Agriculture sector still holds hope for ailing economy

September 04, 2023 (MLN): The agriculture sector still holds significant prospects and opportunities, foreseeing high investor interest to revitalize the ailing economy of Pakistan, which grapples with the critical issue of survival.

Lately, the Green Pakistan Initiative, an effort under the newly formed Special Investment Facilitation Council (SIFC) will be proved to be the catalyst for the most attractive investment opportunity in Pakistan, the latest report by KTrade Securities noted.

Over the last couple of months, most local business groups that we met are gearing up to invest in corporate farming. The momentum and support for the initiative is very strong.

“Also, our meetings with foreign investors, especially in Saudi Arabia and China indicate strong investor interest,” according to Ali Farid Khwaja, Chairman KTrade Securities.

“In our opinion, triggered by the Green Pakistan Initiative, the agricultural sector could be the hottest theme in Pakistan over the next five to ten years,” he added.

The government is targeting $50 billion investment over the next five years and even if only a fraction of this can materialize, it could have a multiplier impact on the economy and the society, the report noted.

Agriculture is a scalable sector where Pakistan could have an inherent competitive advantage. It can also be a source of dollar earnings which the economy needs.

It is also encouraging to see that the government has shifted away from its perennial fascination with real estate and construction sectors into more productive sectors of the economy such as agriculture, mining and technology.  

The report further highlighted the most attractive investment opportunities in the sector including rice and meat exports, seed technology, olive plantation and forestry.

It also found massive potential in logistics, supply chain, agri-tech and water conservation. In the listed space, food and agriculture related companies such as Matco Rice, Millat Tractors, The Organic Meat Company, Engro would also benefit from the structural growth in the sector.

It is important to mention that Pakistan has a total area of 79.6 million hectares. Out of this cropped area is 23m and forests cover 4.6m hectares. Pakistan’s agriculture sector annual income last year was $38bn (23% of GDP).

Pakistan is the 15th largest agriculture producer globally. Pakistan is also amongst the world’s top ten producers of wheat (7th), cotton (5th), sugarcane, mango (6th), dates and kinnow oranges, and is ranked 10th in rice production.

Despite this, over the last few years, it has become a net importer of wheat. Climate change and water scarcity have created a threat to food security.

Thus, this Green Pakistan Initiative is not only an opportunity, but it is also critical for the sustainability of the domestic economy.

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