Status of Hybrid Seed Production in Pakistan and its Potential Role in Boosting up Agricultural Production

By

Muhammad Boota Sarwar

https://www.facebook.com/BootaSarwar Cell: 03003003405

CONTENTS Sr. Title No. 1 ABSTRACT 2 Chapter-I: Introduction Objectives of Hybridization Types of Hybrids Brief History of Hybrid Seed Production Benefits of Hybrid Seed Pre-Conditions for use of Hybrid Seeds World-wide use of Hybrid Seeds Use of Hybrid Seeds in Pakistan Hybrid Seed Production in Pakistan 3 Chapter-II: Importance of Agriculture in Pakistans Economy Target Crops for Hybrid Seed Production Seed Supplies Chapter-II: Expected Impact of use of Hybrid Seeds Chapter-III: Hybrid Seed Production: Challenges and Policy Options Available Resources Technical Resources Needed Cost Benefit Analysis Chapter-IV: Recommendations A Note on Private Seed Enterprise Development References Page No. 3 4 4 5 5 7 7 7 8 8 11 12 14 16 19 20 21 22 23 24 31

4 5

6 7 8

ABSTRACT The Study Paper is review of role of agricultural production in the economy of Pakistan and potential impact of use of hybrid seeds in boosting up yield and quality parameters of farm produce. Introduction to hybrid seed technology along with history of its evolution in USA the homeland of hybrid seeds - is given as background of the review. Although use of hybrid seeds in Pakistan is increasing day by day for raising crops like maize, sunflower, sorghum forage and for vegetable crops but there is no domestic hybrid seed production in the country except some rudimentary efforts in maize crop. The available human and technological resources in Pakistan have been analyzed and needed resources reviewed for evaluating feasibility of production of hybrid seeds in the country along with cost benefit prospects. It is concluded that over-dependence on heavy imports of hybrid seeds has put seed security of Pakistan on fragile grounds, sometimes imported seeds are not adapted to local environment and result in crop failures, cost of imported hybrid seeds is high and lot of foreign exchange is spent on seed imports. It is appropriate time that government may take appropriate measures and exercise policy options to encourage domestic production of hybrid seeds to meet increasing demand for hybrid seeds on low cost and to promote seed security, provide value-added diversification to the domestic seed industry and to materialize good potential for seed exports to target markets; and open job opportunities for thousands of professionals and skilled workers.

CHAPTER-I INTRODUCTION The mating or crossing of two plants or lines of dissimilar genotype are known as hybridization. In plants crossing is done by placing pollen grains from one genotype the male parent on to the stigma of flowers of the other genotype, the female parent. It is essential to prevent self-pollination as well as chance cross-pollination in the flowers of the female parent. The seeds as well as the progeny resulting from the hybridization are known as hybrid or F1. The progeny of F1, obtained by selfing or inter-mating of F1 plants and the subsequent generations are termed as segregating generations. The term cross is often used to denote the products of hybridization i.e., the F1 as well as the segregating generations. Objectives of Hybridization:

Combination Hybrids

The main aim of combination breeding is the combination of useful characters from two or more different genetic backgrounds into a single hybrid variety. In this approach, increase in the yield or improvement in quality of a hybrid variety is obtained by combining the yield or quality contributing traits e.g., tiller number, grains per spike, test weight etc., of the parent varieties. The parents must have sufficient intensity of the character(s) under combination.

Transgressive Hybrids

Transgressive breeding aims at improving yield or its contributing characters through transgressive combination. Transgressive combination is the production of plants in an F1 generation that are superior to both the parents for one or more characters.

Types of Hybrids:
1. Single Cross Hybrid: It is produced by crossing two inbred lines. 2. Double Cross Hybrid: It is produced by crossing two single

crosses. 3. Three-way Cross Hybrid: It is produced by crossing one inbred line with a single cross. Brief History of Hybrid Seed Production: Hybrid seed began with maize in the 1920s, and became extended to sunflower, vegetables and flowers; and more recently, rice and some forage crops. Hybrid seeds are produced from naturally out-breeding crops, from which inbred lines are produced by repeated selfpollination. The established inbred lines are crossed to produce first generations (F1) hybrid seeds. The hybrid seeds are prized because they produce uniform plants benefiting from the effect called heterosis (hybrid vigor). Heterosis can result in a large increase in yield over the inbred lines or comparable lines that are out-crossing. The precise basis of heterosis is still unclear, but epistasis and overdominance are thought to be involved. Epistasis is the interaction between different genes, and over-dominance is a condition where the heterozygotes (genes represented by two different versions) are superior to either homozygote (gene represented by the same versions). The F1 hybrid seed is heterozygous in many genes. Hybrid seed is planted to produce a crop that is harvested for use. Saving seed from the crop and planting it is undesirable because the two different versions of the genes in the F1 hybrid segregate out in the offspring, producing an extremely variable progeny. In other words, the superior qualities of the F1 hybrid will have all disappeared. The hybrid is obtained by crossing the inbred lines, which therefore, have to be separately maintained. Thus, only the 5

seed companies produce hybrid seeds, and farmers must buy those seeds from the company every year. Hybrid maize arose through the advocacy of a few influential Americans. Foremost among the advocates was Henry A. Wallace, who became vice-president of the United States. Wallace graduated from University with an agriculture degree, and studied statistics thereafter on his own. He later taught the subject at Iowa State University and used his knowledge to develop the first commercial hybrid maize. In 1926, he founded the Hi-Bred Corn company (now Pioneer Hi-Bred Seed Company, a subsidiary of Dupont Chemical Company), and later entered politics. He was made Secretary of Agriculture before being elected vice-president of the United States. Wallace was noted for his concern for the common man and envisioned hybrid corn as a means of providing bountiful food at low prices for the masses. The detailed history of hybrid corn and Wallace makes fascinating reading (4). The first corn hybrids were made by detasseling the plants of the maternal inbred-line by removing the male flowers so that the female flowers on the plants can only be fertilized by pollen produced from plants of another, male line. The detasseling operation used to be performed mainly by young girls employed during the summer months. Later on, male-sterile lines were developed that did not produce fertile male flowers or pollen. The male-sterile maternal lines were fertilized with paternal lines that allowed the hybrid seed to produce both male and female flowers. The male-sterile lines are most frequently altered in the mitochondrial genome, leading to the inhibition of male flower development. A number of such lines are now available (4). After successful experience of maize hybrids in enhancing yields to more than 100%, the use of hybrid seeds expanded to cover sunflower, sorghum, millets, vegetable crops, flowers and rice. It is 6

expected that hybrid wheat seed will be soon available for commercial cultivation in USA and other countries. Benefits of Hybrid Seed: 1. Higher yields with the range of 20% to 100% depending upon the characteristics of specific hybrid. 2. Uniform quality of the produce that helps in fetching better market price. 3. Uniform maturity of the crop providing easiness in machine or manual harvesting. 4. Generally better disease resistance; as it is easy to combine and incorporate two complementary sets of disease-resistant genes from parent inbred lines. 5. Provides inbuilt IPR protection to new varieties, as farmsaved seed is not fit for re-planting and farmers have to buy seed from the seed company each time. Pre-Conditions for use of Hybrid Seeds: Generally hybrids as well as all high yielding varieties require optimum conditions of crop growth and higher dosage of nutrients and irrigation for expression of their potential; the stress conditions may result in poor performance and disappointment. Marginal lands are not appropriate for planting hybrid seeds unless the specific hybrid is developed for specific stress conditions. World-wide use of Hybrid Seeds: The better performance of hybrid seeds over open-pollinated varieties is now an established fact and need not fresh evidence. Presently only hybrid seeds are used in all developed countries for growing corn and sunflower crops; whereas hybrids are widely used for raising sorghum-based forages, vegetable crops and flowers (15) & (16).

In India more than 60% certified cotton seed distributed is hybridcotton; similarly in Far-east and China hybrid rice seed is gaining ground; whereas in all developing countries farmers are shifting towards hybrid seeds year-by-year (14). Use of Hybrid Seeds in Pakistan: Farmers of Pakistan use only hybrid seeds for commercial production of grain-corn and sunflower crops and use of hybrid seeds for raising sorghum-based forages, vegetables and rice is increasing day-byday. As no hybrid seed is produced in the country therefore farmers totally depend on seed imports from various countries; and sometimes the imported seeds are not adapted to our local environment and give poor performance. The figures of import of hybrid seeds for the year 2005-06 are reproduced below to visualize scope of hybrid seed consumption. Table-1: Pakistan: Import of Hybrid Seeds (2005-06) Sr. Hybrid Seed Quantity Value No. Crop MT Million Rs 1 Corn 6,339 1,177 2 Rice 350 39 3 Sorghum, 3,944 112 Other grasses 4 Sunflower 1,606 358 5 Vegetables 7,360 1,527 (including OP) Total 19,599 3,213 Source: Federal Seed Certification & Registration Department (3) Hybrid Seed Production in Pakistan: Presently many Research Institutes of Federal and Provincial governments are working on breeding programs for development of new crop varieties but none has yet came up with any commercial hybrid variety of any crops. National Agriculture Research Center (NARC), Islamabad, Ayub Agriculture Research Institute (AARI), Faisalabad and Agriculture 8

Research Institute Turnab, Peshawar have done some research work on hybrid seed production in corn and sunflower crops but the same could not be sustained due to various reasons best known to these institutes. However the genetic resources for Cytoplasmic Male Sterility (CMS) are available with above referred institutes in respect of corn and sunflower crops. Similarly patchy technologies for commercial scale manual hybridization techniques in respect of corn, sorghum and cotton and for some vegetables are available for further development and standardization. Genetic resources for Cytoplasmic Male Sterility (CMS) are available with International Research Centers in respect of rice (IRRI) and pulses (ICRISAT); whereas technology for manual hybrid seed production of tomato is available with World Vegetable Research Center (AVRDC) and for rice with IRRI. During recent years few private seed companies have taken initiative for production of hybrid seeds of cotton, maize and sorghum-based forage hybrids; however the work is yet not comparable with hybrids of multinational seed companies. Development of hybrid seeds requires Research and Development work on two main aspects: 1. Development of compatible parent lines (male and female parents) and a system of maintaining these lines. 2. Development of commercially useable techniques for hybridization in the field for production of hybrid seed. As field hybridization technology is simple in respect of maize crop therefore it was good choice for local seed companies to start their efforts for production of hybrid seeds with maize crop. Agricultural Policies Research and Awareness Center (APRAC), Hyderabad has developed commercially useable technologies for production of hybrid seeds of cotton, okra and sunflower based upon chemical hybridization agents (CHA); simple manual technologies for

production of hybrid seeds of muskmelon and various gourds; and technology for production of seedless watermelons. Some technical resource persons are available in public sector and private sector organizations which can impart training to skilled labor engaged (or to be engaged) in manual hybrid seed production of various crops. Few multinational seed companies initiated hybrid seed production of maize sometime ago but suspended the work due to lack of Intellectual Property Rights protection in the country for their inbred lines; and it is expected that after enactment of Plant Breeders Rights Act multinationals will start hybrid seed production for some crops like maize, rice and sorghum (forage) (7).

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CHAPTER-II Importance of Agriculture in Pakistans Economy Agriculture is the mainstay of Pakistans economy. Nearly twenty-two percent of total output (GDP) and 44.8 percent of total employment is generated in agriculture. It also contributes substantially to Pakistans exports. Agriculture also contributes to growth as a supplier of raw materials to industry as well as market for industrial products. Not only that 44.8 percent of countrys work force is employed in agriculture but 65.9 percent of countrys population living in rural areas is directly or indirectly linked with agriculture for their livelihood. Whatever happens to agriculture is bound to affect not only the countrys growth performance but to a large segment of the countrys population as well. The performance of agriculture during the year 2005-06 has been weak. Against the target of 4.2 percent and last years achievement of 6.7 percent, overall agriculture grew by 2.5 percent in 2005-06 on the back of poor showing of major crops and forestry, and weaker performance of minor crops and fishery. Livestock has been the sole saving grace. Major corps, accounting for 35.2 percent of value added in agriculture, registered a decline of 3.6 percent as production of two of the four major crops, namely cotton and sugarcane has been significantly less than last year for a variety of reasons including excessive rains at the time of sowing, high temperature at flowering stage, late harvesting of wheat crop, strong base effect (cotton) and incidence of frost, damaging sugarcane crop in the month of January, 2006. The production of third major crop, wheat remained more or less at last years level at 21.7 million tons thereby registering a meager growth of 0.4 percent. The production of rice the fourth major crop has been the sole major crop which registered an impressive growth of 10.4 percent but failed to turn the negative growth in major crops to a positive one (5). 11

Minor crops, accounting for 12.3 percent of agricultural value added barely managed to register a positive growth of 1.6 percent in 200506 as against a growth of 3.0 percent last year. The performance of livestock, the single largest sector accounting for almost one half of agricultural value added, has been impressive as this sector grew by 8.0 percent on the back of substantial increase in the population of species, milk etc. The performance of fisheries has been poor as it grew by 1.9 percent only in 2005-06. Forestry has been registering negative growth for three consecutive years registering a negative growth of 9.7 percent in 2005-06 as against a negative growth of 30.4 percent (5). Target Crops for Hybrid Seed Production: i) Cotton: Cotton is not only an export-earning crop but also provides raw material to the local Textile Industries. It accounts for 8.6 percent of the value added in agriculture and about 1.9 percent to GDP. The area and production target for cotton crop during the current fiscal year were 3247 thousand hectares and 15.0 million bales, respectively. The crop was however, sown on the area of 3096 thousand hectares 4.6 percent less than the target and 3 percent less than last year (3193 thousand hectares). The production of cotton is estimated at 12.417 million bales for 2005-06, lower by 13 percent over the last years production of 14.265 million bales. Factors responsible for the decline in cotton production include: excessive rain at the time of sowing, high temperature at flowering stage, late wheat harvesting resulting in decline of area under the crop, and pest attack in some cotton growing areas of Punjab and Sindh. Area, production and yield of cotton for the last five years are given in Table 2 below. Table-2: Area, production and yield of cotton (1) Area Production Yield Year 000 % 000 % KGs % Hectares Change Bales Change Per Ha Change 2001-02 3116 +6.5 10613 -1.1 579 -7.2 2002-03 2794 -10.3 10211 -3.8 622 +7.4 12

2003-04 2004-05 2005-06 ii) Rice:

2989 3193 3096

+7.0 10048 +6.8 14265 -3.0 12417

-1.6 +42.0 -13.0

572 760 682

-8.0 +32.9 -10.3

Rice is an important food cash crop. It is also one of the main export items of the country. It accounts for 6.1 percent of the total value added in agriculture and 1.3 percent to GDP. Area and production target of rice for the year 2005-06 were set at 2533 thousand hectares and 5000 thousand tons, respectively. Area sown for rice is estimated at 2620 thousand hectares 3.4 percent higher than the target and 4 percent higher than last year. The size of the crop is estimated at 5547 thousand tons almost 10.4 percent higher than last year and 10.9 percent higher than the original target. The higher production is due to favorable weather condition. Area, production and yield of rice for the last five years are given in Table 3. Table-3: Area, production and yield of cotton (1) Area Production Yield Year 000 % 000 % KGs % Hectares Change Tons Change Per Ha Change 2001-02 2114 -11.1 3882 -19.2 1836 -9.1 2002-03 2225 +5.2 4478 +15.3 2013 +0.6 2003-04 2461 +10.6 4848 +8.3 1970 -2.1 2004-05 2519 +2.3 5025 +3.6 1995 +1.2 2005-06 2620 +4.0 5547 +10.4 2117 +6.1 iii) Other Major Cereals: The maize, jowar and bajra are other major cereal crops the production of which can be improved through use of hybrid seeds. The area and production are of these crops is given in Table 4. Table-4: Area and production of other cereals (1) 2004-05 2005-06 Crop Area 000 Production Area 000 Production % Change s Hectares 000 Tons Hectares 000 Tons in production 13

Maiz e Bajra Jowa r

982 343 308

2797 193 186

1022 438 250

3560 221 153

+27.3 +14.5 -17.7

iv) Oilseeds: The major oilseed crops include rapeseed/mustard, sunflower and canola etc. The total availability of edible oils in 2004-05 was 2.764 million tons. Local production stood at 0.857 million tons which accounts for 31 percent of total availability while the remaining 69 percent was made available through imports. During 2005-06 (July to March) local production of edible oil is provisionally estimated at 0.809 million tons. During the same period 1.269 million tons of edible oil was imported and 0.216 million tons edible oil was recovered from imported oilseeds. The total availability of edible oil from all sources amounted to 2.294 million tons during (July to March) 2005-06 (provisional estimates). The production of oilseed crops during 200405 and 2005-06 is given in the Table 5. Table-5: Area and Production of Major Oilseed Crops (1) 2004-05 2005-06 Area Production Area Production 000 Acres Seed Oil 000 Acres Seed Oil Crop
(000 Tons) (000 Tons) (000 Tons)

(000 Tons)

Rapeseed/ Mustard Sunflower Canola

601 780 288

203 569 144

64 205 52

578 850 323

188 595 162

59 214 58

Seed Supplies: Certified seed plays a pivotal role in boosting agricultural production both in market oriented and subsistence farming. Certified seed in 14

Pakistan is limited to wheat, cotton and paddy as major crops besides maize, gram, pulses fodder and oilseeds as well as minor crops. The Federal Seed Certification & Registration Department regulates quality during the flow of seed from the breeder to the growers. The Department performs its functions through seventeen Seed Testing Laboratories and Field Offices, established in various ecological zones of the country. To provide certified crop seeds to the growers from the public sector, the Seed Corporation in the Punjab and Sindh and the Departments of Agriculture in Balochistan and NWFP have been entrusted the task of seed production, processing and marketing. Government has permitted about 550 National Seed Companies for production and marketing of certified seeds. Their seed production activities are mostly confined to the above-mentioned major crops. Private seed sector has not developed any research and development program. They multiply varieties, developed by public sector. Research Institutes are mostly maintained by Foundation Seed Cell of Punjab Seed Corporation. Multinational seed companies mostly import Hybrid corn, sunflower and Forages seed. During (July-March, 2005-06) 228.1 thousand tons of improved seed was procured and 202 thousand tons of improved seed was distributed, while 190.6 thousand tons of improved seed was distributed during the same period of the year 2004-05 (5).

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CHAPTER-III Expected Impact of use of Hybrid Seeds Farmers of Pakistan are already using exclusively the hybrids seeds for commercial production of maize and sunflower crops; whereas use of hybrid seeds is becoming popular among the growers of sorghum-based forages, vegetables and rice crop. Growers are now using some quantity of cotton hybrids. So far no hybrid has been introduced for canola crop. Farmers observed that the traditional non-hybrid varieties of maize produce 30-40 maunds grain per acre under good cultural conditions whereas hybrid maize yields range from 80 to 110 maunds grain per acre; therefore all the commercial growers in Pakistan have shifted towards use of hybrid seeds imported by multinational seed companies. Similarly the sunflower growers have observed that traditional nonhybrid sunflower varieties provide yield in the range of 12-18 maunds per acre whereas yield range of hybrid seeds of sunflower is between 30 to 35 maunds per acre; so farmers now exclusively use hybrid seeds for commercial production of sunflower crop. The hybrid seeds of sunflower are imported by multinational seed companies as well as by the seed importers / traders. The hybrid cotton seed is presently produced by only one private seed company of Multan area; that is produced through manual hybridization by women labor trained for the job; as is the common practice in India, the bulk producer of hybrid cotton seed in the world. The experiments on farmers fields and on Punjab Seed Corporation 16

farm at Khanewal revealed yield enhancement in the range of 15 to 25% besides some improvement in fiber characteristics. The quantity of cotton hybrid seed produced annually is small and the company instead of distributing F1 hybrid seed among the farmers has moved to the production and distribution of F2 progeny (next generation) of the hybrid seed which is inferior in performance to the F1 hybrid seed. The hybrid seeds of coarse rice, mainly imported from China, have been introduced in Sindh province and growers in Shikarpur district have claimed yields in the range of 90-100 maunds per acre as compared to yields of IRRI-6 which is in the range of 60-70 maunds per acre. The hybrid seeds of sorghum-based forages like sudax, Sudan grass, hybrid sorghum etc have been introduced in Punjab and Sindh provinces and have become popular among the growers due to higher yields of forage in the range of 30-50% as compared with nonhybrid sorghum varieties. Vegetable growers are now well accustomed with use of hybrid seeds for raising bottle-gourd, eggplant, cabbage, cauliflower, carrot, chili, sweet pepper, cucumber, coriander, lettuce, melon, watermelon, okra, onion, pumpkin, radish, ridge gourd, squash, sponge gourd, turnip, tomato and marrow; mainly due to their higher yields and uniform quality. The vegetable farmers are gradually shifting towards use of hybrid seeds of vegetables which all are imported by seed importers / traders. Keeping in view the experience of farmers the potential impact on the yield increase and quality improvement is estimated in following ranges: 1. 2. 3. 4. 5. 6. 7. Maize: Sunflower: Cotton: Rice (coarse): Sorghum (forage): Sorghum (grain): Bajra (grain): 100% 100% 20-25% 25-30% 20-30% 25-30% 20-30% 17

8. Vegetables:

30-50%

The value addition through expansion of hybrid seed industry is expected in following terms: 1. Value addition through partial substitution of hybrid seed imports: Rs. 2,000 million. 2. Value addition through meeting yearly increase in domestic demand of hybrid seeds during next 5 years: Rs. 1,200 million. 3. Value addition through exports of hybrid seeds: Rs. 800 million. The socio-economic benefits through new job creation as a result in expansion of hybrid seed industry is expected to the tune of 500 professionals and 20,000 skilled workers engaged hybrid seed production along with additional incomes to 2,000 small and medium size farmers. Introduction of commercial hybrid seed production technology will result in expansion of hybrid seed industry in Pakistan and provide basis for joint ventures and direct foreign investment in seed sector; and the knowledge-based, market-driven and competitive seed industry will be able to initiate export of hybrid seeds of various crops, especially the hybrid seeds of vegetable crops, to the potential seed markets of South Asia, Central Asia and Middle East including North Africa.

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CHAPTER-IV Hybrid Seed Production: Challenges and Policy Options The farmers have already shifted to use of hybrid seeds for raising maize, sunflower and sorghum forages; whereas vegetable hybrids are becoming popular among more and more vegetable growers every year. The hybrid seeds of cotton and rice have taken ground and their use is expected to increase in coming years. However as most of the hybrid seeds are imported from other countries so this situation poses following concerns: 1. High cost of hybrid seeds which is mainly due to higher production cost in developed countries and high logistic expenses. 2. The country has to pay heavy amounts in foreign exchange for increasing imports of hybrid seeds. 3. Over-dependence on imported seed supplies puts seed security and food security of the country on fragile grounds. Any disturbance in seed supplies or crop failure in seed originating country will seriously affect crop production in Pakistan. 4. Some times the imported hybrid seeds are not adapted to our local environmental conditions and cause serious damages to the farmers due to crop failures. Therefore it is necessary, in the national interest and in the interest of farmers, to introduce and initiate local production of various hybrid seeds in the country to mitigate above referred concerns and benefit from value-added diversification of domestic seed industry. 19

Various benefits of investment in domestic seed industry have been already discussed in respect of seed security, reasonable cost of hybrid seeds, value-added diversification of domestic seed industry and good potential for seed exports. Available Resources: Following technological and enabling resources are available in Pakistan to embark on domestic hybrid seed production; 1. Wide range of indigenous and introduced elite genetic resources are available with various research institutes, on farm fields and in the seed markets; to initiate breeding programs for developing inbred lines to produce commercial scale hybrid seeds of various crops. 2. The genetic resources in respect of incorporating Cytoplasmic Male Sterility (CMS) and restoration of fertility are available at relevant research institutes in respect of maize and sunflower crops; for utilizing in hybrid seed production programs. 3. The technologies for manual hybridization in respect of maize, sorghum, tomato, eggplant, chili and various cucurbits are available in the country, with public research institutes and private seed organizations. 4. The technologies based upon chemical hybridization agents (CHA) are available with APRAC, Hyderabad in respect of cotton, okra and sunflower crops; for utilizing in hybrid seed production programs. 5. Required human resources are available in the country for training of skilled workers in respect of field or greenhouse manual hybridization work on commercial scale. 6. Some facilities for seed processing, grading and packing of hybrid seeds are already available in the country.

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7. Facilities for screening of inbred lines in respect of resistance to diseases are available at various research institutes; for selection of appropriate inbred lines for hybrid seed production. 8. Professional plant breeders are available in the country for initiating breeding programs for development of elite parent inbred lines and maintenance system. 9. There is no shortage of skilled labor force in the country for further training in commercial scale manual or chemical hybridization work. 10. Draft Plant Breeders Rights Bill has been finalized by the Ministry of Food, Agriculture and Livestock, Government of Pakistan and submitted to the cabinet for further enactment process. The enactment of PBR will create enabling environment for protection of investment of seed companies in developing new plant varieties and hybrids. Technical Resources needed: 1. Elite genetic resources of inbred lines for developing commercial hybrids are presently not available in the country. The resources need initially out-sourcing and further expansion through domestic breeding work. 2. Genetic resources for in respect of incorporating Cytoplasmic Male Sterility (CMS) and restoration of fertility are not available in the country except for maize and sunflower crops. Such resources need initially out-sourcing and further expansion through domestic breeding work. 3. Standardization and screening of chemical hybridization agents (CHA) is needed to select appropriate technologies for commercial scale utilization in hybrid seed production programs. 4. Advance technical equipments are needed to process wetseeds and non free flowing seeds; as well as advance 21

machinery is needed for seed conditioning and packaging and for establishing managed environment facilities. 5. Government policy support is needed to encourage investment in high-tech and value-added hybrid seed industry. Cost Benefit Analysis: The economic and financial analysis presented in approved project of Ministry of Food, Agriculture and Livestock, Government of Pakistan entitled Establishment of Participatory Unit for Participatory Vegetable Seed and Nursery Production Program in respect of hybrid vegetable seed production show 30-40% profit on 3-4 year investment; the period required for commercialization of new technologies (3). Similarly the working of multinationals working in developed countries as well seed companies working in China, India and Kenya show similar trends of profit margin on investment in hybrid seed production business (14) & (6). The domestic private seed companies which have initiated hybrid seed production of maize crop have communicated 25-30% net profit in this business; although they do not disclose the actual figures of extent of profits. The economic and financial analysis in respect of individual crop for production of hybrid seeds can be worked out if required for developing feasibility studies of specific seed business. The size of investment required to initiate commercial production of any hybrid seed varies between Rs. 10-30 million keeping in view the nature of crop species; however further addition of crop species lower the business launching cost. The above referred project of MINFAL provides useful information in this respect (3).

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CHAPTER-IV

Recommendations 1. It is appropriate to suggest that keeping in view the concerns in respect of seed supply system and the benefits of initiating domestic hybrid seed production programs, SMEDA and MINFAL may collaborate in developing a scheme for promoting hybrid seed production in Pakistan. 2. Government of Pakistan, through Ministry of Food, Agriculture and Livestock or Board of Investment may notify relaxed terms of investment for encouraging domestic Hybrid Seed Industry. 3. A comprehensive PC-I may be developed by SMEDA for making breakthrough in development of domestic Hybrid Seed Business; based upon survey and feasibility studied through PC-II provision.

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A Note on Private Seed Enterprise Development Government investment strategies should support the development of private seed enterprises to make quality seeds available to small farmers. This requires a long-term outlook, recognizing that the first steps will likely be taken with higher-value seed crops (such as hybrids), and the strengthening of various elements of the seed system (which may be pursued by independent enterprises or combined in a single firm). Support must enhance development of competitive markets. Seed enterprise development includes attention to the policy environment, support to public sector plant breeding, seed regulatory reform, and strengthening input and output marketing capacities. Seed provision is at an important crossroads in many developing countries. Donor support to public seed enterprises has diminished because these have not been efficient. Strategies for supporting the private seed sector are still evolving. As a result, many farmers have little access to commercial seed, and this has restricted the choice of crops and varieties. Since benefits of modern plant breeding can only reach farmers through an efficient seed system, there is an urgent need to develop the private seed sector. Developing Private Seed Enterprises: Public seed enterprises have introduced new crop varieties and have been important in development efforts, but it is increasingly difficult to defend their continued support, as seed production and marketing are inherently private sector activities. Public enterprises generally lack the incentives that a competitive private sector can offer to respond to changing demands or new markets or to increase industry efficiency.

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An emerging private seed industry faces many obstacles; some relating to the general business climate and others specific to the seed industry Public sector interventions should be market-based to the extent possible, using competitive grants, matching grants, and vouchers. Public-private cooperation can realize synergies in policy preparation and implementation, developing new varieties, and developing efficient and effective marketing outlets. Public investment can be justified because of the large spillover benefits to society. The seed sector comprises the following different activities with varying opportunities for private and public investment. Plant breeding. Seed enterprises require access to new varieties. Although private plant breeding capacity is increasing, many crops will depend on public sector breeding programs for the foreseeable future. Public plant breeding organizations must have adequate links to private seed distribution mechanisms. Source seed production. Production of commercial seed entails multiplication of several generations of source seed (for example, breeder seed, and foundation seed). Enterprises managing commercial seed multiplication may or may not have capacity to produce and maintain source seed. Seed multiplication. Source seed is multiplied to produce commercial seed. In most cases, a seed enterprise supervises contract farmers to multiply seed. Quality control. The multiplication process must ensure both the genetic purity and physical quality of the seed. Quality control systems may range from managing a mandatory seed certification scheme to only requiring that seed be truthfully labeled. Responsibility for quality control is now shifting to seed enterprises. Seed conditioning. Seed must be cleaned, dried, treated, and stored before sale. This requires specialized equipment and (for certain crops) considerable storage capacity. Seed marketing. Seed is sold through input dealers, requiring distribution capacity through a competent, independent network of wholesalers and retailers. 25

These components of seed provision may all be managed by a single firm or in the hands of various linked enterprises. Any investment in seed enterprise development must examine the options of supporting smaller, specialized operations versus larger, integrated firms with the choice depending in large part on the resources and capacities available and the stage of evolution of the seed industry (9). Benefits: The potential benefits of investing in seed enterprise development will depend on whether investment is for varieties or for seed. The former represents the genetic gains to be derived from access to new products of plant breeding, while the latter represents gains from the physical quality of commercial seed. The two are different, and commonly used phrases such as improved seed tend to confuse the issue. Estimating the gains from access to new varieties may be relatively straightforward, if data are available on the yield (or other) advantages of new varieties over those currently in farmers fields. Investments in varietal development have no payoff unless the new varieties reach farmers and, in many cases, absence of a commercial seed system results in new varieties not being used. Farmer-tofarmer seed diffusion helps spread varieties, but is rarely sufficient. Once in their hands, farmers can often maintain new varieties by saving their own seed, in some cases maintaining varieties for many years with little loss in purity or performance. In other cases (especially for crops subject to significant cross-pollination) farmers need access to new seed supplies more frequently, and in the case of hybrids, should purchase fresh seed each year and commercial seed may offer few advantages (8). Policy and Implementation Issues: VARIETAL DEVELOPMENT: Although private plant breeding is developing for certain crops, public research systems will continue to play an important role, requiring support to strengthen scientific capacities and define respective 26

responsibilities between the public and private sectors. In most cases the public sector will need to maintain breeder seed of its varieties, establish an efficient system to provide commercial enterprises access to this seed, and enforce a system of plant variety protection (ensuring access royalties).

NATIONAL SEED REGULATORY FRAMEWORKS: Systems for variety release and registration must be equally accessible for private and public plant breeders, and must allow for rapid assessment and release. Harmonization of national release procedures across a region allows access to new varieties across a number of countries rather than being delayed by individual and idiosyncratic country reviews. Seed certification and quality control procedures are generally managed by a public sector certifying agency. Consideration should be given to shifting these functions by licensing private seed companies to do their own certification and testing and by enforcing truthful labeling laws (8). NEGLECTED AREAS/CROPS: Given that farmers save seed from one season to the next, one major challenge for seed enterprises is to ensure repeat sales. The emergence of a private seed industry is almost always based on hybrid seed (that must be replaced each year to maintain its yield advantage), or on seeds that farmers find difficult to save (such as vegetables). Seed of many crops (particularly those grown by isolated and/or less commercially oriented farmers) is less likely to be included in a nascent private seed sector. This does not, however, argue for continued public seed production, as public seed enterprises have also failed to reach this market. Instead, appropriate incentives for seed production at local, informal, small scale can encourage enterprises to serve these markets before they are gradually included in a growing conventional private seed industry. GENDER:

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Because women have responsibility for seed selection and preservation in many traditional farming systems, commercial seed production presents good opportunities for including women as contract farmers and marketers as well as employees (10). Lessons Learned: START-UP CROPS/VARIETIES: Commercial seed production must begin with products that have a high probability of repeat sales: hybrid seed, seeds that are difficult to manage on-farm, or seed of crops that have a market premium for quality. Although commercial seed production has limited economies of scale, it does offer economies of scope, so that once a production and marketing system is in place for more profitable seed crops, other types of seed can be added. Mini-Pack Distribution: The production and sale of small packs (mini-packs) of seed of new varieties can provide additional business to emerging seed enterprises, help to develop a market for a wider range of seed types, and support the diffusion of new crop varieties. Such schemes often attract outside support from donors interested in promoting use of new seed or responding to emergency situations characterized by loss of seed stocks (for example droughts, conflicts). There have been a number of successes with contracting seed enterprises to package seed in small quantities that are attractive and affordable. Distributing these through rural input suppliers helps develop markets for quality seed. Where there are noncommercial elements in such mini-pack schemes, quality control and strategies for phase-out of subsidies are particularly important (6). SEED ENTREPRENEURS: Seed provision entails a range of skills (plant breeding, seed production, marketing) that no one person is likely to possess. Seed businesses tend to be initiated by people already with some experience: plant breeders (establishing their own seed businesses, privatizing their plant breeding skills and developing marketing expertise); contract growers for seed companies with knowledge of 28

seed multiplication; seed company production agronomists; and the commercial sector, either people involved in the grain trade or input marketing (12). COMMUNITY SEED PRODUCTION: Many development projects have used community-level seed production as the starting point for commercial seed development. Results have been disappointing with little commercial sustainability. Reasons for lack of success are twofold: inattention to transaction costs (for making contracts for source seed, ensuring quality control, and obtaining information) and a lack of experience and resources for marketing. Community-level seed projects need more appropriate goals to be successful, such as testing and disseminating new varieties, developing farmers experimentation capacities, and forming better links between farmers and researchers (11). EMERGENCY SEED PROGRAMS: Donors and governments have often been involved in the free distribution of seed, in the context of emergencies related to drought or civil unrest. Even in these cases, externally provided seed is not always a priority, but many of these programs still acquire a semipermanent status based on ideas of support to agriculture or introduction of new technology. Such interventions are difficult to stop, but must be designed to do as little damage as possible to the prospects for seed enterprise development. This usually means using local seed enterprises, paying attention to farmer feedback and demand for varieties, and distributing the seed through retail outlets (using vouchers). If this is not done, it is very difficult for the commercial seed sector to develop, and farmers acquire the idea that seed is an input (often of low quality) that is given away (6). Recommendations for Practitioners: Key public sector investments include sector analysis, development of sector strategies, policy reform, establishing the regulatory framework and capacity building. Donor support for seed enterprise development requires careful assessment of options, with the most useful assistance often coming not from large projects, but from well29

targeted support to specific policy initiatives or to lowering transaction costs for commercial development (13. This requires donors to have capacity for sustained monitoring of institutional development. Other investment considerations include: Investments in building capacity of private enterprises and associations often through matching grantsto develop of new varieties and retail systems. Attention to the advantages of industrial clusters, and promoting the sharing of knowledge, facilities, and personnel. Emerging seed enterprises that can profit from technical and organizational support and links with enterprises in other countries. Support to regulatory harmonization across a region which allows resources to be used more effectively and have broader regional impact. Public agricultural research institutes efforts to become more supportive of private seed sector development. Support for the development of rural input retailing and produce marketing which is essential for promoting private seed sector development.

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References 1. Agricultural Statistics of Pakistan, 2004-05; Ministry of Food, Agriculture & Livestock, Government of Pakistan. 2. A lmekinders, C., and N. P. Louwaars, 1999: Farmers Seed Production, New Approaches and Practices. London: Intermediate Technology Publications. 3. Boota, Muhammad: Establishment of Participatory Unit for Participatory Vegetable Seed and Nursery Production Program an approved project of Ministry of Food, Agriculture and Livestock, Government of Pakistan, 2007. 4. Cummins, Joe Prof. and Dr. Mae-Wan Ho: Hybrid Seed, 2005; published by Institute of Science in Society, UK. 5. Economic Survey of Pakistan, 2005-06; Ministry of Finance, Government of Pakistan. 6. Gadwal, V. R: The Indian Seed Industry, Its History, Current Status and Future; CURRENT SCIENCE, VOL. 84, NO. 3, 10 FEBRUARY 2003 7. Hussain, A. Syed and A. R. Bhutta: Seed Industry of Pakistan 2003; Federal Seed Certification & Registration Department, Government of Pakistan, Islamabad. 8. L ouwaars, N. P., ed. 2002: Seed Policy, Legislation and Law: Narrowing a Wider Focus. Binghamton, N.Y.: Food Products Press. 9. Rural Industries Research and Development Corporation, Australia: Asian Vegetable Seed Industry A Situation Assessment, 2003. 31

10. T ripp, R. 2000: Strategies for Seed System Development in Sub-Saharan Africa: A study of Kenya, Malawi, Zambia, and Zimbabwe. ICRISAT Working Paper Series: 2- Bulawayo, Zimbabwe: ICRISAT. 11. T ripp, R. 2001: Seed Provision and Agricultural Development: the Institutions of Rural Development. Oxford: James Currey. 12. T ripp, R. and D. Byerlee, 2000: Public Plant Breeding in an Era of Privatization. Natural Resource Perspectives 57. ODI, London. 13. T ripp, R. and S. Pal. 2001: The Private Delivery of Public Crop Varieties: Rice in Andhra Pradesh. World Development 29 (1): 103-117. 14. USDA Foreign Agriculture Service, GAIN Report: China, Planting Seeds, 2004. 15. USDA Foreign Agriculture Service, GAIN Report: Russian Federation, Planting Seeds Annual Report, 2004. 16. US Department of Agriculture (USDA): The Seed Industry in US Agriculture, 2004.

Muhammad Boota Sarwar Director Federal Seed Certification & Registration Department Islamabad.

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