138
The Technical Potential for
Increasing Labour Absorption
in Agriculture
INTRODUCTION
On the basis of the existing production conditions in
Pakistan’s agriculture, we have estimated that in the Punjab
alone, the labour requirement for crop production is 578.53
million man days per year. According to the 1972 Census of
Agriculture there were 2.57 million farm households, (with 6.5
members per household). This means that the farm population
in the Punjab in 1972 was being ‘maintained’ on the basis of
225.10 man days of labour per household, per year.
The existing technical conditions and the social
organisation of agricultural production are such that the
prevailing level of labour absorption is inadequate to maintain
even the existing farm population at a minimum standard of
living. Thus for example a field survey in 1978 showed that in
5 of the principal irrigated districts of the Punjab, 23% of
farmers in the size class below 8 acres were unable to provide
a subsistence income for their families and were obliged to
obtain Consumption loans for achieving a subsistence level of
consumption. If we consider the economic condition of the
poor peasantry over time we find that in the period 1965 to 1978, 139
33% of farmers in the size class below 8 acres suffered a
deterioration in the quantity of diet and 67% and experienced
a deterioration in the quality of diet.’ According to the study
on rural poverty by Naseem, 74% of the rural households in
Pakistan in 1971-72 had an income so low, that they were
unable to consume even 2100 calories per day per household
member. By 1979 this figure had reached 63%2
.
If the existing rural population is to receive adequate
nutrition, and if the farm sector is to increase its capacity for
labour absorption in the future two kinds of changes would
have to be brought about:
(1) Realizing the considerable technical potential
of Pakistan’s agriculture in terms of:
increased crop yields;
reclamation of land within the
existing canal- commanded area; and
increasing the farm gate availability
of water through increased irrigation
efficiency.
(2) Institutional changes in rural society designed to
reduce the inequality in the distribution of land
ownership, and to improve the access of the small
farmers over agricultural inputs, in order to improve
the distribution of agricultural income. Such
changes may be particularly advisable in a situation
where as we will show, large landowners tend to
resume land formerly rented out to smaller farmers,
for self-cultivation on large farms, using
increasingly mechanized techniques. Such a
tendency at the level of social organisation of 140
agricultural production may be reducing the labour
absorptive capacity given the prevailing technical
conditions in agriculture.
In this chapter we will discuss the technical potential
of Pakistan’s agriculture for increased production a
labour absorption. In the subsequent chapters we will
e, the social dynamics of Pakistan’s agrarian structure
and the implications for labour absorption.
SECTION I
THE POTENTIAL FOR EXPANDING YIELDS
PER ACRE
The technical potential for increased agricultural
production and labour absorption in Pakistan is based
essentially on three factors:
(1) Pakistan’s crops yields for each of the major
crops are about one-third of the potential of the
particular seed varieties being used. (See Table 2).
(2) There are 21.8 million acres of land in the
existing canal-commanded area which can be
reclaimed for irrigated cultivation. (See Table 3).
(3) There are about 38 million acre feet (MAF) of
water that can be added to the present farm gate
availability of 73 MAF, by n of Investment in
canal remodeling surface storage and
groundwater development. 141
In estimating the yield potential an acre of Irrigated
being operated at the current average level of productivity
(See Table 2, Column ‘A’), is taken as the numeraire. In the
case of unirrigated saline or waterlogged land investments in
land reclamation and irrigation expansion would be required
before such land can be converted into the numeraire. The
yield potential is defined as the ratio of the median of upper
range of the frequency distribution of yield per acre, to the
weighted mean. Since the yield potential is defined in terms of
the upper range of observed yields, it represents effective use
of current technology, rather than employing some future
technology.
Realizing the yield potential involves four ‘technologies’:
(a) The first level involves improved cultural practices.
(b) The second level involves using-high yielding
varieties, fertilizer, water, pesticide inputs.
(c) The third involves using increased draft power
(usually mechanical, given the imperfections of the
labour market) to ensure increased cropping
intensities.
(d) The fourth level involves increased use of fertilizer
and water along with their timely application.
The three principal determinants explaining the
difference between the yields in the upper and lower ranges of
the frequency distribution are:
— fertilizer;
— water; and 142
— improved cultural practices.
Let us consider the yield response of each of these
factors in the WAPDA XAES data, for wheat, maize and
Cotton respectively.
TABLE 1
LABOUR ABSORPTION POTENTIAL IN CROP
PRODUCTION IN PUNJAB UNDER EXISTING
PRODUCTION CONDITIONS
(Millions of Man Days Per Year)
With Tractors at
1975 Use Level. Without Tractors
Irrigated
acreage
labour
requiredment
Unirrigated
acreage
labour
requiredment
Total
Labour
requirement.
Irrigated
acreage
labour
requiredment
Unirrigated
acreage
labour
requiredment
Total
Labour
requirement.
511.809 66.722 578.531 620.951 98.267 719.218
Source: i) Pakistan Census of Agriculture, 1972.
ii) Pakistan Census of Agricultural Machinery, 1975. 143
iii) WAPDA XAES Labour Coefficients, 1979.
Note: Estimates of labour requirement are based on the cropping
Intensity, cropping pattern, yield/acre, landuse Intensity,
Irrigated area and area covered by tractors, prevailing in
1972.
TABLE 2
POTENTIAL FOR INCREASING YIELDS
OF MAJOR CROPS
Weighted
Mean
Median of
Upper Range
Potential
(B/A) x 100
(A) (B)
Maunds/Acre Maunds/Acre Percent
Wheat
Cotton Seed
15
7
50
18
333
257 144
Rice
Maize
Sugarcane
20
15
320
55
45
850
275
300
266
Source: Revised Action Programme for Irrigated Agriculture
Main Report, Vol. II. Master Planning and Review
Division WAPDA, May 1979, Page VII-55.
TABLE 3
STATUS OF RECLAMABILITY
(Million Acre Feet)
Usable
Groundwater.
Unusable
Groundwater. Total
Land requiring
drainage.
---Early Sub-Surface
Drainage 7.3 4.2 11.5 145
---Later Sub-Surface
Drainage
---Surface Drainage
including rice area
0.5
---
2.0
---
2.5
7.8
Total 7.8 6.2 21.8
Source: Revised Action Programme for Irrigated
Agriculture, 1979.
(1) It appears that the yield per acre continues to
increase in the case of each of these crops even
beyond an irrigation level of 20 inches,
although the marginal product of water
application beyond 20 inches is not as high as
in the range 10 to 20 inches of irrigation.
(2) Table 4 shows the yield response to increasing
application of fertilizer dosage at an irrigation
level of 18 inches. It has been observed that
fertilizer use levels are strongly Influenced by the
availability of water supplies. Thus the total
marginal effect of increasing water, supplies is
significantly greater than the marginal effect of
water alone. However, it is important to point out 146
that there are often institutional constraints to
increasing fertilizer application in response to
increased supply of irrigation. Given the
impoverishment of the small farmer and his lack
of social influence, he is often unable to mobilize
the funds to purchase the fertilizer at the required
time. Similarly in cases where he buys the
tubewell water of a neighbouring large farmer,
the small farmer finds his water application
delayed as well. Thus the yield response to waterfertilizer
application is likely to be lower in the
case of poor peasants due to delayed application.
(3) Since cultural practices are constituted by a set of
activities, estimating the marginal returns directly
becomes problematic. Indirect evidence, however,
indicates that the marginal value of improved cultural
practices may be quite high. For example evidence
from a Four Year Training and Visit System operating
in Rajasthan, India, is shown in Table 5.
TABLE 4
MARGINAL PRODUCT OF FERTILIZER
Water Supply = 18 inches
Fertilizer
Use Level
Marginal
increase in
fertilizer
application
Marginal
increase in
crop yield
Kg. / Acre.
Cop Yield
fertilizer use
ratio. 147
Kg. / Acre.
A B B/A
22
40
70
12
18
30
120
105
56
10
5.83
1.87
Source: Revised Action Programme of cit. Page VII-60. 148
TABLE 5
CROP YIELD INCREASES FROM IMPROVED
CULTURAL PRACTICES (Rajasthan, India.)
Maunds /Acre
1974 1978
Paddy
Sorghum
Wheat
22.8
4.3
13.0
47.9
8.7
25.0
Source: Revised Action Programme, Page VII-64.
An approximate doubling of yields over the 4-year
period is attributed to the following efforts by the extension
staff:-
i) Use f high-yielding varieties.
ii) Use of certified-seed.
iii) Seed treatment by saline water.
iv) Optimum plant densities.
v) Maintenance of optimum plant population by
gap filling. 149
vi) Fertilizer use by criss-crossing.
vii) Plant protection.
SECTION II
ESTIMATED GROWTH RATE OF PRODUCTIVITY
The WAPDA-expanded A S gives figures for net value
per acre at 1978 prices for each ample farm. The median value
comes to Rs. 500 per acre, on the basis of present crop yields,
cropping intensities, fertilizer use levels, water supply levels
and cultural practices. Assuming that the levels of additional
investments in irrigation improvements and technology
adoption rates could be achieved by the year 2000, the average
productivity could be raised to Rs. 1500. The growth path
from the present Rs. 500 per acre to Rs. 1500 per acre was
estimated by using a modified exponential function of the
form: Y == K — Le –ex. Two functions were derived. The first
specifying the growth path of productivity of land requiring
drainage/ recommendation from Rs. 150 to Rs. 500 to the
target level of Rs.3500 per acre. The avenge growth rates over
the 20-years period as shown in Table 6 is 5.3%, but the
growth rates in the earlier years are substantially higher than
growth rates for later rears. Introduction of new technologies
or changes in cropping patterns during the growth process
could prevent growth rate from slowing down in the later
years. For pie In the case of Pakistan the introduction of high
crops, the shifting of wheat to unirrigated regions, of dairying, 150
introduction of sprinkler irrigation significantly raise the
estimated value in the year 2000, well above Rs. 1500 per
acre. If such changes do occur then the estimated net value per
acre in the year 2000 may well Uêf1ne the lower bound of the
potential of agriculture. 151
TABLE 6
GROWTH RATES OF PRODUCTIVITY
No. of years from
Base year (1980)
Productivity Level.
Rs. Per (Acre)
Growth rate per
Annum (Percent)
3
5
10
15
20
Average growth
rate: 1980 to200
807
957
1200
1340
1415
------
10.5
6.9
3.0
1.5
0.8
5.3
Source: Revised Action Programme of cit. 152
SECTTON II
LAND EXPANSION POTENTIAL AND ADDITIONAL
WATER SUPPLY POTENTIAL
1) LAND EXPANSION
In the following Table 7 ‘Land Requiring Drainage’
includes saline land that can be reclaimed by leaching. The
total amount of land that can be reclaimed under the
‘maximum effort’ estimated by WAPDA, comes to 21.8
million acres. This area lies within the existing canal
command. Additionally 6 million acres of potentially irrigable
land could also be brought under irrigation through canal
extension and groundwater development in un commanded
areas. Thus a total of 27.8 million acres of new land could be
brought under irrigated cultivation by the year 2000, if
investment is made in all the major modes of land
development, i.e., tiles, tubewell drainage surface drainage,
canal extension, and guiding and facilitating reclamation
efforts.
2) ADDITIONAL WATER SUPPLY POTENTIAL
Apart from land reclamation, realizing the agricultural
potential would also involve increasing the irrigation supply to
the crop root zone. This could be done by increasing both the
delivery and application efficiencies of irrigation.4
At The
present time water supply in the Indus Basin is 25% short of
the optimal crop water requirements.5
The major reason for
this is that the irrigation efficiency of the irrigation system is
less than 50% i.e. about one half of the gross into the canal 153
system is not used productively by Crops; more than half of
these water losses (i.e. 25% of gross inflow) occur in
watercourse commands. (See Table 8). 154
TABLE 7
LAND CONVERSION AND EXPANSION
POTENTIAL
(Million acres)
Present Status
1978
Developed by
1960
Developed by
2000 or after.
Land requiring
drainage.
Outside command
21.8
6
12
2
9.8
4
Total:- 27.8 14 13.8
Source: Revised Action Programme.
Note:-* That is converted form present status to normal
irrigated land.
According to computer simulation studies done by
WAPDA, an additional 38 maf of water can be made available
at the farm gate on the basis of the following assumptions:-
i) The entire water potential is developed. 155
ii) The entire saline ground water watercourses are
50% lined. 156
TABLE 8
IRRIGATION EFFICIENCIES
During
Rabi Kharif
% %
I. DELIVERY EFFICIENCY
All 61 watercourses
Punjab and NWFP
Sind and Baluchistan
55
58
45
56
61
44
II. APPLICATION EFFICIENCY
All 61 watercourses
Punjab and NWFP
Sind and Baluchistan
70
73
64
68
69
65
Source: 21 Watercourse Survey, WAPDA cited in ‘Potential
for Irrigated Agricultural Development in Pakistan’
South Asia Projects. July, 1981.
iii) Usable ground water zones are enabled to extract
ground water on the assumption of full balanced
recharge. It is estimated that 50% of the water
potential could be developed by 1990 and the rest
of the 50% of the water potential could be 157
developed by 1960 and the rest of the 50% by the
year 2000. 158
SECTION IV
INVESTMENT REQUIREMENTS FOR REALI2ING
THE P(YFENTIAL OF AGRICULTURE
When we examine the composition of public
expenditure allocations to agriculture during the period 1970-
75, almost 50% went into Irrigation and the Indus Basin
Project. During the decade of the 1960’s, drainage and
reclamation investments In fresh groundwater were made on a
priority basis, while flood works, watercourse improvements
and rural Infrastructure and saline groundwater drainage were
relatively neglected. During the 1980’s there f a need to
recognize the physical Interdependence between increased
irrigation supply and drainage; and the conservation of present
water supplies through conveyance system improvements, as
well as canal expansion and remodeling, drainage works and
additional storage capacity.
Table 9 presents projections for the water sector and
development Plan up to the year 1984. The two principal
assumptions in these projections are
i) An annual Increase of 20% in the level of
resources allocated to the water sector; and
ii) Increases in the share of allocations to
irrigation, drainage and reclamation. The
relative allocation o Drainage and Reclamation
would increase to 50% of the total for irrigation
and water. A medium-term projection (up to
1990) of the structure of the agriculture and
water sector invest ment plan Is given as
Alternative ‘B’ in Table 10. The associated 159
annual growth of allocations to the water sector
average 13%.
TABLE 9
WATER SECFOR DEV PLAN
(1919.M)
Actual Allocation Projectiona
1978-79 1979.80 1980.81 1981-82 1982-83 1988-84
-----------------------------(Rs. Million) -----------------------------
Pakistan
Tarbela/Indus Basin 1,081 886 1,007 1,116 948 200
Irrigation 619 491 798 885 1,180 1,880
Drainage & Reclamn 660 745 786 1,140 1,581 2,701
Flood Control 310 216 231 289 328 394
Otherb
269 247 886 408 508 773
Total:— 2,779 2,585 3,158 8,183 4,540 5,448
Federal Only
Tarbela/Indus Basin 1,031 886 1,007 1,116 948 200
Irrigationc
418 358 615 595 875 1,000
Drainage & Reclamation 687 712 701 1,000 1,391 2,41
Flood Control 181 147 202 239 261 284
Other 93 75 80 80 105 226
Sub Total:— 2,310 2,178 2,605 3,030 3,580 4,120
Provincial Colony
Irrigation 101 133 178 240 305 380
Drainage & Reclamation 23 33 85 140 190 290
Flood Control 179 69 29 50 67 110
Other (incl. Water
Management 166 172 256 323 398 548
Sub Total:— 469 407 548 753 960 1,328
a. Water Resources Section of Federal Planning Division in consultation with
WAPDA (February 1981).
b. Includes water management, research, surveys and investigations.
c. Includes expenditure on the Chashma Right Bank Canal; other project dam
d. See Table 10 for details of projects.
Source: Potentials for Irrigated Agricultural Development In Pakistan op cit. 160 161
TABLE10
LABOUR ABSORPTION ASSOCIATED WITH
REALIZING LAND EXPANSION AND WATER
SUPPLY POTENTIAL IN PAKISTAN
Year
1972
(Present
Status)
1980 to 1990
(Developed)
1980 to 1990
(Developed)
Many Days required to sustain one farm
household (annual)
225.11 225.11 225.11
Labour requirement per acre of irrigated
land for farming. (Many days per year)
24.76* -- --
Area that can be potentially developed for
irrigated agriculture (million acres)
27.8 14.8 27.8
Total labour requirement for land
developed after 1980. (Many days per
year)
-- 366448000 688328000
Total Households on farm following land
development.
-- 1627934 688328000
Total population in farm households
absorbed by land development
-- 10582000 19877000**
Sources: i) Pakistan Census of Agriculture, 1972
ii) XAES Data WAPDA unpublished.
iii) Estimate mine.
* Note: This figure is estimated by combining WAPDA XAES data on labour requirement
per acre for each crop, and the Agriculture Census data on irrigated cropped
acreage for each crop. It is important to note that this figure assumes non-tractor
farm operation and yields per acre prevailing in 1972.
** Note: This estimated is based on a labour requirement figure per acre (See note above)
without tractors and at yield per acre for irrigated acreage prevailing in 1972. 162
SECTION V
CHANGES IN LABOUR ABSORPTION UP TO THE
YEAR 2002 UNDER DIFFERENT POLICY ASSUMPTIONS
In the earlier Sections I to IV we have discussed the
potential for increasing land productivity, land reclamation,
water supply and the implications for labour absorption and
investment. In this section we bring together the estimates and
analysis of the earlier sections, to give a picture of changes in
the labour absorption potential in crop production, under
various policy alternatives.
Table 11 shows our estimates of changes in labour
absorption in crop production under each of the four policy
options, during the period 1981 to 2002. The critical
determinants of changes in labour absorption are:
a) The pace of tractorization.
b) Realization of the potential for bringing 27.8
million acres under irrigated cultivation; and
c) Realizing some of the potential for increasing
crop yield per acre.
Our estimates of the labour displacement effect of
tractors are based on detailed crop-wise agriculture census
data combined with monthly labour requirements data for
%ach crop obtained from the WAPDA XAES. It is interesting
that our estimate of the per tractor labour displacement comes
to 3,842 man days per year, i.e., 10.53 full-time labourers.
This is remarkably close to the earlier World Bank Sample
Survey results reported in McInerney and Donaldson, “The 163
Consequences of Farm Tractors in Pakistan”. They estimate
the labour displacement effect per tractor to be 11 full-time
labourers.7
The four policy alternatives on the basis of which the
estimates of the table 11 are made are as follows:
Policy I: a) Growth rate of tractors and size of tractors in
the period 1975 to 2002, are the same as in the
period 1968 to 1975.
Policy II: a) Tractors adoption in the period 1975 to 2002
slows down to half the growth rate observed in
the period 1968 to 1975, while tractor size
remains unchanged.
b) The level of annual Investment In agriculture
remains unchanged.
Policy III: a) Tractor adoption in the period 1975 to 2002
slows down to half the growth rate observed in
the earlier period, while size remains
unchanged.
b) A 18% increase annually in the water sector
allocation, in order to bring 27.8 million acres
under irrigated cultivations.
Policy IV: a) Tractor adoption slows down in the period
1975 to 2002, to half the growth rate in the
earlier period.
b) A 13% annual increase in the water sector
allocation, bringing 27.8 million acres under
irrigated cultivation. 164
c) Realizing some of the potential for yield.
increases, leading to an increase of 25% in the
per acre labour requirement for Input
application, harvesting, and cultural practices.
Table 11 shows that if the existing trend in the growth of
tractors continues, and no other policy measure is adopted,
there will be a decline in labour absorption on crop production
of about 241 million man-days per year. This amounts to a
reduction in population absorption of approximately 7 million
people by the year 2002. At the other end of the spectrum of
policy options, under Policy IV, we estimate an increase in
labour absorption in crop production amounting to
approximately 710 million man-days / annum absorbing 20.5
million persons in the rural sector. 165
TABLE 11
PAKISTAN
ESTIMATED CHANGES IN LABOUR ABSORPTION LEVEL IN CROP PRODUCTION
DURING THE PERIOD 1981 TO 2002 UNDER VARIOUS POLICY ASSUMPTIONS.
Policy I Policy II Policy III Policy IV
Change in labour requirement,
(Man-days/year)
-240778140 -120392910 +567935090 +709918880
Change in total farm household -1069650 -534842 +2523035 +3153793
Change in total population in
farm household.
-6952725 -3746473 +16399727 +20499654
Source: i) Pakistan Census of Agriculture, 1972.
ii) Pakistan Census of Agricultural Machinery, 1975
iii) WAPDA XAES Labour Coefficients. Unpublished data.
iv) Report of the Farm Mechanization Committee, Ministry of Agriculture & Works,
Government of Pakistan, March, 1970.
Note (1): Estimates Ours.
Note(2) Policy I (a) Growth rate of tractors and size of tractors in the period 1975 to
2002, samea s in the period 1968 to 1975.
(b) Level of annual investment in agriculture unchanged.
Policy II (a) Tractor adoption in the period 1975 to 2002 slows down to half
the growth rate observed in the period 1968 to 1975, while
tractor size remains unchanged.
(b) Level of annual investment in agriculture unchanged.
Policy III (a) Tractor adoption in the period 1975 to 2002 slows down to half
the growth rate observed in the earlier period, while size
remains unchanged.
(b) A 13% increase annually in water sector investment up to 1990,
bringing 27.8 million acres under irrigated cultivation.
Policy I V (a) Tractor adoption slows down to half the earlier growth rate.
(b) A 13% annual increase in water sector allocation, bringing 27.8
million acres under irrigated cultivation.
(c) Realizing some of the potential for increased yield leading to a
25% increase in labour requirements per acre. 166
SECTION VI
1NCREASING LABOUR ABSORPTION IN THE
RURAL
SECTOR NON-FARM ACTIVITY IN THE
AGRICULTURAL SECTOR
(1) ABOUT THE CHOICE OF THE METHOD OF
CALCULATION
In the concept of employment used in the survey data
in Pakistan fails to take account of the central feature of rural
employment in the country, i.e. in the earlier Section view
discussed the implications of sets of policy packages for
labour absorption in farm production activity. In this section
we will present our estimates of labour absorption in non-farm
activity In the rural sector for the, same policy packages. This
will help complete the picture of the overall labour absorption
in the rural sector under different policy assumptions.
An accurate estimate of rural employment even at a
point in time, on the basis of labour force surveys is not
possible because of: a whole range of well-known limitations
in the methodology of such surveys. For example:
(a) The concept of employment used by the labour
force survey method of “those who are employed
or looking for employment” is relevant to the
advanced industrialized countries. The rates of
“unemployment” derived in this way are hardly
relevant in Pakistan where about 80% of the
labour force is constituted by self-employed and
unpaid family helpers.8167
(b) The concept of employment used in the survey
date in Pakistan fails to take account of the
central feature of rural employment in the
country, i.e. the seasonal and often informal
nature of the employment, and also the frequent
switching of jobs in the rural sector,
(c) Many family workers may be really dependents
who have taken up “escape jobs” in the rural
sector for lack of wage-paying jobs elsewhere
in the economy. This would also understate
unemployment.
(d) The use of “reference week” is liable to serious
bias which could operate in either direction:
Thus for example a person may be categorized
as employed in the survey, even though he may
be unemployed for the entire year except the
reference week. Conversely, a .person may be
unemployed during the reference week, but
employed in other periods of the year.
Apart from the above problems of Population
Census e of rural employment, an estimate of
off-farm employment based on an estimate of
the rural labour force would be subject to a
basic conceptual problem: An estimate of nonfarm
labour absorption based on a subtraction
of on- farm labour absorption from the rural
labour force figure of the ‘Population Census,
would give a residual figure. To regard this
figure as an estimate of non4arm rural
employment would be more hazardous than 168
heroic and could not even serve as a
‘guesstimate’.
Given the above problems in an estimate of nonfarm
rural employment based on Population Census
data, we decided to use instead the WAPDA XAES
estimate of the ratio of non-farm to farm
employment. We applied this ratio to our estimate
of on-farm labour absorption under each policy
package, to get estimates In terms of man-days
per year. These were divided (In each case) by
our estimate of man-days per year required to
sustain a family with the standard of living of
poor peasants in 1975, and wage rates prevailing
in the rural sector in that year. The resultant
figure gave a rough estimate of non-farm
households under each policy assumption. This
figure was multiplied by the 1972 Agriculture
Census figure of the number of family members
per-non-farm rural household, to get an estimate of
non-farm population absorption under different
policy assumptions. It Is Important to point out that
our estimates of non- farm population absorption are
in the nature of “guestimates”. Since they are
critically dependent on the WAPDA XAES ratio of
farm to non-farm employment, the estimates of nonfarm
population would be subject to the biases
inherent in a ratio, that assumes as temporally
constant the economic relationship prevailing
between the farm and non- farm sector, in 1977.
This estimate however may be better than the one
based on simply subtracting from the rural labour
force figure the estimate of labour absorption in
the farm sector: In contrast to the latter estimate 169
which is a mere residual, our estimate is at least
based on considering the economic relationship
between the farm and non- farm sectors of the
rural economy.
(2) POPULATION ABSORPTION ESTIMATES
FOR THE YEAR 2002 IN THE NON-FARM RURAL SECTOR
Table 12 shows that with policy package IV an increase In nonfarm
population absorption of 4.458 million persons can be
achieved by the year 2002, i.e., if the potential for increased
yields and land reclamation is achieved along with a slowing
down of the current rate of tractorization. With policy package
III, where the additional land is reclaimed and tractorization
slowed down without a significant yield / acre increase, the
population absorption in the non-farm sector is estimated at
3.565 million persons. Under policy packages II and I, given
the relationship between farm and non-farm activity, a decline
in farm population would result in a decline in the absorption
level of the non-farm sector. This of course assumes that
activity in the non-farm sector is the consequence of activity in
the farm sector. This of course would not hold if an autonomous
rural industrialization process begins during the period 1981 to
2002. We shall in the following sub-section indicate some of
the possible lines along which a dynamic growth process in the
non-farm rural sector could be generated.
ALTERNATIVE SOURCES OF EMPLOYMENT
GENE1 IN THE NON-FARM IWRAL SECTOR
We have argued in this paper that although at a technological
level, considerable potential e for increasing labour absorption
(through for example, land reclamation and improved irrigation) this
may to. some extent be under mined by the economic and social
processes operating in the farm sector. For example the tendency for 170
labour displace ment associated with rapid tractorization and the
changes in the size distribution of farm resulting not only in the
eviction of tenants, but also changes in cropping patterns, which
could adversely affect the labour absorption potential of the farm
sector. (See Chapters 8 and 9). Given these tendencies in the social
organization of agricultural production, if the pace of land
resumption by bigger landowners and the pace of tractorization Is
not slowed down; and a large increase in land reclamation and
irrigation availability is not achieved, there could be an absolute
decline in the ability of the farm sector to absorb population. It is
important therefore to consider measures for increasing the labour
absorption in the non-farm sector of the rural areas of Pakistan.
The notion that farmers will spontaneously engage in offfarm
activities if adequate price incentives for processed goods are
provided, ignores the financial and social constraints In which the
majority of farmers are operating For example, 88% of the farms,
are below 25 acres, most of them providing an income which is not
eve bare subsistence. According to the ILO,’° 74% of the rural
households have an income so low that they are unable to consume
even 2100 calories a day “per member. Moreover, most of the small
farmers are tied to the big farmers through a nexus of debt and
social dependence. This means that an overwhelming proportion of
farmers are not in the financial position to invest in rural industries.
The very small number of large farmers who are generating large
incomes show a high propensity to consume. -according to a recent
field survey for a doctoral thesis, large farmers (above 150 acres) in
the period 1960 to 1978 have a per farm expenditure on consumer
durables that is higher than their per farm expenditure on farm
implements (including tractors and tubewells) in the same period.11
(The per farm expenditure being Rs. 119,970,00 while that on farm
Implements was Rs. 111,656,00). 171
Even if large farmers were to undergo a psychological
transformation and develop the propensity to save rather than
consume, their investment in non-farm activities, as well ma
that of urban entrepreneurs cannot be expected without the
government provision of a whole range of marketing
transportation infrastructure and the establishment of
technical, financial and managerial facilities. Apart from this a
policy of careful selection of product and location would have
to be formulated to ensure that the rural industries actually set
up have forward and backward linkages in the rural sector so
as to maximize the secondary multiplier effects of investment.
Some examples of non-farm productive activity in the rural
sector which could be considered are12:
(1) Poultry, meat and egg production. For this
purpose small hatcheries for broiler and layer
chicks could be established. These would have
to be supported by a collection, inspection and
rapid transportation system, and a marketing
infrastructure.
(2) Milk collection and cooling centres could
provide additional cash income to farmers who
own live stock and also generate employment.
(3) Fruits and vegetables are currently marketed
with large differentials between farm and retail
prices. Cold storage facilities together with a
marketing infrastructure would generate
additional employ ment in the non-farm sector,
and also induce surplus farmers to invest in
these labour- intensive crops. 172
(4) Choice of appropriate technology in rice mills
can also generate off-farm employment. For
example the two tons per hour labour-intensive
mills could be set up intead of a smaller
number of the large 15 tons per hour capitalintensive
ones.
(5) Construction industry in the rural areas based
on indigenous material can play two important
roles. It can be a source of non-farm
employment and also serve to increase the
secondary multiplier effect of investment in
finished goods industries in the rural areas. 173
Table12
ESTIMATED CHANGES IN LABOUR ABSORPTION LEVEL IN NON-FARM
ACTIVITY WITH IN THE AGRICULTURAL SECTOR DURING THE PERIOD 1981
TO 2002, UNDER VARIOUS POLICY ASSUMPTIONS.
Policy 4 Policy 3 Policy 2 Policy 1
Change in labour requirement in
on-farm activity (million of man
days per year
709.919 567.935 -120.393 -240.778
Change in labour requirement in
on-farm activity (million of man
days per year
161.862 129.489 -27.450 -54.897
Change in total non-farm
households in agricultural sector
(millions)
0.719 0.575 -0.122 -0.244
Change in total non-farm
population in agricultural sector
(millions)
40458 3.565 -0.756 -1.513
Source:
i. WAPDA Master Planning and Review Division Revised Action Programme for
Irrigated Agriculture, Vol. 1. Draft Report, Pages 1-9.
ii. Pakistan Census of Agriculture All Pakistan Report, Page 24
Note:
i. Estimates: Mina
ii. For details of Policy Packages 1 to 4. See footnotes to table 11. 174
APPENDIX
TABLE 1(A)
PUNJAB
ANNUAL LABOUR ABSORPTION POTENTIAL WITHOUT TRACTORS
IN EXISTING IRRIGATION CROPPED ACREAGE UNDER EISTING
CROPPING PATTERN OF MAJOR CROPS.
(In Thousand of Man Days).
Size Class Wheat Rice Cotton Sugarcane Maize Oil-Seeds Pulses Fodders
Less than 7.5 L 23,207,4
H 30,136.2
8,844.4
11,140.7
14,976.7
18,882.5
6,053.6
7,188.0
3,655.7
4,467.8
535.7
643.1
349.8
508.8
13,305.6
15,614.6
7.5 to 12.5 L 33,237.1
H 43,160.4
12,847.1
16,182.5
23,089.8
39,111.5
9,377.5
11,134.8
4,040.9
4,938.5
1,137.0
1,364.9
734.5
1,068,3
19,000.7
22,298.0
125 to 25 L 48,911.1
H 63,514.1
15,816.9
19,923,4
38,012.0
47,925.2
14,056.4
16,960.4
5,234.4
6,388.7
2,187.9
2,626.5
1,752.9
2,549.6
28,572.6
33,531.1
25 to 50 L 30,301.1
H 39,347.8
9,932.7
12,511.5
24,973.1
31,485.9
7,890.3
9,369.0
2,704.2
3,304.9
1,586.4
1,904.5
1,275.6
1,855.4
16,740.1
19,645.2
50 to 150 L 17,026.3
H 22,109.7
5,970.7
7,520.8
15,100.2
19,038.2
3,422.8
4,064.2
1,296.4
1,581.6
888.3
1,066.4
631.8
919.0
7,675.6
9,007.6
150 & above L 5,487.1
H 7,125.3
1,679.2
2,115.2
6,439.0
8,118.3
713.4
847.0
307.5
375.8
243.6
292.5
159.2
231.6
1,652.6
1,939.4
Total each crop L 158,170.1
H 205,393.5
55,091.0
69,394.1
122,590.8
154,561.6
41,514.2
49,293.4
17,239.1
21,057.3
6,578.9
7,987.9
4,903.8
7,132.7
86,947.2
102,035.9
Total for major crops L 493,035.0 776,310.0
(Thousands of Man Days) H 616,756.6 971,132.0
Source:
Pakistan Census of Agriculture, 1972
WAPDA XAES Labour Coefficients in the WAPDA data
Note:
The Labour Coefficient for fodder is taken as the average of Kharif and Rabi fodder
coefficients in the WAPDA data
L refers to labour absorption estimates based on current yields175
APPENDIX
TABLE 1(B)
PUNJAB
ANNUAL LABOUR ABSORPTION POTENTIAL WITHOUT TRACTORS
IN EXISTING UNIRRIGATION CROPPED ACREAGE UNDER EISTING
CROPPING PATTERN AND EXISTING CONDITIONS PRODUCTIONS.
(In Thousand of Man Days).
Size Class(Acres) Wheat Cotton Sugarcane Maize Oil-Seeds Pulses Fodders
Less than7.5 6,767.84 179.25 91.41 1,640.98 455.21 875.25 1,579.41
7.5 to 12.5 8,097.28 253.23 145.66 667.20 618.43 1,634.25 2,265.10
12.5 to 25 11,018.86 410.14 196.01 510.08 945.09 3,427.06 3,663.56
25 to 50 6,924.24 268.59 161.30 259.32 620.80 5,190.50 3,070.85
50 to 150 3,956.35 234.25 118.78 109.78 277.28 5,881030 2,499.01
150 and above 793.51 77.06 26.40 29.49 50.57 1,444.52 588.23
Total each crop 37,558.08 1,422.52 739.56 3,216.92 2,967.38 18,453.42 13,666.16
Source:
Pakistan Census of Agriculture, 1972.
XAES data for labour coefficients (unpublished data)
APPENDIX 176
TABLE 1 (C)
PUNJAB
ANNUAL LABOUR REQUIREMENT FOR IRRIGATED CROPPED
ACREAGE WITH TRACTORS (1975 USE LEVEL)
(BY MAJOR CROPS)
Man-Days Requirement for
Tractorized Acreage.
Man-Days Requirement for
non- Tractorized Acreage.
Total man
days
Requirement
Crop Cropped
acreage
(irrigated)
Cropped
Acreage
covered
by
Tractors
(irrigated)
Per Acre
Requirement
Total
Requirement
Per Acre
Requirement
Total
Requirement
1 2 3 4 5 6 7
Wheat
Rice
Cotton
Sugarcane
Maize
Oil-Seeds
Pulses
Fodders
9482599
1829041
4337962
839181
756758
547335
550363
4979791
1631067
314588
746136
144308
130204
94084
94600
856560
12.5
23.8
23.9
42.9
18.5
7.9
4.4
13.3
20388450
7487194
17832650
6190813
2408774
743264
416240
11392248
16.5
29.8
27.9
48.9
22.5
11.9
8.8
17.3
129558000
45117200
100216800
33985500
14107500
5390700
4012800
7127600
149946450
52604394
118049450
40176313
16516274
6133964
4429040
18519848
406375733
Source: i) Pakistan Census of Agriculture, 1972.
ii) Pakistan Census of Agricultural Machinery
iii) XAES data 177
APPENDIX
TABLE 1 (D)
PUNJAB
ANNUAL LABOUR REQUIREMENT FOR UNIRRIGATED CROPPED
ACREAGE WITH TRACTORS (1975 USE LEVEL)
Man-Days Requirement for
Tractorized Acreage.
Man-Days Requirement for
non- Tractorized Acreage.
Total man
days
Requirement
Crop
Cropped
acreage
(irrigated)
Cropped
Acreage
covered
by
Tractors
(irrigated)
Per Acre
Requirement
Total
Requirement
Per Acre
Requirement
Total
Requirement
Wheat
Cotton
Sugarcane
Maize
Oil-Seeds
Pulses
Fodders
2279005
50957
15134
142897
249981
2096988
792242
173204
3872
1150
10860
18999
159371
60210
7.5
12.4
28.1
11.7
5.3
5.8
7.2
1229030
48012
32315
127062
100695
924351
433512
11.5
19.4
34.1
15.7
8.3
7.8
9.6
24216711
913449
476854
2072981
191715
15113412
7027507
25515741
961461
509169
2200043
292410
18037763
7461019
52977606
Source: i) Pakistan Census of Agriculture, 1972.
ii) XAES data 178
NOTES
1. See: A. Hussain: Impact of Agricultural Growth on Changes in
the Agrarian Structure of Pakistan. D. Phil. thesis 1980.
University of Sussex, page 369, Table 6.
2. S.M. Naseem: Rural Poverty and Landlessness in Pakistan in
Poverty and Landlessness in Rural Asia, ILO Geneva, 1977.
For 1979 figure See:
IFAD: Agricultural Policy and Rural Poverty in Pakistan. Report
of the Special Programming Mission to Pakistan. Jan, 1984.
3. The estimates of the technical potential for increased agricultural
productivity are drawn from the Expanded Agricultural Economic
Survey (WAPDA) and their report entitled ‘Revised Action
Programme for Irrigated.
4. Delivery Efficiency: is defined as the ‘ratio of flow at the point of
delivery to the flow at the head of the watercourse.
Application Efficiency; is defined as the ratio of water stored in
the crop root zone to water applied in the field.
5. Potential for Irrigated Agricultural Development in Pakistan.
Agricultural Division ‘A’. South Asia Projects. July, 1981, page
23. (Computer Simulation Studies, WAPDA),
6. These figures are obtained from:
Potential for Irrigated Agricultural Development in Pakistan. op.
cit. Tables L and M.
7. John P. Mc and Graham F. Donaldson:
The Consequences of Farm Tractors in Pakistan.: World 8ank
Staff Working Paper Number 210 Feb. 1975, page 52.
8. International Labour Organization. Employment Strategy — Pak/
75/051. Project Findings and Recommendations. Geneva 1977,
page 1.
9. M. Ghaffar Chaudhry: Rural Employment in Pakistan: Magnitude
and some Relevant Strategies. Pakistan Institute of Development 179
Economics, Islamabad October, 1981, page 17.
10. See Naseem op. cit.
11. A. Hussairi: The Impact of Agricultural Growth on Changes in the
Agrarian Structure of Pakistan. D.PhiL Thesis, Sussex University,
1980, pages 339 & 340.
12. 12, See: Jerry Eckert et a). An Employment Strategy for Rural
Areas. Islamabad :May, 1973.
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