A large trade deficit has remained one of Pakistan’s most persistent and deep-rooted structural economic challenges. In the past, this chronic imbalance between imports and exports has led to the accumulation of huge foreign debt and a continuous depletion of the country’s foreign exchange reserves.

In FY24, the trade deficit stood at $24.09 billion and is projected to widen further in the current fiscal year. This reflects a dual policy failure: the absence of a holistic export development strategy and the inability to implement an effective import substitution plan, at least for products in which Pakistan holds a comparative advantage.

The agriculture sector — often described as the backbone of Pakistan’s economy — has followed a similar trajectory. In the absence of a comprehensive, result-oriented export development strategy and its backward integration with farms through contract farming or other development approaches, farmers have independently shifted to crops that offer relatively better returns or align more closely with their available resources.

This directionless growth has led to increased production of crops like rice, maize, and sesame, and consequently to higher exports, albeit in raw or minimally processed form. However, concerns about the sustainability and long-term viability of these crops loom large.

The persistent lack of strategic planning and a weak government investment and development strategy to strengthen agro-processing has stunted the agriculture sector

Rice — Pakistan’s top agricultural export — is a highly water-intensive crop.........

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