Contents

Agrarian Economies
of the Two Punjabs

Iqbal Mustafa and Farrukh M. Khan

Before the Partition of the subcontinent, the province of Punjab was the breadbasket of the Indian subcontinent. After the Partition, the divided parts of Punjab Pakistani and Indian are still performing the same functions with many differences and some similarities. The major difference is in production efficiencies where Indian Punjab leads. For example, it produces about the same amount of wheat from half the acreage of Punjab in Pakistan. In rice, the differences are even more dramatic: Indian Punjab produces five times more with three times the yield per hectare.

Although direct comparison between the two Punjabs is not truly valid, given the difference in size geographical area of Indian Punjab is only 25 per cent of Pakistani Punjab and it has more uniformity of climate, better water resources and less uncultivable wastelands the higher production efficiency is because of many factors attributable to human effort from which Pakistani Punjab can learn many lessons.

Provincial Profiles
An outline of the land and water resources of two Punjabs is given in Table-1.

Table 1

No. Parameters Indian Punjab Pakistani Punjab
1. Geographical area (million hectare) 5.036 20.630
2. Cultivated area (million hectare) 4.224 15.960
3. Cropping intensity (%) 185 145
4. Total No. of farms (million) 1.093 3.864
5. Land holding (%)    
  Upto 2 hectare 36 56
  From 2 to 5 hectare 29 29
  From 5 to 10 hectare 28 10
  10 & above 7 5
6. Average size of holding (hectare) 3.61 2.91
7. Irrigated area million hectare (%)    
  Canal 1.148 (28.45%) 3.700 (56.40%)
  Tubewell 2.880 (71.38%) 2.740 (41.77%)
  Others 0.007 (0.17%) 0.160 (2.44%)
  Total 4.035 (100 %) 6.560 (100%)
Source: Department of Agriculture Punjab (2002-03) and Agriculture Census, Federal Bureau of Statistics, Pakistan (2003-04)

Both provinces lie in the temperate zone within the monsoon belt. Annual rainfall in Pakistani Punjab varies from 150 mm in the south arid regions, 620 mm in central semi-arid Punjab to 1150 mm in northern sub-mountainous regions. In Indian Punjab the annual rainfall is similar to central and northern Punjab in Pakistan varying between 500 mm to 1000 mm. The seasonal distribution of rainfall is strongly influenced by monsoons, which start in June and cause 70 per cent of the rainfall till September. Winter rains occur during December to March and are more wide-spread. The quantity and distribution of rainfall is normally insufficient for crop requirements in most areas.

In both provinces there are four distinct climatic seasons:

  • Winters -- moderate widespread rainfall – from December to March
  • Summers -- extremely hot and dry – from April to June
  • Summers -- hot and humid, scattered rainfall – from July to September.
  • Autumn -- cool and dry – from October and November.

Crops are classified by season: Summer crops, grown from April to November, are called Kharif crops while winter crops, grown from October to April, are known as Rabi crops.

It may be noted from Table 1 that in Indian Punjab, 95 per cent of cultivated area is irrigated while in Pakistani Punjab only 41 per cent of cropped area is irrigated. There are large tracts of agricultural lands that are rain fed in Pakistan, called barani areas. This factor depresses overall yield per hectare in Punjab for wheat. In addition to this difference, 71 per cent of irrigation in Indian Punjab is from tube-wells and canal irrigation is 28 per cent. In Pakistani Punjab, 41 per cent areas are tube-well irrigated and canal irrigated areas are 56 per cent. However, in Pakistani Punjab the total quantum of irrigation water from tube-wells is higher as canal irrigation is mostly augmented by underground water. There are two reasons for higher use of ground water in Indian Punjab. First is the relative quality of groundwater that is better in India; many areas in Pakistan have subsoil water that is unfit for agriculture having either high salinity or high sodicity, or both. Secondly, the Indian government has provided huge subsidies on electricity for tube-wells. Until recently, electricity was provided free for tube-wells but now a flat rate of Rs. 60 per Horsepower per month is levied, which is nominal compared to the high electricity tariffs in Pakistan.

Land Distribution
A major difference in agricultural economies of two Punjabs is the land distribution patterns. The Indian Land Reforms brought about in 1960 by the Nehru government limited a family holding up to 16 standard acres (6.5 hectares). A standard acre is defined as one that is irrigated, has good subsoil water and is not affected by excessive salts. For lands that have some defects or are poor in fertility (excessively sandy) the holding limit is enhanced up to 35 acres (14 hectares). In the land holding figures for India, therefore, the category of 10 hectares and above corresponds to 14 hectares maximum.

The three land reforms in Pakistan (1979, 1972 and 1977) reduced individual holdings to 8,000 Produce Index Units (PIUs), or 100 acres irrigated and 200 acres unirrigated land. This has allowed some farmers to own large tracts of land under family holdings. Therefore, in the figures of land distribution for Pakistan 10 hectares and more may correspond to much larger holdings.
Following the 1960 Land Reforms, the land ownership patterns changed in Indian Punjab. 'Since the introduction of the green revolution technology, the agrarian structure of Punjab has witnessed interesting changes. The number of marginal and small holdings declined sharply, while those in the higher-size categories showed a modest increase. These changes occurred primarily due to three reasons. First, with the onset of the green revolution technology, crop production activities became economically attractive, which created an active land-market for leasing and selling land. Secondly, progress of agriculture under the green revolution technology created additional employment opportunities in the non-farm sector. These encouraged many marginal farmers either to sell their land or lease it, to earn higher incomes from non-farming jobs. Finally, the new technology turned out to be more attractive to the large farmers, mainly because the mechanical inputs associated with it were indivisible, and thus uneconomic for use in smaller-size farms.'

During the 1980s, as farm profitability decreased and non-farm job opportunities became limited, the number of farms increased. The average holding has decreased from 4.07 hectares (in 1980-81) to 3.61 hectares. However, the trend has been arrested now in spite of land division by laws of inheritance. The current distribution of land holdings is given in Table 2.

Table 2: Size of Farms in Indian Punjab

Size
Hectares
Number
farms

percent
Area 1000
Hectares

Percent
Below 1 204 19% 122 3%
1-2 183 17% 240 6%
2-4 320 29% 833 20%
4-10 306 28% 1754 42%
10-14 80 7% 1198 29%
Total 1093 100% 4147 100%
Source: Department of Agriculture, Punjab (India) 2003-04

In Pakistan, the range of land holdings is far wider. With higher limits on land holdings on one end, and increase in subsistence farms on the other due to Islamic laws of inheritance in the absence of land markets, land holdings have been fragmented at a faster pace than in India. The lower limit on land holdings and fast-track adoption of production-augmentation technologies in India has created uniformity in size of land holdings. The distribution of land holdings in Punjab, Pakistan is given in Table 3.

Table 3: Size of Farms in Pakistani Punjab.


Size Hectares
Number
Farms
Percent of
Farms
Area
Hectares
Percent
of Area
Under 0.5 703638 18% 201112 2%
0.5 to under 1 617265 16% 459408 4%
1 to under 2 844219 22% 1166753 10%
2 to under 3 597863 15% 1403901 12%
3 to under 5 536361 14% 2081497 19%
5 to 10 368362 10% 2422326 22%
10 to 20 149018 4% 1858563 17%
20 to under 40 36696 1% 909254 8%
40 to under 60 5712 0% 263095 2%
60 and above 4932 0% 469257 4%
Total 3864070 100% 11235161 100%
Source: Federal Bureau of Statistics, Pakistan. Agriculture Census 2000

If farm sizes are arbitrarily divided into small (less than 2 hectare), medium (up to 20 hectare) and large (above 20 hectare) the distribution of lands shown in Table 4 indicates that in Pakistan the distribution curve is much wider.

Table 4: Comparative Distribution Curve of Land Holdings.

Farm Size India Pakistan
Small 9% 16%
Medium 91% 69%
Large Nil 15%
Computed from Table 2 & 3

India has focused its institutional support in terms of infrastructures, technology, credit, research and extension and market mechanisms for the medium sized farms in a very aggressive way. In Pakistan the proportion of small, uneconomic farms and larger farms is much higher. Larger land holdings have a profound influence on political economies of rural areas where large farmers are able to appropriate disproportionate amount of resources credit, subsidies, extension services etc.

Infrastructure
Rural infrastructure plays a critical role in the development of agriculture. Roads, electricity and communications are key components of infrastructure, apart from social sectors like health, education and sanitation etc. Indian Punjab has higher density of roads, electricity and communications network than its Pakistani counter part. Compared to Pakistan's Punjab, the Indian Punjab has twice as much density of rural roads 0.47 kilometres of roads per square kilometre of area. Pakistan has only 0.19 kilometres per square kilometre. In Indian Punjab 81 per cent of tube-wells are powered by electricity as compared to only 10 per cent in Pakistan's Punjab. This may have to do with higher electricity tariffs but more so with distribution, efficiency and reliability of rural electricity networks. Indian Punjab is ahead on other benchmarks of infrastructure development.

In comparison, effective land reforms are considered a key factor for development of agriculture in Indian Punjab by many experts. It is true that uniformity of farm size has helped in creating commercial orientation of agriculture, especially with institutional support provided by the government. It has been easier for research and extension services to focus on technology packages for medium sized farm operations. However, while land reforms laid the foundations for progress in a planned economy, many other government initiatives and policies contributed towards fast growth. The aggregate impact of the government's support to agriculture in Indian Punjab has, therefore, been very effective because of the planned synergy between many factors, which reflects in its higher productivity.

Land Utilisation, Production and Yields
Table 5 provides a profile of land utilisation in the two Punjabs as a comparison.

Table 5: Classification of Area (000 ha.)

  Indian Pakistani
  Punjab Punjab
Geographical Area 5036 20630
Forests 277 520
Land not available for Cultivation 454 3010
Un-culturable wasteland 16 1800
Fallow 62 1560
Net Area Sown 4224 10750
Area sown more than once 3602 5300
Total Cropped Area 7826 16050
Area under cultivation % 85 52
Cropping Intensity % 185 145
Source: Department of Agriculture Punjab
(India) and FBS, Census 2000, Pakistan

It may be noted that Indian Punjab has one-fourth the geographical area of Pakistani Punjab but its total cropped area is about one-half. This is due to higher utilisation of lands for agriculture (85 per cent as against 52 per cent) and higher intensity of cropping (185 per cent against 145 per cent). Combined with higher per hectare yields, this translates into much higher production efficiencies.

Since both provinces share similar climate, soils and water resources, the cropping patterns are quite similar out of historical inertia; however, the share of land allocated to various commodities varies out of economic choices. Table 6 shows the allocation of cropped area to various crops.

Table 6: Percent of land allocated to crops

  Indian Pakistani
  Punjab Punjab
Wheat 41.1% 41.0%
Paddy 31.6% 11.0%
Maize 1.9% 1.0%
Pulses 1.3% 7.0%
Total oilseeds 1.9% 2.0%
Sugarcane 1.3% 3.0%
Cotton 6.9% 15.0%
Vegetables including onions 1.7% 4.0%
Fruits 0.8% 1.0%
Fodders 7.4% 13.0%
Forests 3.4% 2.0%
Source: Future of Agriculture in Punjab (India), CCRID, 2002, and FBS, census 2000, Pakistan

There are similarities in cropping patterns to a large extent, except that Indian Punjab allocates larger acreages to rice while in Pakistani Punjab cotton and fodders occupy larger shares in land allocations. The higher yields and better quality justify greater emphasis on cotton, which feeds Pakistan's large and competitive textile industry. The higher yields and guaranteed support price make rice an attractive option for Indian farmers. Livestock accounts for a larger share (over 50 per cent) of agricultural GDP in Pakistani Punjab; therefore more land is allocated for fodders. However, low yields of fodder crops and low milk production of animals also contribute to disproportionately large allocations of land to fodder crops.

The key difference between the two provinces lies in yields. In wheat and rice yields differences are dramatic while in other crops Indian Punjab has significantly higher yields. Cotton is the only exception to this. Table 7 provides production and yield data for main crops in the two Punjabs.

Table 7: Production & Yield of Main Crops (2002-2003)

  Indian Punjab Pakistani Punjab
  Production Yield Production Yield
Wheat 14415 4190 15355 2518
Rice 14411 5513 2579 1706
Maize 459 2882 882 2105
Pulses 47 855 804 700
Cotton 1478* 7664 7664* 590
Sugarcane   59520   45100
Sunflower 32 1590 55 1471
Oilseeds 63 1075 146 969
Production: 000 Tons
Yield