An interview with Simi Kamal, Head of Programmes, Pakistan Poverty Alleviation Fund (Part-II)

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Last week, BR Research published first part of its interview with Simi Kamal. That conversation focused on her current role as Head of Programs at Pakistan Poverty Alleviation (PPAF). The first part was published on May 13th, 2019 and can be accessed here:

While her work with the social sector takes her to regions of extreme poverty in rural areas, her lifework has been centred on the themes of water and livelihood security. She takes a special interest in topics at the intersection of water and agriculture, both on academic and policymaking level. Her command over the issues facing the water sector has made her a globally recognized authority on the subject.

As part of BR Research’s on-going coverage of water insecurity in Pakistan, excerpts from second part of the conversation focus on Simi Kamal’s frank views on challenges facing the water economy.

BR Research: In our previous conversation, you referred to agriculture as Pakistan’s economic backbone. But historically, we have seen countries graduate from low income to middle- and upper income brackets only once greater proportion of their labour force moves from primary to secondary & tertiary sectors.

Simi Kamal: Yes, that may be true in the classical economic development model. But one should be careful in applying box standard solutions everywhere, because underlying dynamics vary between societies.

Take USA and Canada; for example, where on average three people manage a farm of 400 acres, because of access to mechanisation. And the reason for greater reliance on mechanisation is lower labour force in rural areas.

On the other hand, Pakistan has a fast-growing population, especially in rural areas. Rather than hastening our transition into mechanisation, we should engage these people in agriculture. Unless the rural labour force is presented with better employment opportunities elsewhere, mechanisation will only result in people being thrown out of their land with nowhere else to go.

The solution is to develop agriculture-based value chains, instead of exporting the raw material without value addition.

BRR: Let’s come to our favourite subject: water. Agriculture appears to be Pakistan’s most water-intensive sector, consuming close to 95 percent of total available freshwater sources according to some sources. Is this figure based on latest research?

SK: The figure comes from WAPDA and is likely a projection based on data from the time when quality research and data collection was still conducted in Pakistan. As you know, WAPDA has been a moribund organisation for many years now. The research landscape on water sources and their consumption over the last twenty years has been quite barren. While the irrigation system does provide some data, it is mostly locked up with provincial irrigation department and is rarely shared.

The problem is in the attitude; bureaucrats rarely pay heed to subject experts from private sector. Moreover, due to the elite capture of political economy, those in power don’t want available data becoming public, as they fear repercussions for their excessive use. That is because feudal relations, and not productivity, determine whether a farmer may have access to water, land, electricity, and government subsidy.

Pakistan needs to develop robust ways of collecting real-time data; whereas existing database need to be shared with research organisations and academia to advance knowledge base. We need to build bridges between academia and society by ensuring that the former produces demand-driven research on water.

While PPAF itself is not a research organisation, I am part of a research initiative called “Universities for Water Network”. In addition, I also convene a think tank for rational use of water under Hisaar Foundation. The idea is to have the best brains coming up with the solutions and advising the government.

But as things stand, currently we have no credible numbers on agriculture’s share in water consumption. Although we may use production and export figures from PBS and SBP’s annual reports on economy to reverse engineer a trend. Moreover, cities use a very tiny proportion of available freshwater resources. So, agriculture is still the major consumer; but what the exact number is anybody’s guess.

BRR: Another number often quoted is that more than 80 percent of water is consumed by four major crops. The need for improved crop mix is well-taken; however, these crops-based exports also contribute up to three-fourths of total export earnings. So, while Pakistan may be virtually exporting its water, given perennial balance of trade challenges, few meaningful steps can be taken to change the crop mix. Do you agree?

SK: Pakistan fails to state its case clearly in global economic relations. We should be able to get much better terms for our exports. Instead, we are faced with export quotas. Diplomatically, we are positioned in such a grey area that it has become very difficult for Pakistan’s foreign and commerce policymakers to act gung-ho; our bargaining position remains very weak.

Let’s look at the textile industry; everything is produced here; yet, textile manufacturers sell to importers abroad who sell the stuff back here at thirty times the premium. That’s not to say that we lack the potential in branding; Khaadi and Chen One are successful examples which have been able to make a dent in markets abroad.

Thus, while there is a need to improve crop mix, that’s not to say that raw materials such as cotton should be discouraged altogether. Instead, the focus should be on value-addition, so that Pakistan earns a higher buck for its agricultural output.

And the problem is not limited to high water footprint of cash crops. Our banks are also very risk averse, and do not support small- and medium-sized enterprises in value-addition chain.

BRR: But the perverse incentive structure for banks is stacked against commercial agri-lending beyond that undertaken by ZTBL. For example, the natural climatic risks facing agriculture (and even livestock) means that farmers are clubbed together as very high-risk obligors; and statutory requirements restrict exposure to that group under very prohibitive limits.

SK: Does that mean if the incentives change, so shall the banks’ risk-taking behaviour? Then the policies need to change, which is where the government needs to step in.

Moreover, I am not only referring to bank’s lending to agriculture sector. What about banks’ lending practices to develop the businesses in the downstream value-chain of cotton, wheat and other crops? If we are to move towards low-delta and high value crops, banks’ need to invest to make that change happen.

It is not enough to tell farmers that they need to change the crop mix for the sake of national water conservation. Banks, as stakeholders in this economy, need to provide the required investment to farmers willing to take that leap. Once the pioneers become success stories, soon others will follow.

I do see banks’ dilemma – historically, feudal families have been the primary beneficiary of lending to the sector – especially those who lack the willingness to repay. But there is nothing stopping Pakistani banks from forming lobby groups to turn politically entrenched interest groups down. Instead, they happily continue to lend to the same landlord families, while majority of the sector remains starved off credit.

For example, only those who own a parcel of land have a right to water from canal irrigation system. Landless people suffer hugely because they can neither access water supply nor have the collateral required by banks (land) to raise funds. Thus, organisations such as PPAF and other microfinance firms step in to perform banks’ role.

BRR: What actionable steps can be taken in that direction?

SK: Pakistan needs to work on water laws and rights so that the resource is also distributed amongst the landless. A major part of agriculture is done by mazareen or tenants on crop sharing basis. Those who own the land have rent seeking behaviour. They wish to invest as little as possible in developing the land, while extracting maximum benefit by renting it out. Compare this to rest of the world, where it is understood that landowners are also farmers themselves.

Land relations in Pakistan dominate politics. Because landlords are also lawmakers, it is foolish to hope that they will legislate against their vested interests. Yet they continue to be voted in by the same landless class because the biraadari and tribal relations force the exploited to vote against self-interest.

Nevertheless, all hope is not lost. There are several ways of bringing change. PPAF is not in the business of creating social upheaval. Instead, we help federate the voices of people from community-based and UC-based organisations, so they may engage in dialogue with their elected representatives.

This requires empowering them by giving them economic assets and helping build businesses to pull out of poverty. All of this should eventually lead to the scale needed to bring about change in not only how our politics work, but also how banking and other sectors of the economy engage with the poor.

BRR: On that note, do you believe Pakistan needs another round of land reforms and redistribution?

SK: Yes. Look at the history of northern Punjab. Average land size in this region is small and so is extreme poverty - thanks to past instances of land reforms. It is not as if these areas are flush with water; instead, greater share of agricultural output comes from southern Punjab regions.

There are two lessons here: first, water inequity is less a function of upstream and downstream, and more a function of distance from canal. The tail-enders suffer most from water insecurity, irrespective of geographic region.

Second, southern Punjab and northern Sindh have a higher incidence of extreme poverty because of feudal profile of these regions.

BRR: But Pakistan currently has one of the smallest average land sizes in the world, which some argue has worsened agricultural productivity.

SK: In that case, a mapping exercise is needed to identify where smaller landholding size is concentrated, and whether it correlates with indicators of low HDI and high poverty. To my knowledge, larger tribal-feudal landholdings are concentrated in Balochistan, Sindh, and areas of southern Punjab, which not only rank high on extreme poverty, but also have highest rates of honour killing.

In contrast, KP has highly democratic social norms, albeit only amongst men. I often compare it to ancient Rome, where a semblance of primordial democracy existed among patricians. One finds that incidence of extreme poverty is relatively lower where tribal-feudal loyalties are not absolute.

BRR: Reverting to the intersection between water and agriculture. Research indicates that livestock’s footprint on water is of much higher magnitude than traditional crops. In order to take meaningful steps for water and environmental conservation, does Pakistan need a societal shift away from a meat-intensive diet?

SK: Let’s set the context first. Due to its contribution to GDP in absolute terms, livestock has come to be perceived as a growth sector. Yet we are still importing milk, which is a higher value-add product. That’s because our livestock sector is geared towards meat production.

Not only is milk far more sustainable, it also contributes toward food security if the animal owned and cared for by women. While we are one of the top ten milk producing nations, we still suffer from insufficiency.

Even as dairy companies have setup collection centres in rural areas, on-farm availability of safe milk has not seen marked improvement. Because we have failed to develop the value chain. There is little investment or research in rangeland management, for example. Add to this the wastage in food industry, which nobody seems interested in addressing, at least not at the policy level.

Pakistanis needs to start talking about the need for a drastic change in our lifestyles. The shape our economy takes in future should be dictated by the principle of reduced human footprint on the planet. If that requires changing the crop mix or meat consumption significantly, so be it.

BRR: Would you term the spectre of “Pakistan running dry by 2025” as fear mongering? Given that per capita water availability is projected to drop to under 1,000 cubic metres by that year.

SK: It has already that level; but it is inaccurate to portray that severe water scarcity. That news item was based on a misattribution to PCRWR in the media.

Water scarcity is a relative concept, which depends on the water-intensity of economic activity taking place in a certain area and its population. Pakistan, which is primarily an agricultural nation, will reach water shortage at a much higher level than Middle Eastern countries that mostly consist of deserts and depend on imported food.

Whether per capita availability of water in a given region may be labeled abundant or scarce is a function of demand for water. Absolute measures of per capita demand accepted previously are now being challenged. For example, experts note that WHO’s guidelines for 50 litres per person (required for domestic consumption) is grossly overestimated, and that people can survive on as low as half or one-third that amount.

Elsewhere around the world, if there is a water shortage, laws are adapted to dissuade wastage. So much so that carwash from tap water becomes a crime punishable by imprisonment.

BRR: Is the problem then primarily of inequity? Could you explain for our readers what that entails?

SK: As I explained before, water rights in Pakistan are contingent upon whether one owns land or not. That is the first inequity and on which our entire agricultural system is built.

That principle also extends to cities. Those who own land, have a right to water from the utility organisation up to the boundary. However, those who live in katchi abadis possess no such right.

Second the inequity between proximity or distance of agricultural land from the canal is just as glaring; followed by differences in upstream and downstream availability. Third, the inequity between availability of water in barani (rain-fed) areas and those irrigated by canal system.

BRR: Can water pricing be a useful tool in addressing inequity? Or will a market-based mechanism exacerbate the inequitable distribution by making the resource dearer for the poorest?

SK: Of course, human race can never escape inequity. However, that does not take away the basic right of every citizen to a minimum amount of water requirement: whether that is calculated at 25 litres or less is up to debate.

And the government is responsible for ensuring that everyone has access to that minimum amount. Beyond that, water should be priced like any other service or input, particularly for productive sectors of the economy; whether that may be for industrial or agricultural use.

One of the ideas I have been expounding for a very long time is the reallocation of water rights between geographic regions. In light of the massive rural to urban migration, every person who moves into a city should bring their water rights with them.

BRR: It is it correct that Pakistan’s groundwater laws have remain unchanged since colonial era? What changes would you propose to the existing framework?

SK: First, an immediate halt needs to be put on installation of new tube wells. Then, an extensive study needs to be undertaken to assess the groundwater levels (and their pollution) across the country.

Only once the assessment is complete should new tube wells be allowed and only in those regions where there are no alternates available. But how can existing tube wells continued to be allowed in upstream canal-irrigated regions?

BRR: Is it true that excessive abstraction of groundwater is as much a behavioural problem? For example, farmers over-abstract and apply groundwater early into the sowing based on experience of irregular availability of canal water during past seasons? Are their ways to address such behavioural challenges through policy intervention?

SK: I have spent years working with farmers across the country and appreciate these fears. It is a matter of livelihood; the situation is already too precarious for them due to changes in weather patterns, and many of them are living on the edge.

The responsibility falls with the government to make policy interventions to streamline agriculture sector and use of water therein. For example, the government may determine the ideal crop mix for each region suitable to its climatic conditions and prohibit farmers from planting any other varieties. At the same time, it should ensure that farmers are provided with appropriate support: be it in the form of seeds or fertilizer.

Similarly, government should sponsor research that determines the timing and quantity of water required for crops in each region – and then ensure that the required amount is provided for. If surface water is unavailable or insufficient, let them abstract groundwater, but with regular oversight and monitoring.

BRR: Do you believe that water metering may be the intervention needed at micro-level to avoid over-abstraction of groundwater in agriculture?

SK: No. I believe water metering is needed and may work in the cities. However, in rural areas, metering may not work: the landowning mindset is bent on rigging the system and has the comfort that it can get away with rule breaking. It will break the meter too.

In rural areas, a whole mix of interventions is needed. First, indigenous seeds need to be reintroduced because they are most suited to climatic and soil condition of native region and require lower amounts of inputs in the form of water and fertilizer.

Second, in line with best practices around the globe, agro-ecological zones need to be defined. Based on which crop-mix may be determined. Farmer training and education in this respect also needs to be undertaken.

Once the bases have been aligned, value chains will develop on their own. Commercial lending will also suit because banks will have greater comfort in the knowledge that policy measures have been taken to mitigate risk of crop failure.

BRR: Do you believe for any policy initiative on water to succeed, provinces need to take up the baton?

SK: The way constitution is written right now; water is a provincial subject. But if we are a nation, then some things need to be addressed nationally. Those who criticise national water policy forget that countries such as India with a much more decentralized federation also have a national policy on the subject.

The need is to introduce water policies at provincial and district levels in line with the national guidelines. Being a provincial subject does not mean that provincial government have carte blanche on water allocation. Provinces need to ensure basic water rights of every citizen, rather than distributing the resource between their favoured landlords. Similarly, they also have equal responsibility of ensuring environmental flows to the sea.

To conclude, provinces should introduce pricing of water beyond basic human right; and then market mechanism will ensure that water flows to those productive sectors of the economy which place the highest value on the resource as an input.