Government Subsidies and Inefficient Systems
Wasteful public spending on agriculture subsidies amounts to USD 2.7 billion per year.
Was this email forwarded to you? Subscribe here.
The recent World Bank report titled 'Pakistan Country Climate and Development Report November 2022' highlights the inefficiencies in Pakistan’s 'already half-hearted' efforts to gear the agriculture sector. Especially, considering the recent climate extremes the problems are garnering attention. After the floods, it has become more important than ever to build back better to regain stability and prevent such crises.
The report showcases Pakistan’s lack of technological improvements in the agriculture industry. Solely relying on easily available water, and pesticide use, the industry has been driven by convenience for too long. In a future with droughts and scanty natural resources, merely injecting money won’t solve Pakistan’s problems.
Unfair competition in the industry also leads to a distortive distribution of subsidies. For instance, Punjab and Sindh are home to a significant number of sugar and wheat mills. Coincidentally, the government has mostly subsidized these crops as well. Consequently, smaller farmers have been unable to grow, instead, they end up bearing the downside of pollution caused by large farmers.
The report suggests ‘phasing out wheat support system’, which will result in the government saving much of its revenue while promoting diversification in agricultural production. Other recommendations suggest supporting better technological development for regenerative efforts, etc.
All in all, just injecting money into agriculture won’t solve Pakistan’s complex systematic issues.
GRAPHICS OF THE DAY
Being a staple crop, wheat production has seen support from the government over the years. This has led to an increased production trend, although crop diversification has been dismal
Fertilizer consumption has been used as a sole measure to increase crop yield
INSTAGRAM POSTS
Remittances October 2022 — www.instagram.com
⚫ Overseas Pakistanis remitted USD 2,215.7 million during October 2022, on a monthly basis remittances decreased by 9% and by 15.7% compared to October 2021
⚫ Major decrease in remittances on a month-on-month basis came from Other GCC (-12%) and the UK (-9.4%)
View more
SBP's forex reserves decreased by 10.7% week-on-week — www.instagram.com
View more
What Else We’re Reading
Economic crisis: AIIB to give us USD 500 million to counter social fallout (Business Recorder)
Global economic crisis strangling progress for poor. Flood-battered Pakistan, for instance, is likely to see its exports of key commodities like cotton and rice hit, which affects international markets and commodity prices. Making payments on its debt will also be tougher with less income (Reuters)
Advertise With Us — macropakistani.com
Improve brand awareness for your startup/business or amplify the reach of your ongoing marketing campaigns by promoting them on Macro Pakistani. We have previously done successful paid collaborations with:
Send an email to hello@macropakistani.com
Learn more:
About Us: Macro Pakistani is a data-driven research platform that aims to provide a basic understanding of Pakistan’s economy. If you have an interest in contemporary news but are currently overburdened with sensationalism and specialized vocabulary, we are the platform for you.
How are we doing? Please send us any questions, comments or suggestions by replying to this email.