Abstract
Recent economic events in West Pakistan provide us with a classic example of agricultural/manufacturing interaction in a developing economy; study of this case may add to our understanding of the growth process and generate some policy guidance. The growth of agricultural output in West Pakistan was rapid, 3-6 percent per annum, during the Second Plan period of 1961-65. The rate of growth peaked at a phenomenal 15 percent during fiscal 1967-68 of the Third Plan period, which ended in 1970. The new fertilizer-responsive, dwarf varieties of grain accounted for most of this increase; from 1966 to 1969 wheat and rice production in West Pakistan increased by 79 percent and 61 percent, respectively.' A concomitant of this rapid growth of the agricultural sector was the burgeoning of a small-scale engineering industry which supplies key durable-goods inputs, mainly diesel engines, pumps, and strainers, but also various farm implements. This growth industry, concentrated in various centers around the Punjab region, attracted our attention because of three important considerations: (1) It is a clear and specific example of industrial/agricultural interaction; that is, agricultural growth has generated demand for output of the domestic manufacturing sector, and, contrariwise, the supply of agricultural inputs has been the sine qua non of the Green Revolution in West Pakistan.2 (2) The
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