Growth Agriculture will lead to Breaking the Cycle of Rural Poverty

The 35th World Food Day had been observed in Pakistan on Friday October 16, to create awareness on the issue of hunger and help develop strategies for ensuring food security. This year, the theme of the World Food Day is "Social Protection and Agriculture: Breaking the Cycle of Rural Poverty," which aims to sensitize the people about eradicating rural poverty and ensuring food protection for all.

The pattern of poverty in Pakistan is complex varying between the agricultural and non-farm sectors between ethnic tribal groups and between provinces and within provinces. The agricultural sector is the largest employer in rural areas. Many recent analysis of large international and interregional data sets show that the structure of the agricultural growth is a major factor in explaining the bulk of rural poverty reduction and the results of these analysis provides us a picture of future scenario, agricultural growth have negative impact on rural poverty in the subsequent 10-year period. Finally, the impulse response of poverty revealed that a 10 % increase in poverty would reduce the agricultural income by 2 % and this may continue in the next 10 years. The findings suggest that the government should focus on poverty equivalent growth rate in agriculture rather than the actual growth rates. In order to improve PEGR, the poverty alleviation policy must be in tandem with rational income distribution. There is a need to target public sector development expenditures to particular regions because of having high incidence of poverty. Thus checking vulnerability would offer wide option for the policy makers to settle the issue to the severity of poverty in the future.

Early classical theory viewed economic development as a growth process requiring the systematic reallocation of production factors from a primary sector characterized by low productivity, traditional technology, and decreasing returns to a modern industrial sector with higher productivity and increasing profits (Adelman, 2001). Agriculture was seen as a low-productivity, traditional sector that only passively contributed to development by providing food and employment. During the last decade not a mentionable long-term changes in rural poverty have been observed. There is no significant change observed in social welfare indicators. Furthermore, Pakistan economy is very badly affected because of global economic recession which has raised the poverty level at present. These economic and political conditions ask for very practical measures and steps by the government to overcome these problems. There are significant downward rigidities in government current expenditures, while due to less flexibility on revenues side, the government have no option except to cut its development expenditures, raise tariffs and taxes and reduce subsidies. In particular, defense spending and interest costs on the country’s rising debt absorb approximately three-fourth of revenues. Majority of people in agriculture sector are poverty ridden. It can be observed that poverty in Pakistan is the result of the interaction of economic, political, social and legal processes and the failure of any of the institutions has been translated to governance problem that has exerted bad impact on the poverty reduction efforts. For a comprehensive rural growth and poverty reduction strategy the following suggestions are made: i. there is a need to improve governance and rural public service delivery. ii. For achieving sustained economic growth for reducing poverty in rural areas through the provision of basic economic, political, social and legal services need to be provided to the rural population of the country on priority basis. iii. Expenditure on health and education in rural areas may be helpful in reducing poverty in rural Pakistan.