 2017 remained strong, growing by 13 percent YoY.
“We foresee this trend to continue, fueled by China-Pakistan Economic Corridor (CPEC) led growth, higher road connectivity, lower financing rate and change & enforcement of axle load limit per truck on highways by National Highway Authority (NHS),” the Topline analyst said.
Finally, the sales of two and three wheeled vehicles grew strongly in July, up 42 percent YoY, owing to a rise in disposable income of lower middle class. “Sazgar Engineering Works Limited (SAZEW) outperformed broader 3-wheeler industry during the outgoing month, exhibiting 58 percent growth in sales YoY,” the report added.
Zulfiqar Kunbhar September 3, 2017
http://tns.thenews.com.pk/blessings-bane-come-rain/#.WbSExtOGN-U
Sindh’s Thar Desert has witnessed severe drought in the past four years. The long dry spell caused acute shortage — of food for humans, fodder for livestock and water for wildlife. During this worst drought in the recent history, hundreds of infants have died of malnutrition. The famine like situation has killed not just livestock, an important source of livelihood, but also wild species.
But the recent monsoon rains had a magical effect on the desert which has turned green from brown, promising good times ahead not just for humans but wildlife as well.
At the same time poaching and trafficking of baby wild animals including peafowl, deer, partridge and wild rabbit in the region is picking up. Thar Desert is home to around 300 species of mammals, birds and reptiles.
Prolonged drought had impacted the economy, society and environment of Thar Desert. Natural water ponds (locally known as Tarae) dried up and ground water level deepened, affecting all forms of life. There was no cultivation. Green pastures, which are the main source of food for livestock and wildlife, had depleted. Locals would spend most of their time in search of food and water. In the drought years, almost half of the total population of locals migrated along with their cattle to the neighbouring barrage areas in search of food. So did the wildlife species.
Although last year there were some rains in the desert they were not on time, hence not beneficial for locals as they could not cultivate crop due to delayed rains. Also, there was no greenery.
This year monsoon arrived on time. The desert received the first rain in the beginning of July that continued for several days, restoring the beauty of the desert.
Rain has provided the much-awaited relief to the living beings and natural habitat. Thar Desert is recovering from the bad impacts of drought. Wetter Thar means greenery and pastures all around as this part is considered the most fertile desert. There is greenery on vast areas of sand dunes locally called ‘Bhit’. That also means better food supply to flora and fauna of the area.
Much of Thar Desert’s portion lies in Tharparkar district of Sindh, stretching over 22,000 square kilometres. 300 kilometres east of Karachi, along Indian border, it has faced persistent but periodic droughts for the past several decades.
http://www.riazhaq.com/2017/09/eid-ul-azha-observance-in-pakistan.html
An often overlooked benefit of buying and sacrificing millions of animals during Eid ul Azha celebration is the massive transfer of wealth from relatively rich urban population to the comparatively poor village population. In other words, it helps create jobs and redistribute wealth to alleviate poverty in a similar way as zakat, taxes and sadaqa (charity) do. Here's a blog post I wrote last year (2016) on this subject and I am reproducing it below:
Pakistanis are spending about $3.5 billion on Eid ul Azha this year, according to analysts. This includes $2.8 billion worth of livestock and another $700 million on clothes, shoes, jewelry and various services. This amount represent a huge transfer of wealth from urban to rural population in the country.
http://nation.com.pk/multan/14-Sep-2017/pm-inaugurates-kachhi-canal-project-in-dera-bugti-today
Quetta - Prime Minister Shahid Khaqan Abbasi is scheduled to arrive in Balochistan today (Thursday) for the inauguration of Kachhi Canal Project upon its completion in Dera Bugti.
As per reports, Premier Abbasi will arrive in Dera Bugti to formally inaugurate Kachhi Canal Project on Thursday for which all preparations have been finalised and he will also address a gathering of Pakistan Muslim League-Nawaz (PML-N) workers and supporters in Sui where a large number of tribal elites are expected to join the PML-N fold.
Tight security arrangements have been made for prime minister’s scheduled visit to Balochistan.
It merits mentioning here that the Kachhi Canal Project was kicked off in 2002 but delay in its completion made the cost of the project go high and the project kept on moving on a snail’s pace. After 15 years, its preliminary phase has been completed, while in the second phase the canal will irrigate more areas.
The 363-km long Kachhi Canal Project is located in Punjab whose 281 km part is in Punjab and 80 km falls in Balochistan. The canal originates from Taunsa Barrage at Indus River. The Kachhi Canal will provide sustainable irrigation water supply to 72,000 acres of agricultural land thus bringing green revolution in Balochistan.
The project embraces significant position in Balochistan water infrastructure and agriculture sector which will fuel financial progress in the province.
Balochistan Governor Muhammad Khan Achakzai, Chief Minister Nawab Sanaullah Zehri and other ministers, MPAs and security officials will be present at the inaugural ceremony of Kachhi Canal Project.
The exports of wheat and sugar from the country during the first month of current financial year witnessed 100 percent increased as compared the corresponding month of last year.
During the month of july, 2017, about 353 metric tons of wheat valuing US$ 114,000 exported as against the export of the same month last year.
According the data of Pakistan Bureau of Statistics 58,555 metric tons of sugar worth of US$ 27.584 million were also exported from the country during the period under review.
Meanwhile, about 188 metric tons of tobacco valuing US$ 730,000 exported as compared the exports of 24 metric tons worth of US$ 78,000 of same period last year.
The exports of tobacco from the country registered 835.90 percent increase during first month of current financial year as compared the same month of last year, it added
During the period under review, about 24,393 metric tons of fresh fruits worth US$ 19.483 million exported as compared the exports of the corresponding period of last year.
On the other hand about 32,702 metric tons of vegetables valuing US$ 10.330 million exported.
During the period under review fruit exports decreased by 16.10 percent, where as vegetables exports increased by 26.80 percent respectively, it added.
According to a recent report by the Pakistan Bureau of Statistics (PBS), Pakistan’s exports have shown a positive trend backed by rising exports via the value added sector. The growth pattern has been observed during the first two months of the current fiscal year 2017-18. The upward trend in the value added sector has given a significant boost to cummulative export numbers as the New Year kicked off.
Total exports during the two month period, July-August, increased to $3.49 billion as compared to $3.12 billion showing a growth of 11.8%. While the increase in non-textile goods has been registered at 23.5% reaching $1.31 billion during July-August 2017-18 versus $1.06 billion during the same period last year.
PERFORMANCE OF VALUE AND NON-VALUE ADDED TEXTILE EXPORTS
Readymade garments have given a major upward push to the overall exports pie increasing by 15.65% on a yearly basis reaching $418.63 million during July-August period. Garments in general have also surged by 16.4% showing volume based growth.
Another integral value-added product, knitwear managed to go up by 7.53% to reach $439 million during July-August. The volume based increase of knitwear exports was 8.23%. Additionally, bed wear exports grew by 8% amounting to $384.32 million while its quantity wise growth stood at 8.79%. Furthermore, the value based growth of towel exports showed 0.67% rise while its volume based growth was registered at 0.03%.
Conversely, the picture has not been equally nice for the intermediate goods like cotton yarn, as their exports slumped by 4% (value) and by 3.3% (volume). Deteriorating demand of cotton yarn and fabric from China is considered a crucial reason for their low sales. Another slump has been seen in the exports of cotton cloth, down by 7.8% in terms of value and quantity. Exports of raw cotton have also seen a downward trend with 14.7% in value and 14.15% in volume during July-August 2017-18.
A major blow has emanated from exports of non-value added products such as cotton carded, which dropped by a whopping 100% in value and volume. In addition, exports of tents and canvas declined by 22% in terms of value. On the other hand, exports of yarn slumped by 0.2% in value but increased in terms of volume.
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A GLANCE AT NON-TEXTILE EXPORTS
From the non-textile related goods, rice exports grew by a significant 40% during the two months. Basmati and other types of rice exports took a major leap.
From the food category, a major jump was seen in exports of wheat, sugar, fruits during the given period. Crude petroleum and petroleum naphtha registered a growth of 100% and 404% accordingly. Nonetheless, exports of sports goods and carpets saw a downward trend.
Value added leather products increased by 5.8% which was witnessing continuous slump during the last two years. Footwear showed a feeble growth of 0.1% during July-August 2017-18. Furthermore, surgical and engineering goods managed to rise by 26% and 23% respectively.
https://www.geo.tv/latest/159391-pakistan-exported-commodities-worth
The country earned US$ 512.3 million by exporting different food commodities during the first two months of the current financial year as compared the earnings of the corresponding period of last year.
During the period from July to August 2017, food group exports from the country increased by 30.6 percent as compared the exports of the same period of last year.
According to the data of Pakistan Bureau of Statistics, since the last two months exports of rice grew by 40 percent as around 428,993 metric tons of rice worth US$ 223.97 million were exported.
The rice exports, during first two months of last financial year, were recorded at 3810,861 metric tons, which were worth US$ 159.54 million, it added.
Meanwhile, the exports of basmati rice grew by 10.35 percent and about 59,433 metric tons of basmati rice, worth US$ 62.741 million, were exported as compared the exports of 59,192 metric tons, valuing US$ 56.857 million, in the same period, last year.
The exports of rice other than basmati also witnessed an increase of 58.98 percent, around 369.580 metric tons of rice costing US$ 161.198 million exported as compared to the exports of 251,669 metric tons worth US$ 102.888 million last year.
From July-August, 2017-18, fruit and vegetable exports increased by 8.74 percent and reached at 56,280 metric tons worth of US$ 20.58 million against the exports of 73,751 metric tons of US$ 18.88 million of the same period last year, it added.
The other commodities which witnessed an increase in their exports during the period under review include fish and fish production, which increased by 19.63 percent, wheat and sugar increased by 100 percent respectively.
It may be recalled here that imports of the food commodities into the country also witnessed an increase of 27.18 percent and about US$ 1.123 billion was spent on the import of different food items to fulfill the domestic requirements.
November 11, 2017 By:Samaa Web Desk Published in Blogs Be the first to comment!
https://www.samaa.tv/blogs/2017/11/pakistani-farmers-fast-adopting-tunnel-farming-techniques/
Tunnel farming is not less than a windfall for farmers in Punjab and other upper parts of Pakistan as vegetables grown two months ahead of the actual time window fetch three to five times more price.
Recent uppish trends in the prices of the kitchen crops especially tomatoes and onions have made off-season veggies technology more popular among the farmers.
“I sold cucumbers grown at my farm at a rate of Rs 50 per kilogram last month. But these are now fetching now Rs 22 per kilogram in the whole sale market, almost twice the prices these are sold for in season,” says Allah Rakha, an owner of a farm in Kharianwala in Central Pakistan province of Punjab.
Tunnels, the structures comprising steel pipes covered by plastic sheets have lately mushroomed in Pakistan’s plains, mostly in central Punjab districts of Sheikhupura, Nankana Sahib and Gujranwala, following the suit of farms in Khyber Pakhtun Khawa, the north-western province.
Besides Cucumbers, other high-value vegetables grown in Pakistan through tunnel farming include- tomatoes, chilies, Caspicum (Shimla Mirch) and gourds.
The nurseries of tomatoes, chilies and caspcus are being transplanted these days in Punjab and the crop is expected to be at fruiting stage by February.
The technology not only helps produce the crop at least two months earlier than the traditional cultivation season but also saves the crop from all sorts of severe weather and handling related problems. In Punjab, the provincial government is providing subsidy for the purchase of drip irrigation gadgets while USAID is providing technical and financial assistance to growers in Khyber Pakhtun Khawa. But due to lack of awareness, the area under tunnel farms in Punjab is not more than 350 acres which is just iota when compared to millions of acres of agriculture land in the province.
“More and more growers should turn to this technology; We are ready to provide all sorts of assistance,” says Dr. Zafaryab Hyder , Director General Agriculture Extension, Punjab.
In spite all the constraints, the new technology has opened new vistas of prosperity for the farmers who had been victim of subsistence culture over the last several decades. Just a decade ago, the people of Punjab had to relish on the vegetables grown in the neighboring provinces of Sindh, Khyber PakhtunKhawa and Balochistan at exorbitant prices. The vegetables like bitter gourd, okra, peas , tomatoes, chilies , cucumbers from other provinces fetched atleast twice as compared to those produced in the Punjab just a couple of months later. However, the introduction of tunnel farming has produced new array of opportunities, initially for the progressive farmers who can get price for tomatoes, capsicum (Bell Peppers) thrice in early time window than the traditional season of cultivation. The owners of land tracts with tunnel farming are mostly educated youth, mostly agriculture graduates and Masters’ in Business Administration. They are no more being exploited by the middle man.
Rather, they provide high-value off-season vegetables directly to hotels and departmental stores. Besides vegetables, even the growers of strawberry in Lahore and Sheikhupura districts have adopted the tunnel farming to protect their crops from the severe weather conditions. With the passage of every day, the future of this new technology is becoming more and more bright especially the fertile agricultural lands of Punjab. The future of tunnel farming seems bright in Pakistan as growers have started embracing the technology lately.
However, the ongoing smoggy weather in the Central Pakistan has cast ill-effects on the crop with hindering the photosynthesis process much needed for the plant growth. Growers fear that per acre yield may decline drastically if the unfavorable weather conditions continue.
Rags to riches: Tunnel farming: the swift money maker
By Saquib Saeed
Published: June 7, 2015
https://tribune.com.pk/story/899495/rags-to-riches-tunnel-farming-t...
Tunnel farming is a low-tech, but highly unconventional vegetable growing technique that started in the early 2000s in Pakistan. Currently, it is centred in the districts of Arifwala, Vehari and Mailsi in central Punjab with little emerging pockets in Faisalabad, Jhang, Multan and Rahim Yar Khan.
According to estimates of the Punjab agricultural department, there are more than 200,000 acres of tunnel farms in Punjab and the trend is growing. A very high urbanisation rate in Pakistan keeps creating greater demand for vegetables in the urban centres.
Currently, most tunnel farms remain between 10 to 20 acres in size and begin cultivation in autumn. That’s when support structures made out of bamboos, steel or aluminum pipes and steel wire ropes are erected around the plantation. These structures form rows that are 4 to 5 feet wide and have a height that’s between 3 to 12 feet. Known as low tunnels, walk through tunnels or high tunnels in their parlance. The higher the structure the more expensive it is to erect. Polythene sheets are spread on top of the structures, creating tunnel like cocoons within which vegetables are grown.
The winter sunshine passes through the transparent polythene sheets and its heat is trapped inside; while in the cold weather, the frost and the winter rains are kept well outside. This makeshift greenhouse deceives the vegetables into believing that it’s time to flower and fruit. As the weather warms up, the polythene sheets are removed.
The vegetables from tunnel farms arrive two to three months earlier than the same varieties grown conventionally in the open. Consumers no longer have to wait till April; they can savor their favourite vegetables in early spring or even in the middle of winters. Off-season arrival ensures that they command higher prices. This remains the single most important economic driver for tunnel farming.
Tunnel farmers routinely achieve an astonishing 500% yield over conventional farmers. Surprisingly, it’s not done by using exotic seeds or fertilisers. Instead, tunnel farmers adopt low-tech methods. All of their inputs such as the bamboo sticks, metal pipes, steel wire ropes, and polythene sheets, fishing lines, seeds, fertilisers and insecticides remain mundanely commonplace. What’s surprising is the innovative use that they put these inputs to; and with stunning results.
Mulching is one such technique in which they cover the ground with black polythene sheets and puncture evenly-spaced holes in it. Vegetable seeds are sown into these holes. This eliminates weeds that consume and ultimately waste the nutrients. Devoid of sunlight, nothing else apart from the plant itself can grow. The sheet also trap moisture in the ground and prevents its rapid evaporation. Conventional farming loses up to 50% of its water to rapid evaporation, tunnel arming doesn’t.
While within each row, thin fishing lines are strung as mesh to provide vertical space for the vegetables to grow. Most vegetables have indeterminate growth, much like creepers and vines. These mesh provide vertical pathways for the plant to grow. Depending on the height of the tunnel, each plant therefore grows at least three to five times larger in size and its reach than its conventionally grown, on ground twin. Consequently, it also bears more fruits.
Tunnel farmers also apply three to five times more chemical fertilisers and micro nutrients than conventional farmers. Every day, they patrol their tunnels much like a spinning mill owner would patrol his spindle frames. The ripe vegetables are identified, picked, weighed and sold daily under their watchful eyes.
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https://www.thenews.com.pk/latest/246635-usaid-helping-boost-pakistans-chili-production
The U.S.-Pakistan Partnership for Agricultural Market Development (AMD), along with the Trade Development Authority of Pakistan (TDAP) and Government of Sindh held a conference in Karachi that brought together public-private stakeholders to discuss issues and challenges pertaining to Pakistan’s chili sector.
USAID Deputy Mission Director Oghale Oddo, Federal Secretary Ministry of National Food Security & Research, Fazal Abbas Mekan, and Secretary Agriculture, Government of Sindh, Sajid Jamal Abro, participated.
“We are proud of the role USAID has played for many years to support the development of Pakistan’s agriculture sector. The U.S. government is hopeful that these efforts will help Pakistan emerge as a major player in the international market,” said Deputy Mission Director Oghale Oddo. “We are confident that we can help Pakistani chili exports become more competitive in the international arena by introducing innovative technology and providing technical assistance.”
Through discussions and interaction during the conference, stakeholders reviewed and endorsed AMD’s efforts and shared solutions to problems faced by the industry.
USAID launched the U.S.-Pakistan Partnership for Agricultural Market Development in February 2015 to improve the ability of Pakistan's commercial agriculture and livestock sectors to compete in international and national markets in the four target product lines; meat, high value and off season vegetables, mangoes, and citrus.
This partnership acts as a catalyst for development and investment in the target product lines, helps improve the quality and increase the quantity of exportable agricultural produce, and promotes cooperation among farmers, processers, exporters, and buyers of Pakistani agricultural products in international (non-U.S.) markets thus resulting in increased incomes and generating employment opportunities for Pakistani people working in the targeted product line.
transformations in Pakistan
ARIF HASAN
https://journals.sagepub.com/doi/pdf/10.1177/0956247809356180
This paper derives from a longer IIED report and describes the close
relationship between migration/emigration and the sociology/ecology of the
different regions of Pakistan, and poverty-related issues in these regions. It also deals
with the massive migrations from India to Pakistan (at the time of partition and
as a result of three wars with India), the migration from Afghanistan (as a result of
the prolonged Afghan war), and from Bangladesh (as a result of the creation of that
country). The socioeconomic and political repercussions of these migrations are
discussed, as well as rural–urban migration and its repercussions on both the urban
and rural areas of Pakistan. The sections on emigration establish that, by and large,
emigration has not benefited the emigrants and their families except in relation to
building real estate. In addition, it has created severe strains on the extended family
and has increased the rich–poor divide. However, worker’s remittances from abroad
have played an important role in the growth of Pakistan’s GDP, and without them
the exchange rate and monetary and fiscal policies would have come under greater
pressure. The paper also deals with the legal and illegal processes of migration and
emigration; the role of the informal and state agencies in the processes; the role of
emigrant organizations in financing and in social projects and programmes; and
suggestions for enhancing and improving these roles. Finally, the paper focuses
on three very different small towns and discusses the impact of migration and
emigration on their physical and socioeconomic development; also the fact that
although the economy is dominated by the merchant classes, the political power
rests firmly with the landed elite except where the state is the major landowner
https://pubs.iied.org/10570IIED/