KHYBER PAKHTUNKHWA ECONOMIC ACTIVITY

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Economic Activity

Agriculture is as important as in the other provinces, and more than 80% of the rural population depends on agriculture[1] for survival. Mining is also a very important economic activity, with marble being mined at Buner, and gems in Peshawar, Mingora, and Chitral.

Some manufacturing and high tech investments in Peshawar have helped improve job prospects for many locals, while trade in the province involves nearly every product. The bazaars in the province are renowned throughout Pakistan. Unemployment has been reduced due to the establishment of industrial zones.

The major economic activities of the province (according to the 1998[2] Census) are:

  • Agriculture, Livestock Breeding, Fishing & Hunting (42.1%)
  • Community Services (21.7%)
  • Construction (14.5%)
  • Wholesale/ Retail, Hotel/ Restaurant (9.4%)
  • Manufacturing (2.7%)
  • Elementary Occupations (2.3%)
  • Transport, Storage & Communication (5.7%)
  • Others (1.6%)

[1] Khyber Pakhtunkhwa Comprehensive Development Strategy 2010-17. Planning and Development Department.

[2] 2017 Census data has not been made public yet.

Land UseAgricultureLivestock Breeding –  Poultry – FishingBeekeeping/ ApicultureIrrigationMinerals and MiningIndustryHandicrafts

Land Use

The major land use in KP is forestry; it is the major cash generating activity in the province. 65% of the total land area of KP falls within the management responsibility of the Forestry Sector. In fact, around 40% of Pakistan’s forests are located in this province.[1]

The following table shows the land use pattern as reported in KP Development Statistics 2018-19:

Geographical Area 7,452,100 HA Reported Area[2] 8,355,157 HA
Cultivated Area 1,858,522 HA Net Sown 1,286,315 HA
Current Fallow[3] 572,118 HA Un-cultivated Area 6,496,635 HA
Culturable Waste 1,337,321 HA Forest Area 1,238,954 HA

Table ‎1.8 KP Land Use Statistics

KP is home to coniferous and scrub forests, and the province’s forest resources comprise of deodar, pine, chilghoza, fir, nandar, partal, kail, and other trees.

[1] Khyber Pakhtunkhwa Comprehensive Development Strategy 2010-17. Planning and Development Department

[2] Total physical area of the province

[3] The area that has not been cultivated during the reporting period

Agriculture

Agriculture is a very important economic activity of KP. The sector is the largest employer, and employs 42% of the total labor force. The most important food crops of the province are wheat and maize. KP produces 8% and 60% of the total wheat and maize grown in Pakistan respectively. Sugarcane and sugar beet are major cash crops. About 15% of the total sugarcane of Pakistan is produced in KP; sugar beet is grown in Charsadda and Mardan which is a very efficient sugar crop, and produces more sugar than sugarcane. Tobacco is another cash crop which accounts for more than 90% of the total tobacco grown in Pakistan. About 30 varieties of fruits are produced in KP and as many varieties of vegetables. In certain high elevations, off-season winter vegetables are grown in the summer, making many vegetables available throughout the year[1] for trade within Pakistan.

[1] Muhammad Aslam Khan. “Agricultural Development in Khyber Pakhtunkhwa: Prospects, Challenges and Policy Options” Pakistaniaat: AJournal of Pakistan Studies, vol. 4, no. 1, 2012, p. 49-68.

Livestock Breeding

Livestock farming is a dominant occupation of the farming community, with more than 15 million animal heads and about 22 million poultry birds in the province. However, livestock breeding as an occupation is mostly used to supplement family nutritional and cash requirements. The capitalist trend in this sector is still lacking, resulting in weak and non-descriptive breeds, with low levels of milk and meat production.

The following table shows the livestock position in KP as per Livestock Census 2006 (KP Development Statistics 2018-19):

Cattle 4,422,358 Heads Buffalos 1,801,658 Heads Sheep 1,685,748 Heads
Goats 6,180,537 Heads Camels 41,669 Heads Horses 57,942 Heads
Asses 409,185 Heads Mules 29,415 Heads

Table ‎1.9 KP Livestock Statistics

Important breeds of sheep in the Alpine pastures include Rambouillet, an imported American sheep breed, and genetically improved local sheep breed ramghani as well as kaghani. Other breeds include bulkhi, beetal, gaddi, and angora breeds of goat.

Achai cattle, lohani cattle, rojhan cattle, and azi kheli buffalos are important bovine breeds.

Poultry

In Pakistan, poultry farming has a growth rate of 15-20% per annum and its share in the GDP is 1.1%. Commercial poultry farming in KP, as in other provinces of Pakistan, is mostly concentrated around the urban centers.

According to Table 17 (Number of Commercial Poultry Farms and Number of Birds by Size of Flock), there are 2,674 poultry farms in the province.

Fishing

Geographically, the province could be divided into 2 zones. One is the northern zone, extending from the ranges of the Hindu Kush to the borders of the Peshawar basin. This zone has very cold winters and thus cold water fisheries prevail here. The other is the southern zone, extending from Peshawar to the Derajat basin where fish is found in abundance. Cold water fish, especially trout, is plentiful in the waters of River Chitral. Fishing is carried out in all the rivers of KP and is a source of income and sustenance.

Bee Keeping/ Apiculture

Honey is an important non-wood forest product in KP; the province’s environment supports flora viable for honey production. However, people usually follow traditional management practices. The Government of KP is providing training to its rural population in the art of apiculture and honey processing, which has helped improve apiculture in the province.

There are many types of honey being produced in KP but Sedar (ber in Urdu) and acacia modesta (Phulai in Urdu) honey are the most common types. The total number of the bee keeping entrepreneurs (farm) in KP is about 3,800 and the number of people[1] employed in these farms is 17,500.

[1] Small Medium Enterprise Development Authority (SMEDA), Honey Processing & Packaging Common Facility Center, Mingora Swat

Irrigation

The irrigation system of KP is comprised of 13 canal systems, with a total length of 3,444 km (2,140 miles) and total discharge of 14,000 cusecs. These canal systems[1] are listed in the following table:

  Name Length (km) Discharge (Cusecs) Command Area (Acres)
1 Upper Swat Canal System 841.6 3,600 281,000
2 Lower Swat Canal System 308.8 1,940 134,500
3 Pehur Main Canal System 121.6 250 44,888
4 Pehur High Level Canal System 25.6 1,000 10,531
5 Warsak Canal System 198.4 595 107,414
6 Kabul River Canals System 121.6 800 72,000
7 Tanda Dam Canals System 89.6 363 31,600
8 Marwat Canal Systems 267.2 800 170,500
9 CRBC 724.8 3,000 350,000
10 Paharpur Canal System 264.0 870 113,049
11 Bannu Canal System 256.0 600 107,500
12 Balambat Irrigation System 75.8 125 11,363
13 Siran Canal System 149 75 11,250
Total 3,444 14,000 1,445,600

Table ‎1.16 KP Irrigation Statistics

In addition to the irrigation system, the southern districts, like Dera Ismail Khan, Lakki Marwat, Bannu, Karak, and Tank, depend upon spate irrigation or the Rod Kohi system of irrigation. In this system, water from the hill torrents is harvested and used for irrigation.

The following table shows the mode of irrigation and area irrigated[2] by the mode:

Total Irrigated Area 953,048 HA Canal Irrigated (Private) 283,674 HA
Tube Wells 102,373 HA Wells 49,926 HA
Lift Pumps 33,388 HA Canal Irrigated (Government) 448,270 HA
Tanks 1,678 HA Others 33,739 HA

Table ‎1.17 KP Irrigation Statistics

[1] Official Website Government of Khyber Pakhtunkhwa, Irrigation Department.

[2] Khyber Pakhtunkhwa Development Statistics 2018-19

Minerals and Mining

KP’s topography is dominated by the occurrence of mountainous terrains of the eastern Hindu Kush, and western Himalayas in the north, and Samana Rang, Sur Ghar Range, and Marwat Range in the south. These ranges constitute about 70% of the total area of the province, containing mineral deposits that are being mined. Malakand Division, in fact, has unmatched potential in marble, granite, gems, Hydel Power Generation, horticulture, apiculture, and tourism. These resources have created economic opportunities centered on mining.[1]

Large deposits of marble/ granite, cement-grade limestone, phosphates, soapstone, nepheline syenite, and other industrial minerals, as well as gemstones and metallic minerals are found in the northern parts of the province. The southern part of the province also has extensive potential for the mining of industrial rocks and minerals which include rock salt, gypsum, clay minerals, limestone, silica sand, iron ore, and coal.

According to estimates, there are approximately 3 billion tons of marble in the province. The main locations of these include the Chitral marble block (with a potential of more than 1,000 million tons), Shangla Par, Swat (with marble of more than 200 million tons), the Buner marble belt (with geological resources of 1,400 million tons), the Swabi marble block (with about 200 million tons) and Nowshera pink marble (with about 100 million tons).[2]

USAID’s report[3] on granite resources estimates that there are 100 million tons of granite. The potential occurrences of dark coloured granites, mostly with green shades, are more than 1,000 million tons, and light coloured granite is more than 1,000 million tons as well.[4]

Gemstones found in the province include the Pegmatite-hosted beryl tourmaline topaz-garnet clan occurring in Chitral; Corundum/ ruby in Timergarah and Swat area; emeralds in the 50 km long Swat emerald belt in Swat; Carbonate-Hosted topaz (pink, yellow, white and other shades) in the Mardan/ Katlang areas; Meta-sediments-hosted Corundum (ruby and sapphire) in upper Kaghan Valley; and Ultramafic-hosted peridot gem in Kohistan, extending up to Kaghan Valley, among others.[5]

The oil and gas sites in KP are mostly located in the Potowar region, where almost all the major oil/ gas fields (like Chanda, Tul and Nashpa) are situated. Recently, KP has emerged as a significant contributor to the Energy Sector of Pakistan, on the heels of major oil and gas discoveries in the province. In addition to hydro energy supply, this province is contributing significant amounts of hydrocarbons (18.3% oil and 2.1% gas) to the primary energy supply of Pakistan. Most of the area of KP is still unexplored, however, and therefore, there is a potential for future hydrocarbon prospects in the province. The Kohat sub-basin, a northwest extension of the Indus Basin in KP, is the main hydrocarbon producing basin of the province.[6]

[1] Board of Investment Pakistan, Investment Opportunities KP

[2] Board of Investment Pakistan, Investment Opportunities KP

[3] Marble/Granite Quarrying and Processing Plant Pre-Feasibility Study Report by USAID

[4] Board of Investment Pakistan, Investment Opportunities KP

[5] Development and Marketing of Gemstone and Other Mineral Resources of NWFP. A presentation to World Bank

[6] Muhammad Hanif (National Centre of Excellence in Geology), Muhammad Asif Khan (University of Peshawar), and Muhammad Haneef (Pakistan.Department of Geology, University of Peshawar) “Hydrocarbon Prospects in the Khyber Pakhtunkhwa: Future Strategies” Journal of Himalayan Earth Sciences, Peshawar vol. 45, no. 2, 2012, p. 46

Industry

The Sarhad Chamber of Commerce and Industry looks after the promotion of industry in the province. There are 3 Industrial Estates and 10 Small Industries Estates. The 3 main Industrial Estates are the Peshawar, Hattar, and Gadoon Amazai. Small Industries Estates are located in Peshawar, Mardan, Mansehra, Haripur, Kohat, Dera Ismail Khan, Bannu, and Charsadda. In addition, there are training centers associated with the industrial estates. In all, there are 2,584 registered small, medium, and large enterprises, of which 1,849 units are operational and 735[1] units have been discontinued.

The following table shows the type of industry and number of units of each industry in KP as per Development Statistics KP 2018-19:

Industry No. of Units Industry No. of Units
Adhesive Tape 06 Aluminum 07
Arms & Ammunition 32 Beverages 21
Biscuits & Sweets 41 Carpets 19
Cement 08 Cement Based 134
Ceramics 09 Chemicals 35
Cigarettes 12 Corn 02
Cosmetics 15 Cotton 09
Daal Processing 07 Detonators 02
Electrical Goods 13 Engineering 82
Fertilizers 02 Fiberglass 06
Flour Mills 193 Feed 08
Foam Industry 02 Furniture 61
Garments 04 Glasses 04
Gases 05 Hosiery 01
Cold Storage 16 Ice Factories 98
Leather 22 Marble & Chips 521
Safety Matches 18 Meat Processing 01
Metal Work+Crock 18 Mining 12
Motor Car Batteries 02 Woolen Textile 06
Packages 34 Paints 03
Paper & Board 15 Pet Lube 03
Pharmacy 80 Plastic & Rubber 107
Poultry Feed/farm 01 Polyester Acrylic 04
Preservation of Fruits 05 Printing Press 32
Rice 18 Silk 44
Soap 16 Spice Grinding 03
Sugar 08 Tea Packing 01
Telecommunication 02 Textile Loom Sec. 07
Textile Mills Sec. 16 Vegetable Ghee/oil 18
Wood 26 Total 1849

Table ‎1.10 KP Industries

[1] KP Development Statistics 2018-19

Handicrafts

KP is famous for its handicrafts, which include woodwork, chappal (sandal) making, woven shawls, stone jewelry, rugs, tapestries (mainly of Swat), handmade guns, intricately crafted brass and copper ware, pottery work, lacquer work, carpet making, textile, and embroidery.

Figure ‎1.15 KP Male Waistcoat with Traditional Chitrali Patti

Pakistani handicrafts appreciated at Shanghai - China Pakistan Economic Corridor

Figure ‎1.16 Handicrafts of Naran; KP

Figure ‎1.17 KP An Artisan at Work in a Swat Gala/ Festival

 

Figure ‎1.18 Rubab, the Traditional Musical Instrument of KP