Economic Aspects of Basmati Rice in Pakistan
Received Date: Feb 21, 2018 / Accepted Date: Apr 06, 2018 / Published Date: Apr 09, 2018
Agriculture, industry and commerce are the main sector on which economy of the country relies. The major cash crops of Pakistan are cotton, wheat, rice and maize. Rice is the second most important crop which makes economic prosperity of the growers/farmers as well as earns billions of rupees through its export for country. Rice played a key role in the agro-based and occupied a prominent position in agricultural economy of the country. Pakistan is the 11th largest producer and 4th largest exporter of rice. Rice accounted for 3.2% of the value added in agriculture and 0.7% of GDP in Pakistan. Two types of rice were under cultivation in Pakistan. Basmati rice was famous in the country due to its excellent cooking quality and good marketing value at national and international levels. Rice was cultivated on an area of 2.847 million hectares during the period 2014-15 showing an increase of 3.1% over last year. Production of rice during the same period was estimated at 6.9 million tons, which was 1.5% higher than last year’s production 6.7 million tons. During the same period, rice export earned foreign exchange of USD 1.848 billion. The importance of Basmati rice as well as export impacts were observed in the review.
Keywords: Rice; Basmati; Economics; Export; Pakistan
Economy of every country depends on three sectors i.e. agriculture, industry and commerce. These three are strongly related with each other as the progress or revert of one sector effects the other two. Pakistan is an agricultural country thus agriculture outputs have much importance than any other sector. Importance of agriculture sector is manifold as it provides feeds, raw material for industry and is a base for foreign trade.
Rice is the second most important crop which makes economic prosperity of the growers/farmers as well as earns billions of rupees through its export for country. Rice plays a key role in the agro-based and occupies a prominent position in agricultural economy of the country. Pakistan is the 11th largest producer and 4th largest exporter of rice. Rice accounts for 3.2% of the value added in agriculture and 0.7% of GDP in Pakistan .
History of Basmati Rice
The name Basmati has been derived from the combination of two Hindi words: BAS which translates into fragrant and MATI meaning “Queen” so, collected meaning “Queen of Fragrance”. It is said that Basmati Rice was only instigate and identified in Asia for many years. This type of rice has been grown in the foothills of the Himalayas for numerous of years. Some sources indicate that the primogenital grain samples found from Mohanjodaro in Pakistan. The elite producers of Basmati Rice in Asia are India, Pakistan and Bangladesh. This extremely fragrant rice is Pakistani’s gift to the entire world. Basmati rice is full from balance nutrients and high energy caloric food. About 72-75% carbohydrate present in the form of rice starch and 7% in the form of aryznine or glutelin. It also contains about 80% protein and certain minerals like phosphorus and enzymes .
Yearwise Comparison of Rice in Pakistan
The area, production and yield of rice in Pakistan are given below (Table 1):
|Year||Area (ha*)||Production (tons**)||Yield (kg/ha)|
Table 1: Area, Production and average yield of Rice for Pakistan ; *Area in thousand hectares; **Production in thousand tons.
Rice was cultivated on an area of 2.847 million hectares during the period 2014-15 showing an increase of 20% over last year. Production of rice during the same period was estimated at 6.9 million tons, which is 1.5% higher than last year’s production 6.7 million tons. During 2000-2001, the area, production and yield of rice increased by 20%, 44% and 20% respectively as compared to 2014-15.
Export Status of Rice from Pakistan
Pakistani fine rice well-known as Basmati is very famous in all around the world. It enjoys monopoly in the international market, due to its quality characteristics, strong aroma, taste and texture and grain elongation on cooking and the world is ready to pay a premium for this. It supports the case for the crop to be protected as Geographical Indication (GI) and exports to be enhanced. Basically basmati has traditionally been an export crop in Pakistan [4,5]. In recent periods, 60% of the total annual production of 2 million tons produce has been traded abroad and generating about 2 billion USD for the national economy. The change in basmati export from last fifteen years can be analyzed from the Table 2.
|Quantity (MT)||Value (million USD)||Quantity (MT)||Value (million USD)||Quantity (MT)||Value (million USD)|
Table 2: Export of rice from Pakistan year wise .
The export of Basmati from Pakistan has declined by 40% in the past four years, from 1.1million tons in 2011 to 676,630 tons in 2015. As a consequence, the domestic market has been overcome by an uncontrollable excess, with an accumulated surplus of 1 million tons. This has decreased the domestic price of rice by 50%, from Rs 4500/ maund in 2012 to Rs 2200/maund in 2015. A continuous decline in the export of basmati rice is having a harmful effect on the country’s economy. It has increased country poverty with frequently terrible consequences for small farmers. Continuously down position of rice in the international market results in a low price for exports, while the domestic price of rice is high because of the high cost of production.
Major Pakistani Basmati Rice Importing Countries
The major Pakistani Basmati rice importing countries are given in the Table 3. The main basmati rice Importing countries from Pakistan in the years 2013-14 and 2014-15 are Canada, Germany, U.K, Yemen, Oman, UAE, Saudi Arabia, Iran, Iraq, Belgium, USA and KSA. The statistics from the above Table 3 showed that the exports of Pakistani Basmati rice have increased in Canada, Germany, Oman, Kenya, etc. in the year 2014-15. On the other hand, exports of our Basmati rice have declined in U.A.E, Yemen, Iraq, Belgium, KSA, etc. in the same period.
|Country||Basmati export Quantity (MT)||Country||Basmati export Quantity (MT)|
Table 3: Main importing countries of Pakistani Basmati rice Source .
Major Basmati Sowing Area in Punjab
Pakistan is famous for growing and exporting long grain Basmati rice. It is completely grown in certain parts of the Punjab . The main growing areas of Basmati are Districts Gujranwala, Hafizabad, Sheikhupura, Sialkot, Narowal, Hafizabad, Nankana Sahib, Chiniot, Gujrat, Mandi Bahaudin and Kasur. It was cultivated on an area of 3.26 million acres during the period 2014-15 showing an increase of 10.7% over last year. Production of Basmati rice during the same period was estimated at 2.34 million tons, which is 13.6% higher than last year’s production 2.06 million tons. The area, production and yield of Basmati rice for the last fifteen years are given in Table 4.
Table 4: Area, Production and Yield of Basmati Rice in Punjab . *Area in thousand hectares; **Production in thousand tons.
Punjab is the leading rice growing province with about 61% of rice area and about 46% of total rice production of the country. In Punjab, approximately 78% of the total rice area is under Basmati varieties. During 2000-2001, the area, production and yield of rice increased by 16.5%, 44%, 23.4% respectively as compared to 2014-15.
Percentage Area under Different Rice Varieties in the Punjab from 2010-11 to 2014-15
The data in the Table 5 was provided by Directorate of Crop Reporting Services, Lahore regarding the percentage area under different rice varieties cultivated under rice crop in Punjab.
|Area||% Change||Area||% Change||Area||% Change||Area||% Change||Area||% Change|
Table 5: Percentage area under different rice verities in Punjab from 2010-11 to 2014-15 .
During the crop year 2010-11, the variety Super Basmati is one largest that covered 67% of area cultivated under rice crop in Punjab. While in the crop year 2014-15, the most famous rice variety Super Basmati was seen covering 51% area cultivated under rice crop in the Punjab Province.
Comparison of International Rice Prices
The international prices of Pakistani basmati rice in different periods can be seen in the Table 6.
|Price (US D/ton||471.89||515.63||677.19||1079||937.29||879.15||1060.3||1099.4||1372.2||1323.9|
Table 6: International price of Pakistani Basmati rice from 2005 to 2014 .
The trend of international price of Pakistani basmati rice is increasing gradually due to higher demand for basmati from Iran, Saudi Arabia and West Asia is helping farmers in Pakistan get good price for their produce .
Reasons for Decrease in Export of Rice
Pakistani rice especially Basmati is very popular in all around the world but mixing of inferior varieties affects the quality of rice which results in loss of market and reputation. The use of poor technology for harvesting, threshing and milling results in huge quantity of broken rice and deteriorate quality. Mostly exporting companies of Pakistan are not labeling their products and selling rice without any brand name. As a result, the exporters/traders do not get good price of even high quality product. Due to availability of stocks in the importing countries, demand of rice has decreased considerably. Pakistan is selling rice in bulk quantity. Pakistani exporters are not selling rice in packing of 1 Kg, 2 Kg & 5 Kg which results in lower price. Cultivation of unapproved verities by the farmers should be discouraged because it results poor quality of the produce. Electricity shortages have also increased the cost of production because some rice mills are operating at only half their capacity, and gas shortages make the drying process longer. Power tariffs are on higher side which makes the tube-well irrigation expensive. The storage capacities for exports are in sufficient. Prices of fertilizers and pesticides are on higher side. Proper machinery is not being used by the farmers in harvesting and threshing, which results in damage to the quality of rice. Old traditional system to dry the paddy rice on open space is still in practice.
It was concluded from all above discussion and statistics of rice, the basmati trade has played a major role in the improvement of rural poverty as more of the area of Pakistan especially in Punjab province occupied by basmati. Unfortunately, national and international markets of our Basmati and other rice are badly affected due to country crises like high Power tariffs, shortage of gas and electricity, water shortage and high cost of production. Our farmers cannot get the good prices of their rice in the national and international market in the presence of these crises. The market crashes are also discouraged the farmers from growing basmati and this will decrease the area under rice cultivation with awful consequences for country incomes and the economy as a whole. Consequently, our rice export is facing a declining trend continuously and we are pushing back in the race of rice market. The seed production and distribution are important amongst the factors which determine the pace of agricultural development of a country/region. The production and distribution of seed is a complex process involving farmers, growers, Government agencies, research institutions and other stake holders. Use of quality seed only can enhance the productivity by 15-20%. Quality seed plays a pivotal role in boosting agricultural production both in market oriented and subsistence farming system. Seed has the unique position among various agricultural inputs because the effectiveness of all other inputs mainly depends on the potential of the seeds. Seed is a high technology product and is an innovation most readily adapted. Improving access to good quality of seed is critical requirement for sustainable agricultural growth and food security. Effective use of improved/certified seed can result in higher agricultural production and increases the net income.
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Citation: Shahzadi N, Akhter M, Ali M, Misbah R (20018) Economic Aspects of Basmati Rice in Pakistan. J Rice Res 6: 192. Doi: 10.4172/2375-4338.1000192
Copyright: © 2018 Shahzadi N, et al. This is an open-access article distributed under the terms of the Creative Commons Attribution License, which permits unrestricted use, distribution, and reproduction in any medium, provided the original author and source are credited.
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