Agricultural Commodity Markets in Pakistan: Analysis of Issues

Abstract

EXECUTIVE SUMMARY Agriculture markets in Pakistan are still primarily based on a colonial-era model and have not modernised with changing times. This has increased unnecessary costs in the supply chains that put growers and end-consumers at a disadvantage. Additionally, price and supply volatility causes insecurity for policy-makers as information about prices, supply and demand is not structured, timely or reliable. For decades, agricultural markets have functioned without government focus on innovation. Recent initiatives from various federal and provincial agencies provide hope that this vital area can now finally be addressed. Numerous constraints need to be resolved to bring meaningful change to the ecosystem. The process must start with a fresh policy look and commitment to adopt modern themes. This policy process can be supported by technology and successful lessons from other countries as well as developments in other sectors within the country. There is a need to develop a certain level of coordination between various federal and provincial agencies. The increasingly fragmented nature of agriculture markets might be useful for some stakeholders as they can innovate according to their needs but it leaves most of the sector at a continually suboptimal level. The lack of progress in modernising core markets has also made it difficult for some innovative solutions to succeed. A rapid assessment of the current environment, key constraints and recommendations for possible development areas is presented in this report.