Agriculture is not merely another sector of Pakistan’s economy. It is central to food security, rural employment, industrial activity, exports and the livelihoods of millions of households. Punjab, being the country’s principal agricultural province, has a particularly important role to play. Consequently, the province’s agricultural policies have implications far beyond its rural economy.
Under Chief Minister Maryam Nawaz Sharif, agricultural mechanisation has emerged as a prominent policy priority. The Green Tractor Programme, subsidies for tractors, high-horsepower machinery and efforts to expand local tractor manufacturing are among the initiatives aimed at improving farmers’ access to modern technology. Viewed collectively, these measures represent an attempt to link agricultural productivity with industrial development.
Yet the other side of the agricultural equation is equally important: wheat procurement, remunerative prices for farmers, storage and food security. This is where the government’s agricultural strategy faces a more complex test.
Mechanisation and the Green Tractor Programme
The high cost of tractors and modern farm machinery has traditionally been a major constraint for small and medium-sized farmers. Subsidised access to tractors can potentially reduce production costs, improve the timeliness of cultivation and increase farm productivity.
According to figures provided for this analysis, around 10,000 tractors were supplied to farmers in Punjab over the previous two decades, while about 35,000 tractors are claimed to have been distributed during the first two-and-a-half years of the Maryam Nawaz administration. Similarly, agricultural mechanisation spending is reported to have risen from roughly Rs3 billion over the preceding two decades to around Rs20 billion during the current government’s first two-and-a-half years.
If these figures are verified, they indicate a significant shift in policy emphasis towards mechanisation.
Under Phase IV of the Green Tractor Programme, 10,000 tractors in the 50-65 horsepower range are reportedly being subsidised by Rs750,000 each. Phase V provides a subsidy of Rs1 million for 9,500 tractors with capacities ranging from 75 to 125 horsepower. An allocation of Rs17.6 billion has reportedly been made for the programme.
The economic significance of such a programme lies beyond the tractor itself. Timely land preparation, sowing and harvesting can improve farm efficiency and potentially raise yields. Mechanisation can therefore become an important component of agricultural productivity.
Linking Farmers with Industry
An important dimension of the programme is its potential to strengthen domestic manufacturing. Local production of 90-horsepower tractors and assembly of 100-horsepower models could help connect agricultural policy with industrial policy.
The economic chain is straightforward: higher tractor demand can support local manufacturing, which in turn creates demand for spare parts, engineering services and skilled labour. If linked with research, technology transfer and local value addition, mechanisation could become more than a subsidy programme; it could contribute to industrial development.
But higher production must ultimately translate into higher and more predictable farm incomes.
The Wheat Question
This is where wheat becomes a crucial test of agricultural policy.
Providing farmers with machinery is only one part of the equation. Farmers also need confidence that they will have a viable market for their produce. If productivity rises but farmers face weak prices or uncertainty after harvest, the benefits of mechanisation can remain limited.
According to the figures provided, Pakistan produced around 29.78 million tonnes of wheat this year, while approximately two million tonnes from the previous year were reportedly available in stocks. Total availability was therefore estimated to be around 125,000 tonnes above national requirements.
Yet wheat and flour prices have continued to face pressure, while some provinces have reported additional requirements. This suggests that the problem is not necessarily one of production alone. Procurement, storage, transportation and market management are equally important.
Procurement: The Missing Link?
The Punjab government had reportedly set a target of purchasing three million tonnes of wheat from farmers but managed to procure only around 480,000 tonnes.
The gap deserves policy attention. On one hand, the government is encouraging farmers to increase productivity through tractors and mechanisation. On the other, if procurement arrangements do not provide sufficient market support for a major crop, farmers continue to face substantial price risk.
The next phase of agricultural policy should therefore focus on supporting the farmer from production to market.
A comprehensive framework could operate at three levels. First, productivity must be raised through better seeds, fertiliser, irrigation, machinery and technology. Second, procurement and storage capacity should be planned before harvest, with transparent participation by both public and private storage operators. Third, farmers need timely market signals, smoother inter-provincial movement of wheat and timely decisions regarding imports or exports when required.
Beyond the Tractor
Farmers need more than machinery. They also face high costs of seeds, fertiliser, diesel or electricity, water, pesticides and climate-related risks. A broader “Green Agriculture” package could therefore include modern irrigation, solar-powered tubewells, drip irrigation, certified seeds, agricultural research, crop insurance, storage facilities and digital agricultural markets.
Agricultural taxation is another part of the broader reform debate. Agriculture is estimated to account for around 24.5 per cent of the economy, while its contribution to tax revenues is reportedly only 0.3 per cent. If these figures are accurate, integrating agricultural income more effectively into the tax system is a legitimate fiscal policy issue.
However, taxation should distinguish between small and medium farmers and large agricultural incomes. Revenue generated through reform could, in part, be reinvested in irrigation, research, market infrastructure and farmer support.
From Green Tractors to Green, Market-Linked Agriculture
The long-term impact of Punjab’s agricultural initiatives will depend on how effectively different programmes are integrated. Tractor subsidies should raise productivity; local manufacturing should strengthen industry; modern irrigation should reduce costs; market reforms should provide farmers with greater price certainty; and agricultural revenues should help finance better infrastructure.
The success of the policy should ultimately be measured through tangible indicators: Has farm income increased? Have production costs fallen? Has wheat price volatility declined? Have agricultural imports been reduced and exports increased? Has domestic agricultural machinery manufacturing become stronger? Most importantly, do farmers have greater confidence about the price they will receive for their crops?
The Green Tractor Programme and the broader focus on agricultural mechanisation represent an important policy direction. But the wheat experience underlines a fundamental point: agricultural development does not end at the farm gate.
The farmer needs support throughout the journey from seed to market. If higher productivity leads to higher farm incomes, stronger rural demand, greater industrial activity and more employment, agricultural policy can become a driver of structural economic change.
For Punjab, therefore, the next step may be to move beyond the Green Tractor Programme towards a green, productive and market-linked agricultural economy-one in which the farmer is supported not only when planting a crop, but until that crop reaches a reliable and remunerative market.
