CPEC 2013-23: Pakistan on way to food security

The agriculture sector – the backbone of low-income economies – has emerged as both direct and indirect beneficiary of the China-Pakistan Economic Corridor, which is approaching the 10th anniversary of its launch in Pakistan.

Agricultural development is the main component of the second phase of CPEC, which is being transformed into a “green corridor.” The major development of the agriculture sector falls under the long-term plan (LTP).

The plan focuses on increasing the use of modern machinery and synthetic fertilizers to enhance yields, while food storage and processing zones would be built to significantly reduce the post-harvest losses.

Similarly, the construction of cold storage stations and meat processing plants is planned to enhance the productivity of livestock and fisheries sectors besides making their output more competitive in the international market.

Being one of the countries included in the BRI initiative, Pakistan can benefit from China’s increased food import dependence and gradual transition towards high-value addition in the agriculture sector.

CPEC benefits for Pakistan’s agriculture sector

The Corridor promises to bring a turnaround in the agriculture sector by providing new avenues for further progress of this vital industry that contributes 22.7% to the nation’s GDP, and provides jobs to 37.5% of the working force. It’ll help farmers reach bigger markets where they can export their produce at cost-effective prices through roads, rails, and the sea.

Additionally, the expansion of agricultural land under the CPEC, which includes enlarging farms to increase productivity with the newest equipment and techniques, will be crucial in boosting the economy and GDP as a whole.

China also plans to outsource its agricultural supplies in the form of joint ventures by investing in and developing processing zones, warehouses, dairy farming and cold storage stations in Pakistan.

As of last year, Pakistan’s agriculture sector has gained manifold traction under the agricultural cooperation, promising a phenomenal agricultural growth.

 

Given the comprehensive spectrum of cooperation under the “Green Corridor” throughout the year 2022, the agriculture sector has recorded a remarkable growth of 4.4% and surpassed the target of 3.5% as well as last year’s (FY2022) growth of 3.48% as shown in the following table.

Pakistan Economic Survey 2021-22This astounding development is mainly due to China’s assistance to Pakistan in a variety of areas, including the transfer of hands-on expertise in the areas of intercropping, high-yield seeds, pest control, hybrid cultivation, corporate farming, innovative irrigation technique, agri machinery training, agri research & development, protocol for Pak agri exports to China, digital farming, and agri labour skills.

Agricultural projects under CPEC

Rs83 billion projects identified to modernize agriculture sector

As many as 18 projects worth around Rs83 billion have been identified in the agriculture sector, aiming to exploit its true potential and modernize it for sustainable economic growth.

• China and Pakistan are both determined to exploit this sector for mutual benefit as part of the second phase of CPEC.
• About 12 short, medium and long-term projects identified by the China-Pakistan Joint Working Groups (JWG) are related to the Livestock Wing, Ministry of National Food Security and Research (MNFS&R), and Livestock and Dairy Development Department, six projects are related to research and development to be executed by the Pakistan Agricultural Research Council, while one project has been identified for establishment of Aquaculture Park in the coastal areas of Pakistan.
• Through these projects, both countries would cooperate in the areas of capacity building, agriculture product processing, and technology extension.
• The other identified projects include uplifting of local agriculture sector, including fisheries, the establishment of foot and mouth disease-free zones, and market information as well as agricultural trade.
• The Ministry of Planning and Development had also signed an MOU with its Chinese counterpart to bring two Joint Working Groups (JWGs) – Agricultural Cooperation and Science Technology under the CPEC.

 

The joint collaboration will execute the following major developments in the agriculture sector:

1. Establishment of Pest Control Centre: Both sides have agreed to establish the Centre for Sustainable Control of Plants Pest Diseases in Pakistan (Karachi) with the Department of Plant Protection as the lead executing agency.
2. Cherry cultivation: The seven projects to be executed by the PARC include the promotion of cherry cultivation on commercial scale in Gilgit-Baltistan for taping the export potential to China. The project will complete within five years with an estimated cost of Rs1,200 million.
3. Dry fruit production: The Northern Areas of the country have an enormous potential to produce dry fruits which have a large market in China for export.

• Promotion of pistachio: Recognizing the potential of Northern Areas, the JWG has also identified project promotion and development of pistachio in Pakistan. The estimated cost of the initiative has been calculated at Rs1,300 million and it would be completed within five years.
• Peanut cultivation project: The Chinese company, Shandong Rainbow Agricultural Technology, has had its high-oleic-acid peanut cultivation project included in the China-Pakistan agricultural cooperation framework. Five high-oleic peanut varieties for oil extraction have been trial-planted in Pakistan and will eventually cover 1,500 hectares. Rainbow is working with the Chinese government to establish a lab to test the quality of peanut oil, and will also assist in the formulation of unified standards for the product in Pakistan. The aim is to improve the local edible oil structure, upgrade the entire peanut industry and help Pakistan reduce its dependence on edible oil imports.

2021. Intercropping Research Centre: An Intercropping Research Centre – a joint venture between Sichuan Agricultural University and Islamia University of Bahawalpur – was inaugurated in 2021.

• Maize-soyabean intercropping: The 2022 season showed impressive results for China’s maize-soybean strip intercropping technology, with harvests at 65 demonstration sites in Punjab, Sindh, and Khyber Pakhtunkhwa. Maize and soybean production reached 8,490kg and 889 kg per hectare, respectively, in intercropped fields. Compared to the production of solely cropped maize and soybeans, which are 8,995kg and 1,531kg per hectare, respectively, the intercropping technology creates significantly more economic benefits.

Researchers are also developing strip intercropping systems for maize-peanut, maize-pea, sugarcane-soybean, sugarcane-mustard, wheat-mustard, wheat-soybean, wheat-chickpea, potato-maize, and canola-pea.

• Sugarcane wheat intercropping: The National Research Centre of Intercropping (NRCI) of the Islamia University of Bahawalpur has recently conducted intercropping of wheat with sugarcane.

1. Pakistan-China Joint Cotton Research Laboratory: Under the framework, a joint cotton research laboratory has been established in Multan at a cost of Rs186 million to help improve the agriculture sector’s productivity by increasing the cotton cultivation area and production. It will also help in the development of climate-resilient cotton varieties that will ensure reliability and productivity. Now a Chinese seed company has started trials of single and triple-gene cotton in Pak varieties.
2. Hybrid wheat and rice varieties: The CPEC has facilitated joint efforts to develop high-yielding hybrid varieties of wheat and rice. The universities of Punjab and Wuhan are collaborating to produce hybrid rice varieties using modern technologies to increase the Pakistani rice exports. Similarly, hybrid wheat is seen as crucial for food security in Pakistan. Introducing hybrid varieties could enhance yield and quality, improving grain quality in both cross- and self-pollinated crops.
3. Establishment of potato tissue culture lab: Shandong Rainbow Agricultural Technology in collaboration with the Pakistani companies is establishing a potato tissue culture laboratory in Pakistan.

The laboratory aims to produce high-quality potato seeds locally, reducing the country’s dependence on expensive imported seeds. With support from the Shandong Academy of Agricultural Sciences, the project plans to produce 1,500 tons of seeds initially, expanding to 10,000 tons in the future. This will save the foreign exchange reserves, increase the farmers’ incomes, and potentially enable Pakistan to export potatoes to other countries.

1. Chinese hybrid canola seeds: To help Pakistan meet its edible oil demand and support its foreign exchange reserves, the Chinese company Wuhan Qingfa Hesheng and Pakistani company Evyol Group jointly provide high-quality hybrid canola seeds to the Pakistani farmers.
2. Pakistan-China chili farming: In June 2021, an initial pilot project to test the feasibility of growing chilis in Pakistan with the intention of exporting them to China was successfully completed. The experiment on 100 acres of land has been a great success, with initial estimates showing that the farmers can earn Rs100,000 per acre. On the other front, Sichuan Litong Ltd. and China Machinery and Engineering Corporation have started contract farming in Punjab and Sindh on 400 hectares and are providing the local farmers with technology and training to grow high-quality chilis.

The project aims to expand operations to 10,000 hectares and establish a chili processing plant. If successful, this may open other avenues for export for Pakistan as well. The potential is massive, with six model farms achieving a bumper harvest of 700 tons of dried chilies, and over 1,000 jobs created.

1. Establishment of FMD-free zone: Pakistan has signed an MoU with the Chinese government to establish foot and mouth disease-free zone with vaccination.
2. Embryo production for high-milk-yielding cows:  To improve the genetic variations of cows being used in Pakistan for dairy farming, the Royal Group of China has established a laboratory in Lahore for assistance in producing high-yielding cows through the development of buffalo embryos of elite animals and plans to set up an 8,000-head buffalo dairy farms.

 

CPEC Agriculture Cooperation Centre

Talking to WealthPk, Dr Muhammad Azam Khan, Director CPEC-Agriculture Cooperation Centre, said the CPEC was officially launched in 2013 as a pilot project to pursue the goals of the Belt and Road Initiative. Although the Corridor focused on all sectors, it had a special focus on agricultural cooperation to combat the challenge of food insecurity in Pakistan.

The cooperation framework has been designed in accordance with the needs of Pakistan. China is willing to help modernize the agriculture sector. The PMAS-Arid Agriculture University, Rawalpindi, took it as an opportunity to contribute to the national cause and decided to create a dedicated centre under the name CPEC-Agriculture Cooperation.

This centre will serve as the central point to engage stakeholders and assist the government in policy discourse and implementation. The centre is expected to be leading the efforts of the universities, research institutes and private businesses from China to collaborate in terms of technology transfer, policy reforms and joint ventures of mutual interest.

Vision

To be a centre of strategic foresight to understand the opportunities offered by the agriculture cooperation under CPEC and assist the government in converting the opportunities into reality.

 

Objectives

• To conduct policy research to assist the government in decision-making
• To facilitate the Chinese companies to work in Pakistan
• To promote institutional cooperation
• To act as the centre of excellence for work in the arid areas of Pakistan

Addressing challenges in agriculture industry: Despite the fact that a lot of agricultural projects are in the pipeline, still China Pakistan will have to tackle longstanding roadblocks in order to fully benefit from the potential of the agriculture sector. The challenges include:

• Strengthen the upgradation of agricultural infrastructure in the regions along the CPEC.
• Promote the construction of water-saving modern agricultural zones, and increase the development and remediation of medium- and low-yielding land to achieve efficient use of resources.
• Strengthen the drip irrigation technology for water efficiency.
• Improve post-harvest handling, storage and transportation of agricultural products, and innovate in marketing and sales models.
• Improve water resources operation and management, strengthen development of pastoral areas and desert, and promote application of remote sensing technology.

Conclusion: Agriculture is a significant sector of economy, employing around 37.5% of the country’s workforce and contributing 22.7% to the GDP. However, this sector faces several challenges, such as the lack of modern technology, low productivity, and insufficient investment.

As a major player in the global agricultural market, China has been working with Pakistan to address these issues and enhance cooperation in this sector.

The CPEC’s second phase is all about agricultural development, and both China and Pakistan are determined to take full advantage of it.

The two countries have already signed a number of agreements and MOUs for cooperation in various areas of agriculture, including seed development, livestock breeding, irrigation systems, and modern agricultural technologies.

With CPEC, we’ll see a turnaround in the Pakistani agriculture sector and new avenues for growth. Despite the fact that the China-Pakistan agricultural cooperation has spurred a lot of growth in the country’s agriculture sector, there are also challenges to be overcome, such as the differences in the climate and agricultural practices between the two countries. This will require sustained efforts and cooperation from both sides to achieve the desired outcomes.