Bio-economy: towards financial stability

The idea behind bio-economy is to use locally available natural resources to create services and goods with greater market value

September 24, 2023


akistan is facing economic instability and climate change concerns. Amongst South Asian countries, it is currently the worst in terms of rising inflation and currency depreciation.

Agriculture is the backbone of the national economy. Developing the green resources can enhance the farmers’ capacity as well as enrich the domestic market. This will not only contribute to sustainable development but also create an opportunity to participate in international markets.

The mountainous areas of Pakistan are sparsely populated. Historically, the economic activities have centred on herding, land development, agriculture, fuel and value chain.

For centuries all trade was barter. Exchanges with neighbouring regions ensured livestock diversity.

Strengthening the agricultural value chains can support the cottage industry. Low taxes may provide stability and strengthen the ties with the cross-border trading partners. Barter trade can also help small-scale farmers in marginal areas and attract tourism. Eco-tourism and agri-tourism can revitalise conventional practices and provide economic sustainability.

Conserving traditional methods using advanced interventions can preserve the culture and livelihoods. Currently, about 60 percent of the area under vegetation is grassland. It can support the herders throughout the year. Strategic planning can help the herders enhance their capacity and productivity and achieve economic stability using advanced agricultural practices.

Revival of traditional practices calls for the establishment of bio-economic models that strike a balance between the conservation of resources and their economic exploitation. The core idea behind bio-economy is to use natural resources to create services and goods having greater market value. This strategy is in line with the growing understanding of the significance of sustainability in modern times.

Innovation is important in the context of bio-economy. It promotes the advancement of environmentally friendly practices, goods and technology that make the best use of the resources at hand. This contributes to not only preservation of cultural tradition but also economic development.

Bio-economy encourages cross-disciplinary approaches to problem-solving by facilitating collaboration amongst various industries. It fosters research and development that adheres to sustainability principles, guaranteeing that economic progress goes hand in hand with environmental stewardship and respect for cultural norms.

Use of bioeconomic models is a progressive strategy for managing resources. It acknowledges that the natural, cultural and economic resources are linked and that by increasing their potential sustainably, we can create a more resilient and prosperous future.

Innovation is important in the context of bio-economy. It promotes the advancement of environmentally beneficial practices, goods and technology that makes the best use of the resources at hand. This contributes to not only social well-being but also economic development.

A strategic framework for achieving this equilibrium is provided by bio-economic models. These entail a comprehensive view of resource management that considers social, environmental and cultural implications in addition to the economic ones.

Communities and industries can adopt such models to improve the use of resources while reducing the impact on the environment and local customs. Several western countries are currently revising their sustainability action plans and implementing bio-economic systems. Pakistan can learn from these economies.

Finland was the first country to implement bio-economic models for sustainable development. Its Bio-economy Strategy 2022–2035 strives to sustainably increase value addition. The strategy seeks to make Finland climate neutral by 2035 and to multiply the value addition in bio-economy in a way that is environmentally, socially and economically viable.

Bio-economy practices are implemented in a resource-conscious manner. The strategy backs Finland’s and the EU’s plans for transition to greener economies. In 2019, it contributed more than €25 billion, which is 12-13 percent of the value addition in the national economy.

Pakistan is rich in terms of its biological resource pool. However, its bio-economy is not considered a model for socio-economic development. Most agricultural products are traded in raw or primitive forms. The bio-economy has the potential for at least 1.6 percent contribution to the GDP. The estimate is based on data on livestock, agriculture, fisheries and non-timber forest products.

Agriculture sector’s performance was hit hard by 2022 floods. It grew by 1.55 percent after the previous year’s growth of 4.27 percent. In the first quarter of FY2023, a large part of farm land was under water. This disrupted the domestic supply chains.

The country requires an independent policy framework for bio-economy which is missing. Such initiatives can greatly contribute to dealing with the current economic crisis and help in achieving sustainable growth. The inclusion of tourism, agriculture, research and development, processing industries, value additions and organic industry can establish direct access to international markets.

Food security is the need of the hour. The policy makers must focus on developing a separate policy for bio-economy.

The writers are associated with the Sustainable Development Policy Institute. The article doesn’t necessarily represent the views of the organisation.