Department of Economics
Pakistan Institute of Development Economics Islamabad
Economy of every state depends on three sectors i.e. agriculture, industry and commerce. These three are interrelated with each other as the progress or retrogress of one sector effects the other two. Pakistan is an agricultural state thus agriculture gains are of much importance than any other sector. Importance of this sector is manifold as it feeds people, provides raw material for industry and is a base for foreign trade. Pakistan's principal natural resources are arable land and water. 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 where wheat and cotton are the most grown. Some people also have mango orchards but due to some problems like weather, they're not found in a big range. Foreign exchange earned from merchandise exports is 45% of total exports of Pakistan. It contributes 26% of GDP and 52% of the total populace is getting its livelihood from it. 67.5% people are living in the rural Ares of Pakistan and are directly involved in it. There are two crops in Pakistan i.e. Rabi & Kharif. Major crops of Pakistan are wheat, rice, maize, cotton and sugar cane. These major crops contributed 7.7% last year against the set target of 4.5%. Minor crops are canola, onions, mangoes and pulses which contributed 3.6% as there was no virus attack last year. Fishery and Forestry contributes 16.6% and 8.8% respectively. 2.1.
Farming is Pakistan's largest economic activity. In FY 1993, agriculture, and small-scale forestry and fishing, contributed 25 percent of GDP and employed 48 percent of the labor force. Agricultural products, especially cotton yarn, cotton cloth, raw cotton, and rice, are important exports. Although there is agricultural activity in all areas of Pakistan, most crops are grown in the Indus River plain in Punjab and Sindh. Considerable development and expansion of output has occurred since the early 1960s; however, the country is still far from realizing the large potential yield that the well-irrigated and fertile soil from the Indus irrigation system could produce. The floods of September 1992 showed how vulnerable agriculture is to weather; agricultural production dropped dramatically in FY 1993. (Data as of April 1994) Agriculture has been the back bone of the Pakistan economy, although in recent years its share in GDP has somewhat declined. From a contribution to gross domestic product of more than half in the 1940s, today it accounts for less than a quarter. The share of employment in agriculture has also fallen, from more than 65 per cent of the labor force in 1950 to about 47 per cent today. It would be fair to say that one of the most important events in Pakistan’s agricultural history, with extensive repercussions on the other sectors, has been the process called the Green Revolution, which occurred in the mid-1960s. The technology package associated with it generated major changes in the economic social and political structure of the country transforming the agricultural and rural sectors irreversibly. Much of what we see today in terms of economic groups and classes, political affiliation and even culture, has its roots in and is a consequence of the Green Revolution. However, while the mid-1960s are in many ways an important juncture in our history, it is necessary to emphasize that change is a continuous process and events like the Green Revolution act only as an impetus to that change. While present-day Pakistan may have its roots in the Green Revolution, a lot more has happened since the mid-1960s to make...