China-Pakistan Economic Corridor (CPEC): Opportunities for Agriculture Sector in Pakistan

The agriculture sector of Pakistan is the backbone of Pakistan’s economy. CPEC is offering tremendous opportunities for all major sectors of Pakistan in terms of technology and investment.

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The Agriculture Sector has been a dominating contributor to Pakistan’s economy since independence. The performance of this sector has witnessed a significant decline due to political, climate, social, and environmental problems. Lack of advancement and technology has further deteriorated the situation. To strengthen Pakistan’s economy and for poverty alleviation, the agriculture sector holds centrality in Pakistan. It plays a crucial role in Pakistan’s economy; its contribution to Gross Domestic Product (GDP) is 21% with an average annual growth of 2.7%.

Moreover, 44% of the labor force is linked with the agriculture sector and 62% of the rural population relies on this sector for livelihood. Given the fact that the agriculture sector of Pakistan has manifold roles which include poverty alleviation, economic growth, industrial development, and food security, Pakistan is striving to lift the growth of its agriculture sector. BRI’s flagship project CPEC has undeniable economic, political, and strategic importance for Pakistan. It is offering wide-ranging opportunities for all the major sectors of Pakistan and has enormous potential to revamp and modernize the agriculture sector of Pakistan.

Poor infrastructure has been and still is a major impediment in the way of agricultural growth in Pakistan. According to Global Competitiveness Index (2018-19 edition), Pakistan stands at the 110th position in the world. Infrastructure is directly linked with agriculture and has an unmatched impact on agricultural growth. Infrastructure development is very crucial for the trade of agricultural products. It reduces the cost of transportation and enhances integration. Construction of roads makes the access of farmers easier to markets. Better energy facilities increase the area for irrigation land and as a result outcome of crops cultivated through the underground irrigation systems is higher than those which are cultivated through canals or other means.

It is rightly stated that infrastructure development is inevitable for desired growth of Pakistan’s agriculture sector. China-Pakistan Economic Corridor (CPEC) is primarily focused on infrastructure projects in Pakistan. Under CPEC, various infrastructure projects have been launched in Pakistan which include KKH Phase II, Peshawar-Karachi motorway, Khuzdar-Basima Road N-30, up-gradation of DI Khan-Zhob N-50 Phase I, etc. Owing to CPEC’s contribution to the energy sector of Pakistan, the problem of electricity shortage has been eliminated.

Furthermore, the use of modern methods and lack of technology has significantly affected the growth of the agriculture sector. Our farmers are using the old-traditional methods and lacking technical knowledge. Modern implements, chemical manures and scientifically proven improved types of seeds are not being used in our country. In addition to it, excessive use of canal water has turned our lands into victims of dangerous diseases. Salinity turns 100,000 acres of arable land into salt and marches lands and water logging is also injurious for cultivated lands. The lack of advancement and technology has also resulted in a relative decline in the growth of various major crops in Pakistan. The government of Pakistan has accepted that the agriculture sector could not grow more than 1.9 percent in the current fiscal year. To overcome these challenges and improve the growth of this largest sector of Pakistan, CPEC can play a decisive role.

The CPEC, substantially, will increase socio-economic connectivity between China and Pakistan. The production of major crops in China is two times higher than the yield in Pakistan. Through increased connectivity, Pakistani businessmen and farmers can learn about the methods and techniques which is being used by the Chinese for production of crops in China. For example, water-saving irrigation, smart agriculture, compound, and greenhouse planting technologies are used in China which are also suitable for crops in Pakistan.  Few concrete steps have been taken in this regard and China has also shown interest in the agriculture sector of Pakistan.

In October 2019, Pak-China Agricultural Cooperation Exchange Centre was established in Islamabad. China has agreed to provide sustainable solutions for problems of the agriculture sector of Pakistan. In addition to it, on 4 September 2020, Chinese ambassador Yao Jing and agriculture commissioner of embassy Dr. Gu Wenliang met Pakistan’s foreign minister Shah Mehmood Qureshi. In this meeting, the Chinese ambassador has agreed to set up agriculture technology centers to boost Pak-China cooperation in the agriculture sector in Pakistan. These developments will help Pakistan’s agriculture sector to equip with modern methods and techniques which will ultimately result in a significant rise in the yield of crops in Pakistan.

It is pertinent to mention that the government of Pakistan is working to include agriculture in the CPEC framework. China has approved technical assistance for 13 mega agriculture sector projects under CPEC. It is appreciable that the government of Pakistan understands the importance of the agriculture sector for Pakistan’s GDP and is now taking practical measures to achieve desired growth in this sector. While meeting with Chinese Ambassador FM Qureshi said, “Agriculture is the mainstay of Pakistan’s economy and employs a large part of Pakistan’s productive labor force. There is a greater need to revamp and modernize the agriculture sector with China’s co-operation and unleash the Second Green Revolution in Pakistan.”

Moreover, CPEC offers opportunities to export agricultural goods to China. China is the most populous country in the world with a 1.39 billion population. Even though China is the leading country in producing many major crops but to fulfill the food needs of its gigantic population is a great challenge. To meet this challenge, China imports a high amount of agricultural goods from different countries. China spends more than 100 billion USD on agricultural imports every year and Pakistan’s share in these imports is almost negligible. Through increased connectivity, Pakistan can increase its agricultural exports to China. It is a win-win situation for both China and Pakistan. Due to low transport costs, it is preferable for China to import agricultural goods from Pakistan. On the other side, it will help Pakistan to boost its economy and help Pakistan’s exports which have been declining over the past many years. In addition to it, the majority of the farmers in Pakistan are poor. The exports of agricultural goods will improve the livelihood of these farmers.

China-Pakistan Economic Corridor has been rightly declared a game-changer. It will turn Gawadar into an economic hub and enhance economic activities in the region. It has the potential to reshape the economic outlook of Pakistan. The agriculture sector of Pakistan is the backbone of Pakistan’s economy. CPEC is offering tremendous opportunities for all major sectors of Pakistan in terms of technology and investment. Infrastructure development and technology transfer will have a significant impact on Pakistan’s agriculture sector as well. Through increased connectivity between China and Pakistan, Pakistan can export its agricultural products to China which will contribute to the economy of Pakistan. If these opportunities are used in full potential, Pakistan will witness a significant impact on its GDP and ultimately the livelihood of the people of Pakistan.

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