Social profitability of wheat and oilseeds production in Pakistan
2001
Ashiq, R.M. (Agricultural Prices Commission, Islamabad (Pakistan)) | Ahmed, M.I.
Huge amounts of foreign exchange are annually spent on the import of wheat and edible oils. It has ever been a policy concern for the government to minimize their import bill through inter alia encouraging domestic production. However, given the constrained availability of cultivated land and water we have to opt either for wheat or for oil seeds. This paper investigates which of the two is socially more profitable to produce at home. The analysis carried out indicates that wheat production has an edge of Rs 3,323 per acre over sunflower and of Rs. 801 over canola cultivation. Social cost benefit and domestic resource cost ratios are lower for wheat than for oilseeds implying again the comparative profitability of the former over the latter. Being both import commodities, promotion of oilseeds at the cost of wheat, thus may not be desirable. Instead of providing protection and institutional and financial support, emphasis should be on enhancing per acre yields of sunflower and canola, the only two promising crops for increasing domestic edible oil production and hence curtailing edible oil import bill. For improving yield of sunflower and canola a number of recommendations have been included in the paper.
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