ISLAMABAD: Pakistan’s agricultural sector is teetering on the edge of collapse, with wheat and cotton farmers alone absorbing a staggering Rs 4.2 trillion in losses over the past year, a crisis agricultural leaders warn could spiral into a national food emergency if urgent reforms are not undertaken.
At the center of the turmoil is the wheat sector, where growers have suffered losses of over Rs 2.2 trillion since May 2024. According to estimates, this loss alone erodes 23% of the total crop sector’s contribution to Pakistan’s GDP, which stood at Rs 9,500 billion for FY2023–24.
The root causes are a toxic mix of plummeting prices, poor yields, lopsided taxation, and absent policy support. Despite a government-set support price of Rs 3,900 per 40 kg, farmers are now being forced to sell wheat at Rs 2,200, well below their production cost. Simultaneously, national wheat output fell by nearly 9% — from 31.81 million tons to just 28.98 million tons in 2025 — tightening the economic noose on the rural economy.
Cotton Collapse and the Import Paradox:
The cotton sector, once a backbone of Pakistan’s textile-driven economy, has seen an even more dramatic crash. Production has plunged 34% from last year to just 5.55 million bales — nearly half the national target. Farmers now lose Rs 1,000 on every 40 kg, while the cotton import bill has soared from $448 million to an estimated $1.9 billion, driven by cheaper, tax-exempt imports from the U.S. and Brazil.
“This is economic apartheid,” declared Pakistan Kissan Ittehad (PKI) President Khalid Mahmood Khokhar at a press conference in Islamabad. “Our own farmers are taxed 18% on seed cotton, while imported cotton enters duty-free. The result is a slow but systematic destruction of domestic agriculture.”
The pattern continues across other major crops. Maize production has shrunk by 15.4%, sugarcane output has dipped by 3.8%, and the total production of major crops has contracted by 13.5% in FY2024–25. Agriculture sector growth has plummeted from 6.25% to just 0.56% a drop that Khokhar calls “nothing short of catastrophic.”
Meanwhile, Pakistan’s food trade deficit continues to widen. Between July 2024 and April 2025, food exports fell slightly to $6.16 billion, but food imports ballooned to nearly $7 billion, undercutting claims of food self-sufficiency.
Farmers and economists alike point to policy paralysis, unjust taxation, and international lending constraints as primary culprits. While imported cotton is exempt from GST, domestic seed cotton faces an 18% tax, a stark example of what farmers describe as “economic injustice.” Additionally, agricultural inputs like tractors and implements are taxed at 14–18%, pushing costs out of reach for many small growers.
Khokhar warned that further IMF-advised taxation on agriculture could be the final nail in the sector’s coffin. “The farmer is being taxed into extinction. We need urgent relief, not more red tape.”
The PKI has demanded the immediate removal of all GST and FED on agricultural inputs, and the implementation of fair commodity pricing that guarantees at least a 25% return on investment for farmers. They also called for a flat electricity tariff of Rs 10 per unit and parity in support mechanisms across regions, citing India’s provision of 10 hours of free electricity to its farmers daily.
Highlighting the worsening groundwater crisis, Khokhar revealed that water tables in some regions have dropped from 24 to over 70 feet an alarming development in a country already ranked among the most water-stressed in the world.
In a rare appeal beyond civilian leadership, Khokhar urged Chief of Army Staff General Asim Munir to intervene, citing the Army’s historic role in agricultural initiatives and national security.
Wheat Scandal: Inquiry Report Kept Under Wraps:
Adding to the controversy, Khokhar claimed that findings of the wheat import scandal have been deliberately kept secret. “Three junior officials have been suspended to mislead the public, while those truly responsible remain untouched,” he alleged.
Sources privy to the Establishment Division confirmed that the inquiry report implicates several high-ranking officials. It recommends dismissal for Imtiaz Ali Gopang (former Food Commissioner), censure for Sohail Shahzad (Director Technical DPP), and a three-year promotion freeze for Capt. (Retd.) Muhammad Asif (former Secretary, MoNFS&R). The report names Capt. (Retd.) Muhammad Mehmood as the key figure in the excessive wheat import debacle, accused of authorizing unrestricted imports.
As the crisis unfolds, the government’s announced relief packages are being dismissed by farmers as hollow. With sowing season approaching, many growers face an impossible choice: plant without inputs, or abandon farming altogether.
Unless immediate, structural reforms are enacted not just promises Pakistan risks pushing its agriculture sector past the point of no return, with consequences that could ripple through its economy, food security, and social stability for years to come.
