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AgriTech: Crafting Pakistan’s Journey to Impact

 

Read and download the complete report here. 

Agriculture in Pakistan

Agriculture is a key sector for Pakistan’s economy as the highest employer of the labour force, with nearly 40% (or around twenty-five million adults) of the country’s employed population working in within the sector. Ten million of these are female—which translates to roughly 70% of Pakistan’s female employed labour force. Agriculture also constitutes approximately 20% of the country’s Gross Domestic Product (GDP), amounting to USD 57 billion in 2021. This makes it the second-highest contributing sector of the economy, after services and followed by industry. Agriculture is instrumental for a host of other major sectors of the economy as it generates the primary inputs and raw materials that fuel the spectrum of firms, from small- and medium-sized enterprises (SMEs) to large-scale manufacturers (LSMs).

 

Even though Pakistan is categorised amongst the largest agricultural countries, its crop yields are much lower than international benchmarks. Key challenges deterring the growth of Pakistan’s agriculture sector include limited access to formal financial services, high reliance on intermediaries and informal markets to service farmer requirements, limited access to high quality and timely inputs, storage inefficiencies that lead to wastage of agriculture produce, and subpar public service delivery to support farmers’ needs.

 

To address these chronic issues and craft Pakistan’s journey to social and economic impact, a long-term approach that benefits both the producers and consumers of Pakistan’s agricultural products is critical. With global food security and zero hunger as part of the Sustainable Development Goals (SDGs), and the Fourth Industrial Revolution (4IR) driving hyper-paced advances in economic and social interactions, a critical sector like agriculture merits transformation through structural shifts to embrace technology and digitisation at its core.

 

GSMA’s work on impact enabling technologies has resulted in a conceptual framework for mapping digital agriculture services in five core categories that represent use-cases aligned with the agriculture value chain:

  1. Digital advisory services: Access to information to bridge gaps and asymmetry for farmers.
  2. Digital procurement: Enabling mechanisms for inputs and traceable digital record keeping and transactions.
  3. Agricultural e-commerce: Use of online platforms to facilitate transactions across the agriculture value chain between farmers, aggregators, input providers, and consumers.
  4. Agricultural digital financial services: Provision of mobile and internet payment platforms, credit support to farmers and other services like insurance to service financial requirements.
  5. Smart farming: Use of emerging technologies and solutions like sensors, drones, and satellites to generate and transmit data regarding specific crops, livestock, and farming practices.

 

The spectrum of use-cases offered by increased use of technology and digitisation in agriculture offer a massive opportunity set for Pakistan to fast-track the adoption of modern agricultural techniques that boost national outputs. This can lead to improved outcomes across a range of socioeconomic dimensions as follows.

 

Impact of AgriTech

Economic Impact

Food Security: Higher production and better utilisation of produce through reduced wastage will increase reliance on domestic sources to service Pakistan’s growing demand for food crops. This aligns very closely with the priorities laid out in the National Security Policy 2022 where food security is one of the primary pillars of national security.

 

Economic Growth: A better performing agriculture sector can help contribute to GDP growth. Increasing average national yield for crops by 30% and reducing post-harvest waste by 75% alone can result in an annual additional impact of USD 8 – 10 billion.

 

Farmer Prosperity: Smallholder farmers who own five acres or less comprise about 75% of the total agricultural workforce. Through increased profitability, AgriTech can reduce the economic divide between large and small farmers to improve farmer prosperity.

 

 

Social Impact

Financial Inclusion: Less than 30% of Pakistan’s population is financially included. By digitising transactions and increasing access to credit and loans for small farmers, AgriTech services can become entry points for farmers to become financially included, and eventually create avenues for an increased footprint of digital transactions.

 

Gender Gap: Of Pakistan’s employed female labour force, approximately 70% work in agriculture. This presents a massive window of opportunity to address some of the structural challenges that have led to a gender divide, especially in rural areas. Bringing Pakistan’s ten million female agricultural workers into the digital financial fold through agri DFS can double overall female financial inclusion through a single use-case.

 

Youth Participation: With a median age of 23 years, 64% of Pakistan’s population – estimated at 140 million – is younger than 30. A significantly evolved agricultural landscape powered by the promise of technology will not only attract tech-savvy and digitally literate younger age groups to improved economic prospects, but will also create an added incentive to drive innovation and impact in the rural economy, thereby reducing the stress on unplanned and unsustainable urban sprawl.

Sustainability And Climate Resilience

Pakistan is a water-scarce country that may face significant challenges by 2025 and yet continues to operate irrigation systems that result in 60% water waste. By optimising use of precious resources, AgriTech can help to make Pakistan more climate resilient. This can be achieved by optimising the mix of inputs, dissemination and adoption of smarter agriculture practices, and innovative financing models for transitioning to improved infrastructure.

Agriculture as a sector is central and connected to a number of Sustainable Development Goals, with the potential to drive cross-sectional impact across a wide range of social and economic development priorities for Pakistan. AgriTech can help improve these impact chains to accelerate improved outcomes and cement Pakistan’s international commitments to SDGs.

Read the complete report and recommendations by downloading the PDF here. 

+ posts

Umar Nadeem is the Head of Advisory at Tabadlab. He works at the intersection of evidence, technology and policy with experience in policy analysis, design and management of large-scale programmes and digital transformations, and has led multi-disciplinary portfolios advising governments and corporations in Asia, Europe and Africa. Umar holds a Master of Public Policy (MPP) from the Blavatnik School of Government, University of Oxford.

Aliza Amin
+ posts

Aliza Amin is a Policy Associate at Tabadlab’s Centre for Digital Transformation, where she is responsible for research and analysis of the policy landscape, evolution of digital ecosystems and advisory for transformations. She has been a researcher at Wellesley College and MIT and has worked with non-profit organisations in Pakistan, Morocco and the United States. Aliza graduated from Wellesley College in 2020.

Saad Arshad
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