Latest news with #DaudKhan
Express Tribune
6 days ago
- Business
- Express Tribune
Wheat in Pakistan — quo vadis?
Daud Khan is a consultant and advisor for various Governments and international agencies. He has degrees in Economics from the LSE and Oxford – where he was a Rhodes Scholar; and Sanakhawan Hussain is a senior member of the Sindh Chamber of Agriculture. He holds a degree in economics and finance Listen to article For years Pakistan's sclerotic wheat sector has been on life support which has cost the taxpayers and consumers billions of rupees. Wheat is the basic staple food for most Pakistanis and makes up the bulk of our calorie intake. However, production has grown slowly, lagged behind population growth and made Pakistan increasingly dependent on foreign supplies. Between 2 and 3 million tons – around 10% of our needs – were imported in 2023-24 and it is likely that similar, if not larger, imports will be needed this year. The main reason for this slow growth is lagging farm level productivity – yields have remained stubbornly low at around 30 maunds per acre (3 tons/ha) over the last decade. The reasons for slow productivity growth are well known. Wheat is mostly produced by small farmers on tiny plots of land, often measuring less than 10 acres. These farmers lack technical knowledge and skills, as well as access to finance. They have failed to adopt even simple technology interventions such as reduced tillage, planting with certified seeds, use of seed drills, balanced fertiliser and micronutrient applications, and careful use of water. There are also large on-farm and off-farm losses due to poor harvesting and lack of bulk handling and storage in modern silos. Instead of working to improve yields through land consolidation, better farm management and improved technology, the government has in the past tried to accelerate growth by literally throwing money at it. Billions of scarce public money have been spent on subsidising costs of inputs and buying wheat at fixed prices that are often above the free market equilibrium price. The logic that underpinned this policy is that lower fertiliser prices would increase applications and raise yields; and high wheat prices would increase the amount of land allocated to wheat while also enhancing investment in inputs such as seeds, machinery and water. However, the policy has demonstrably not worked. The reasons for this failure are not difficult to understand. Fertiliser subsidies go mainly to medium and large-scale farmers who are already using close to optimal levels of fertilisers. Subsidies mean more money in their pockets but bring about little change in behaviour. In contrast, poor farmers, most of whom use sub-optimal doses of fertiliser, are usually not able to access subsidies. Similarly, poor farmers rarely benefit from high government procurement prices – the bulk of their production is for self-consumption and the surplus, if any, is usually sold at harvest time to intermediaries at whatever price they get. With growing fiscal constraints and pressure from various domestic stakeholders as well as development partners, the government has finally stopped wheat procurement at fixed prices. The abolition of government procurement was a shock to the system. In 2024, wheat prices fell to half their level in 2023. Wheat farmers were up in arms saying that the lack of government procurement and the collapse in prices meant that, for the first time in decades, they are unable even to cover operating costs. The solution is not to go back to a procurement system that has failed, but to move forward to create an efficient and competitive wheat sector. Like any major structural change it will not be easy. Some short-term measures to ease adjustment are already under implementation by the government and the private sector. These aim to improve the working of markets; provide a safety net to the poorest farmers; and enhance financial flows into the systems. Some of these measures are already having an impact. Wheat prices for the current 2025 season were initially similar to those for 2024. However, market intermediaries have realised that with output projected to be significantly lower than 2024, prices will increase. Already there are reports of large offtakes by traders and increasing prices. However, for the medium to long term it is essential to understand that farmers cannot make money if they continue to cultivate tiny plots, use inputs inefficiently and get yields of only 30 maunds per acre. The brutal fact is that cereal crops, such as wheat, can only be efficiently grown on large farms that use modern technology, appropriate machinery and quality inputs. Ideally this could be done if small farmers come together to work in cooperative or consortia; if larger farmers rent land from friends and relatives; or if corporates are allowed to buy or lease land. More dynamism is also essential to meet the challenges of climate change and in particular of changing rainfall patterns. This has resulted in higher precipitation in some of the arid areas in Balochistan and Sindh, and has expanded the potential area for wheat. But, making better use of this potential requires agile production systems. In good rainfall years, manpower, equipment and inputs need to be quickly moved into arid areas to plant wheat. In addition, small but carefully designed investments are needed, for example, in small dams for storage and water spreading; machinery pools that can be moved quickly as needed; and low-cost storage facilities for harvested grains. All this does not mean that small farmers should not grow wheat for their own use or for their friends and family. They should. And government research and extension systems must help them do this more efficiently. But at the same time, they should be helped to diversify into high value products where they can actually make money. Furthermore, there is need for a more liberal approach to both domestic and international trade in wheat related inputs, particularly seeds; allocation of more funding to research, including in collaboration with the private sector and international institutions; and creation of conditions for the private sector to utilise new lands in previously uncultivated areas The government should also liberalise wheat movements across the country, as well as allow the private sector to freely import and export. These steps are essential to create a national market that can balance out national and local supply shocks – shocks that are likely to increase in frequency and intensity in coming years.
Express Tribune
02-04-2025
- Health
- Express Tribune
Air pollution and the elites
Daud Khan is a retired UN staff based in Rome. He has degrees in economics from LSE and Oxford, where he was a Rhodes Scholar; Alishba Khan is a qualified Chartered Certified Accountant (UK) and is based in Islamabad Listen to article Lahore is among the cities with the worst air pollution in the world; Islamabad is catching up; and even Karachi, despite its proximity to the sea and to the sea breeze, is impacted. The consequences of air pollution are well known. Breathing the cocktail of toxic chemicals affects the membranes in the nose and lungs, restricts the absorption of oxygen and also enters into the blood and other organs. It is associated with strokes, cardiovascular diseases, lung cancer and arthritis. Babies and young children are particularly vulnerable, and there is strong evidence linking air pollution and permanent damage on the development of their brains. The causes of the poor air quality in our cities are also well known. It includes transport and traffic; power plants, industrial units and factories, including brick kilns; and burning of crop stubble, other agriculture residues and solid municipal waste. The actions needed to address the problem include reducing emission from traffic; from industrial sources; and from the burning of crop residues and municipal waste. These are well understood and have been set out in the scientific literature, in the popular press and even in Government policy documents. If impacts, causes and solutions are known and understood, then why is no action being taken? The issue is particularly puzzling as there is adequate regulation and legislation to reduce air pollution substantially. Why are these laws and rules not enforced? One reason could be due to a phenomenon referred to as "elite capture". Reforms that are good for the country as a whole are not undertaken because they negatively affect the wellbeing of a small and powerful minority (the elite) who control decision-making institution and the implementing agencies. Could elite capture be the reason why the problem of air pollution is not addressed? Let us keep in mind that many of the richest and most powerful people in Pakistan live in Lahore, Islamabad, Rawalpindi and Karachi. They are obviously aware of the health impacts on themselves and their families; and their daily lives are affected by periodic closure of schools, public offices and other facilities due to air pollution. There are possibly two interlinked reasons for the inaction. The first is that Government and other public institutions lack the capacity to implement action. Many Government employees at local level, where actions have to be taken, are averse to doing anything. A large proportion of these employees are political appointees, or have paid hefty bribes for a job. Many are ghost workers who only turn up once a month to collect their salaries. These employees may have little inclination to implement difficult and unpopular directives. In fact, it would simply be unreasonable to expect that a low level officer of the agriculture department would try and stop a farmer burning crop residues, or an employee of the industries department would try to shut down or impose a fine on a polluting brick factory. A second reason could be that the educated urban elites, who understand the problems associated with air pollution and think that action is needed, are not really as powerful as they may appear. Yes, they may work in big companies and offices, hold important positions in the civil service or other Government institutions, or even be members of parliament. But when it comes to decision-making, others carry more weight. This could be the big landlords, factory owners, transport providers and those who formally or informally control services such as disposal of municipal waste. So, what needs to be done so that effective steps will be taken in time to prevent yet another winter of discontent? Clearly we need to bring in other actors into play – actors that would help address the issue of implementation capacity, as well as the issue of political will. One such actor could be the private sector. In a previous article, we had argued for exploring the use of carbon offsets to pay farmers, industrial units or other polluters to reduce emissions. However, going down this path would require substantial work and time, as these instruments are relatively new in Pakistan. Another option could be to involve civil society organisations, in particular those that cut across the urban-rural divide and the rich-poor divide. One such institution could be the religious leadership. It has often been argued that religious scholars, mullahs and other opinion-makers need to play a greater role in matters related to health, hygiene and drug abuse. In the same vein, it might be useful to enlist their help to explain to people the impacts of their behavior on air pollution. Yet another option, one that would have a quicker impact, could be to set up a joint special taskforce with members from different institutions, and give them the mandate of reducing air pollution to levels that are in line with international guidelines. Such institutional arrangements have been successfully put in place at other times, such as after the 2005 earthquake and during the Covid pandemic.
