KARACHI, January 31 2025: The State Bank of Pakistan (SBP) hosted the Agricultural Credit Advisory Committee (ACAC) meeting in Multan, reaffirming its commitment to expanding agricultural financing and ensuring sustainable growth in Pakistan’s agriculture sector.
Addressing the participants, SBP Governor Jameel Ahmad emphasized the critical role of agriculture in Pakistan’s economy, linking it to food security, rural employment, and industrial progress. While acknowledging the sector’s challenges—including climate change, low productivity, and financial exclusion—he urged banks to consider agricultural financing as a key business priority.
Governor Ahmad highlighted that while agriculture recorded robust growth in FY24, the sector’s expansion slowed to 1.2% in Q1-FY25, down from 8.1% in the previous year. This deceleration also contributed to a decline in overall GDP growth to 0.9% from 2.3% in Q1-FY24. He stressed the importance of resilience and innovation in agriculture, especially with early indications of a modest wheat harvest.
The Governor acknowledged the record-breaking credit disbursement of Rs. 2,216 billion in FY24—a 25% annual increase—and the Rs. 1,266 billion already disbursed in the first half of FY25. While the number of borrowers has risen to 2.86 million, he called on banks to further expand rural outreach by designating more branches for agri-lending and deploying additional agricultural credit officers.
Looking ahead, Governor Ahmad urged banks to fully implement their Agricultural Credit Expansion Plans and enhance their investments in digital technologies, infrastructure, and human resources. He encouraged collaboration with government departments, fintechs, microfinance institutions, and Agri-Tech firms to develop digital loan solutions and advisory services for small farmers.
He outlined three key focus areas for stakeholders to drive agricultural transformation:
- Building Climate Resilience: Banks must support climate-smart agriculture through green financing, risk mitigation strategies, and farmer training programs to ensure food security and sustainable growth.
- Leveraging Technology: Pakistan must adopt geo-spatial technologies for precise crop monitoring, improved resource management, and minimized production risks. Pilot projects can help integrate these tools into farming practices.
- Strengthening the Livestock Sector: Contributing 14% of GDP and 2.1% of total exports, livestock presents a massive opportunity for income diversification and reducing reliance on traditional crops. Advanced breeding, dietary improvements, and manure management can enhance productivity and align with Pakistan’s climate goals of reducing greenhouse gas emissions by 50% by 2030.
Governor Ahmad also addressed concerns raised by farmers from Baluchistan, announcing that SBP will lead a collaborative initiative in Quetta to tackle agriculture credit challenges. He urged other provinces to follow this model to ensure equitable financial access for farmers nationwide.
The meeting also featured a special session on climate-smart agriculture, highlighting geo-spatial technologies for precision farming and resource optimization. Participants discussed the Climate Resilience Fund, a World Bank initiative aimed at helping microfinance banks finance climate adaptation in agriculture.
Concluding the session, Governor Ahmad emphasized the immense untapped potential of Pakistan’s agriculture sector. He called on banks, policymakers, and technology providers to work together to expand financial access, drive innovation, and build a resilient, globally competitive agricultural sector.
The ACAC meeting, a key initiative under SBP’s leadership, brought together commercial and microfinance bank presidents, federal and provincial government officials, and representatives from Chambers of Agriculture and Farmers’ Associations.
