Shafaqna Pakistan | by AK Haq- Pakistan’s agricultural sector is facing a critical situation, with climate change impacting crop yields and the tractor industry nearing collapse, a combination that could have severe repercussions for the country’s economy.
Climate change is already adversely affecting Pakistan’s rice production, with rising temperatures and frequent heatwaves during the Kharif season reducing yields by one-third, particularly in Sindh province. As a staple food and key export, rice is essential to both domestic consumption and foreign trade.
Meanwhile, the tractor industry, crucial for efficient farming, is on the brink of shutdown following a 10% sales tax implemented in June 2024, which had previously been exempt. The Pakistan Association of Automotive Parts and Accessories Manufacturers (PAAPAM) warns that prolonged delays in releasing General Sales Tax (GST) refunds by the Federal Board of Revenue (FBR), along with complications from a new GST regime under Statutory Regulatory Order (SRO) 563, have pushed the industry to the edge.
The potential collapse of the tractor industry threatens to undermine agricultural productivity, especially as farmers already grapple with the effects of climate change. Without affordable tractors, farmers will struggle to manage their fields, leading to delays in tilling, planting, and harvesting. This will likely exacerbate the decline in crop yields driven by extreme heat, further compromising the supply of staple foods like rice and deepening Pakistan’s food security crisis.
If the tractor industry fails, farmers may be forced to rely on outdated and inefficient farming methods, raising costs and reducing income, which could trap them in poverty and limit their ability to adapt to climate change. Already burdened by rising temperatures, droughts, and floods, the plight of farmers would worsen.
The consequences extend beyond agriculture, as Pakistan’s economy heavily depends on agricultural exports, especially rice. In the fiscal year 2023-24, rice exports saw a 62% increase in volume and an 83% rise in value compared to the previous year. However, this growth is at risk as climate impacts and reduced mechanization threaten both the quantity and quality of rice production. This decline could harm Pakistan’s export capacity, decrease foreign exchange earnings, and lead to further economic instability.
Immediate and coordinated action from the government, industry stakeholders, and agricultural experts is urgently needed. The current approach, which tightens the constraints on farmers, risks endangering food security, poverty reduction, industrial development, and national stability. If farmers are weakened, the nation’s prospects for stability and development will be severely compromised.
The intersecting threats of climate change and the potential collapse of the tractor industry could create a disastrous scenario for Pakistan’s agriculture sector. This would significantly undermine food production, jeopardize farmers’ livelihoods, and worsen the already fragile state of food security nationwide. The government must acknowledge the plight of its farmers and take swift action to prevent the collapse of the tractor industry, or face dire consequences for the country’s future economic stability and food security.
Source: Shafaqna Pakistan
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