Agricultural Price Policy for Growth (The Distinguishedl Lecture)

Superb agricultural resources, substantial investment, and relatively liberal macroeconomic policies have provided Pakistan with a high agricultural growth rate and strong multipliers of that agricultural growth to other sectors of the economy. Those growth rates and the consequent multipliers could have been much greater. More troubling, there are unsustainable elements to the past growth rates that are already showing themselves. Thus, without attention to key policy issues, Pakistan’s agricultural and overall growth rates are bound to decline significantly. Indeed, that decline is already underway. Correct pricing, investment, and institutional development policies can reverse that decline and accelerate growth rates well beyond those of the past. Agricultural price policy is of central importance in its own right and plays an important indirect role in each of the other key policy areas. Thus, this paper, while concerned with agricultural growth and its multipliers, wraps the discussion around price policy issues.