In Pakistan’s rural areas, rising mechanisation in the agriculture sector has become a major driver of growing unemployment. Traditionally, in the country, mechanisation was synonymous with tractorisation — simply increasing the number of tractors. However, the current phase of agricultural mechanisation is powered by a much wider array of machines, including combine harvesters, half-feed rice harvesters, rice transplanters, corn pickers, corn planters, and vegetable harvesters.
With declining commodity prices and soaring input costs, farmers’ purchasing power has significantly weakened, as reflected in the sharp decline in tractor sales in the past two years. Given that these machines are priced in millions of rupees, they are now predominantly purchased by businessmen who offer rental services to farmers at their doorstep.
Though mechanisation appears to be a natural progression for Pakistan’s agriculture sector, the recent phase has drastically reduced the demand for seasonal agricultural labour — traditionally supplied by entire rural families, including women and children. Farmers are increasingly turning to machines to save time, avoid labour-related issues, and, most importantly, reduce costs, as rental charges are often lower than those of manual labour.
One of the less-discussed drivers of mechanisation is the recent trend to increase cropping intensity — from two to three crops annually in irrigated areas — by adopting short-duration crop varieties (90–120 days). However, this shift has significantly narrowed the crop sowing and harvesting windows, making mechanisation essential, particularly for medium- and large-scale farmers. Notably, the push for higher cropping intensity is largely a response to mounting economic pressures stemming from land division over generations and declining crop profitability in recent years.
With rising mechanisation in agriculture and a slow-growing industrial sector, the wave of rural workers’ displacement may rise
Although the cultivated area of Pakistan is expanding, it is primarily under corporate farming, which relies almost entirely on mechanised systems. This reinforces the trend toward jobless growth in agriculture.
Against this backdrop, a pressing question arises: where will this displaced labour go — especially when nearly three million young people enter the job market each year, the majority of whom live in rural areas? More importantly, what is the government’s employment strategy to address this mounting challenge?
It is highly likely that a large segment of this displaced labour will seek daily-wage work or other employment opportunities in urban centres. However, the industrial sector — already grappling with high energy costs and heavy taxation — has experienced minimal or even negative growth in recent years. Many experts warn that this downward trend may intensify, as the government moves ahead with tariff reforms — under the upcoming National Tariff Policy 2025-2030 — aimed at trade liberalisation, which includes reducing customs and regulatory duties on imports.
For most unskilled workers, livestock — which made up 60.8pc of agricultural GDP in FY24, and is also exposed to trade liberalisation risks — is the only fallback
Therefore, for the majority of these displaced workers, who are largely uneducated and unskilled, the only viable fallback is the livestock sub-sector, which contributes 60.8 per cent of the agriculture sector’s GDP (FY24) and supports the livelihoods of over 80 million livestock farmers either fully or partially. Yet livestock is also vulnerable to government trade liberalisation policies.
Currently, imported skimmed milk powder and whey powder are subject to 20pc customs duty and 25pc regulatory duty. Any reduction in these duties is likely to boost imports of skimmed milk powder and whey powder, which already stood at around 11,000 tonnes (worth Rs9.2 billion) and 19,200 tonnes (worth Rs5.7bn), respectively, during FY24. Past experience indicates that the availability of cheap powder leads milk processors, confectioners, sweet makers, bakeries, biscuit factories, ice-cream makers and even informal milk sellers to mix or fully substitute fresh milk with substandard whey powder or milk powder.
This act not only compromises consumers’ health but also pushes millions of small and subsistence-level livestock farmers to the verge of devastation. Production costs have already risen sharply in recent years, while the farm-gate price of fresh milk in many rural areas remains even lower than the retail price of bottled water.
Pakistan lacks high-yielding livestock breeds that are suitable for rearing by small and subsistence-level farmers under local conditions. This factor virtually eliminates the possibility of competing on the international stage. Improving local breeds and ensuring their widespread adoption at the grassroots level is a long-term process that could take decades. Moreover, contrary to the industrial sector, such a transformation is unlikely to happen without sustained government intervention and support — something the government has consistently failed to provide, even after 77 years.
The government’s tariff reform agenda, based on the academic premise that lower tariffs will lead to short-term import surges followed by long-term export growth and job creation, in fact, fails to reflect the realities of Pakistan’s agriculture sector — especially livestock.
In conclusion, the growing wave of unemployment, particularly in rural areas, underscores the urgent need to align the national employment policies with economic growth policies. History has shown that persistent unemployment, when left unaddressed, often fuels social and political unrest, leading to a rise in the crime rate. Therefore, employment creation must become a central pillar of national economic.
Khalid Saeed Wattoo is a farmer and a development professional, and Dr Waqar Ahmad is a former associate professor at the University of Agriculture, Faisalabad.
Published in Dawn, The Business and Finance Weekly, June 2nd, 2025
