Pakistan is yet to take an appropriate slice from the global cake of horticulture exports; despite the fact that the global trade in horticulture had increased four times over the last two decades and stood at more than USD 200 billion in 2019.
Since 1947, the agriculture sector in Pakistan has received inconsistent attention. There have been times of great development, however, it can be argued that the last two decades have been bad for agriculture. Research conducted by the International Food Policy Research Institute (IFPRI) reveals that the Total Sector Productivity, one of the most informative measures of agricultural productivity, has been negative over the past two decades. This shows that our growth is now reliant on inputs or an increase in area under cultivation. Other countries have witnessed sustainable yield gains of multiple crops through balanced fertilizer application, genetic improvement, improved farming practices, etc. but we are not exploiting any of that.
Agriculture Census 2010 noted that 78% of the farmers in Pakistan have landholdings of less than 7.5 acres. Wheat, cotton, maize, sugarcane and rice are the main crops grown by these farmers. These crops are labour-intensive and mechanization plays a small role. This means that sowing of these traditional crops is of little competitive advantage for these subsistence farmers as compared to high-value agriculture. Therefore, it is high time to capitalize on the opportunities offered by horticulture and it has to be given a central role in order to boost agricultural growth.
As per a report of the Food and Agriculture Organization (FAO) of the United Nations, rising living standards and bourgeoning population will swell the demand for horticulture products by 70% over the next thirty years
If we talk about ground realities, in the face of declining textile exports, the country doesn’t have an alternative plan for the continuity of the exports.
The report says Pakistan retains only 1.5% share in world export of citrus fruits and 2.8% share in world export of potatoes, however, through upgrading our production methods, seed varieties, processing infrastructure and produce quality, we could easily export USD 2.2 billion worth of horticulture commodities in the next two years.
Egypt provides a good case study for Pakistan to learn from, by implementing a Sustainable Agricultural Development Strategy. Since 2009, Egypt has focused on capturing export markets for its horticulture commodities and currently exports about USD 3.2 billion worth of oranges, grapes, potatoes, strawberries and onions to the Russian Federation, European Union and the Middle East.
Pakistan has the potential to export processed citrus products and potato fries and chips. However, the unavailability of industrial-grade varieties, surplus production, and processing capacity have constrained export quality food products.
Pakistan needs to increase its output by improving yields and attaining exportable surplus crops. There is currently an emphasis on catering to the domestic market. India is one of the key players in this industry through value addition but in the last 70 years Pakistan’s concerned ministries didn’t work on it aggressively. A steep decline started when we devolve agriculture and its allied sectors to provinces through the 18th Amendment.
Currently, Pakistan’s horticulture sector suffers from low-yields as compared to its peer countries due to the unavailability of the necessary seeds for high-grade produce of fruits and vegetables, weak contract enforcement for contract farming, poor on-farm sanitary and phytosanitary standards (SPS) enforcement, inadequate post-harvest infrastructure for packing, handling and transportation, lack of protocols for certifications of health and safety standards, and unassured supply of raw material to processors. Various analyses over the past several decades have highlighted numerous gaps in the regulatory framework that constraint productivity, profitability and export of the horticulture sector. An archaic and restrictive framework that developed long ago needs complete overhauling. With limited buyer access at the wholesale level, it is alleged that farmers face oligopsony conditions in produce markets, which have become too congested, and the mechanisms for price transformation, in particular for quality differentials are ineffective.
Studies have suggested that the postharvest handling and marketing is poorly developed in Pakistan. For example, the quality of Pakistani mango is considered generally good but 30 to 40 percent of fruit is reported wasted in the harvest-to-market system, mainly due to poor handling. Modern infrastructure such as cold storage, grading and postharvest treatment facilities and appropriate transportation is almost non-existent.
However, under CPEC, China is potentially a large export destination for Pakistan’s fruit commodities, but exports are restricted due to stringent SPS compliance requirements enforced by China. For instance, citrus trade is not permitted via land and air routes to China, and therefore Pakistan has to transport its mandarins by sea to the eastern Chinese ports, increasing cost and time. It would be cheaper and easier to export via land which is pending a quarantine agreement between Pakistan and China.
Similarly, linkages between industry and academia would help enhance horticulture exports. It is a prerequisite for transforming the agriculture sector into a hi-tech industry and enabling it to compete at the global level.We are a developing nation that can generate a surplus amount of wealth from industry-academia linkages. It possesses a wide range of benefits that can influence universities, companies, society and the nation. The benefits relating to society through industry-academia linkages are numerous.
The Pakistan Horticulture Development and Export Company (PHDEC) initially worked somehow well, it later virtually becomes dormant. PHDEC failed to introduce concrete measures for the promotion of horticulture exports. For the last five years, the company has been run by acting chiefs.
Further, the government should incentivise businessmen to invest in cold storage as it is a vital part of the supply chain for exporting fruits and vegetables as well as for local markets. It is high time, the government to announce certain incentives i.e., owners or operators should get only leased land in special economic zones (SEZs) on a 15-years basis which would be a great push to the horticulture sector’s dwindling infrastructure.
Pakistan needs to develop a coherent national policy for horticulture development that integrates the views of all the stakeholders, i.e., farmers, input service providers, agriculture traders, provincial and federal governments.
Development of an integrated approach to fill all of the identified gaps in the supply chain in a single step, training of farmers, development of a quality inspection authority, arrangement of roadshows to attract potential investors to invest in the Pakistani horticulture sector, a complete ban on the use of wooden crates for export, setting trade targets for trade missions, reformation of agriculture credit regime and outsourcing marketing campaigns are a few areas to address on a priority basis. A growing and developed horticulture sector can create avenues of employment for the rural poor, enhance household income, provide people with quality fruits and vegetables and open opportunities for exports.
The writer is a member of PML-N’s Research and Policy Planning Unit, and Federation of Pakistan Chambers of Commerce and Industry Standing Committee on Agriculture & Horticulture’s former chairman
