The place of agricultural development in the economic development of Pakistan

Abstract

The topic studied in this thesis seeks to explain that in Pakistan the over all economic growth rate is very much correlated with the agricultural growth rate. Therefore, integrated development efforts necessarily mean the transformation of the massive sector like agriculture. The first three chapters deal with the basic problems of population growth and per capita supply of food, the problems of capital formation in the agricultural sector and agricultural taxation. The study of these problems reveal that since a check on population is not possible in the short run, the supply of food requires to be boosted to match the population growth rate. To elevate the agricultural sector" from desperate poverty two methods have been suggested: i) use of surplus labour for capital formation; and (ii) increased rate of selective agricultural taxation. In chapter four the problems of labour redundancy are studied and it is found that land-labour ratio is very low in Pakistan, largely due to disguised unemployment. Under these conditions major technological change is not possible as this would mean a partial replacement of agricultural labour by capital. The labour absorptive capacity of all other sectors is low because of the fact that capital intensity for all other sectors is high compared to the agricultural sector. Therefore, the absorptive capacity of the agricultural sector itself will have to be enlarged by more intensive cultivation. In the fifth chapter the dualistic growth model and the impact of agriculture on industrialisation is examined. It is concluded that for an expansion in the industrial sector, the expansion of the agricultural sector is essential. An expanded agricultural sector would not only supply cheap food to the industrial sector, but it may also earn much needed foreign exchange for development imports and increased effective demand would also be forthcoming from this sector. In the sixth chapter the importance of agricultural sector is studied in the context of previous chapters and it is clear that agriculturalists in Pakistan are quite responsive to technical change and even to prices and profitability. The speedy transformation of the agricultural sector not only requires the building of an adequate infrastructure but also an improvement in the supply factors. In this connection, keeping in view the fact that capital is a scarce factor in underdeveloped countries; a single factor development approach has been suggested.