Agricultural Growth and Change in Employment
The contribution of agriculture to Pakistan’s GDP has gradually fallen in the last 30 years, however, the sector still represents around 20% of the national economy while employing ~40% of the workforce.
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Pakistani agriculture does not realize its full potential. Although there is agricultural activity in all areas of Pakistan, most crops are grown in the Indus River basin of Punjab and Sindh producing roughly 80% of the total national output. The 'food and beverage processing' industry is the second largest in Pakistan after textiles, accounting for 27% of the value-added production and 16% of employment in the manufacturing sector. Most of Pakistan’s food processing industries are in Punjab (60%) and Sindh (30%).
According to a recent report by the World Bank titled 'Enhancing Smallholder Incomes by Linking to High-Value Markets in Pakistan’s Punjab and Sindh Provinces', the agriculture sector is operating below the potential yields. The well-irrigated and fertile soils of the Indus irrigation system could produce more when compared to productivity levels in similar regional and global farming systems.
Pakistan’s overall agricultural growth rates are the lowest in the region (while the change in employment share in the agriculture sector is the lowest too - scroll down to find out) due to state interventions that have distorted markets and private investment in the physical and human capacities of the agriculture sector in Pakistan. With agricultural development slowing down, the reduction of rural poverty and hunger also slows down. In such circumstances, rural poverty increases, and the country may remain mired in poverty. This slowdown, in Pakistan, has increased the agriculture sector's capacity to absorb large amounts of an often unskilled labor force that would possibly be unemployable in other sectors of the country.
GRAPHIC OF THE DAY
Agricultural growth and change in employment share in South Asia Region (SAR) countries
INSTAGRAM POSTS
Annual Inflation Went Back to Over 30% After 3 Weeks — www.instagram.com
• The Combined Index was recorded at 214.88 this week compared to 164.53 a year ago increasing by 30.6% on an annual basis
• On a weekly basis, prices increased for all quintiles by 0.53%
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Weekly Data Watch (Commodities) — www.instagram.com
• Prices of Tomatoes (+15.9%), Onion (+9.3%), and Potatoes (+2.8%) rose vs. last week
• Fall in prices of Chicken (-3.7%) and Daal Masoor (-2.2%) helped moderate inflation
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Weekly Data Watch (Stocks, Exchange Rate): — www.instagram.com
• KSE-100 rose and remained positive most of the time during the week as investor confidence was strengthened due to an agreement worth USD 500 million with the World Bank and RMB (Chinese currency) clearing arrangements in Pakistan
• PKR appreciated slightly this week as foreign exchange reserves went up due to the disbursement of USD 1.5 billion from the ADB and the government's warning to smugglers to stay away from hoarding dollars
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What Else We’re Reading
Pakistan PM Shehbaz's China trip brings 'more words, little action' (Nikkei Asia)
'PIMEC 2023’ can help jump-start the maritime sector (Business Recorder)
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