Leading Issues in the Economy of Pakistan: Agenda for Reforms from cotton. This explains the large-scale substitution of the cotton crop by sugarcane, thereby converting Pakistan from being a cotton exporter to importer. Fortunately, the price support mechanism has been reintroduced recently for cotton. It should now be dropped for sugarcane. iii) The rise in procurement/ support prices has not kept pace with the increase in input costs. With 2010-11 as the base year of the output price index to input price index with a value of 100 it now stands at 87.80. Therefore, the terms of trade for agriculture have worsened by almost 13 percent leading thereby to a significant loss of profitabil­ity to farmers and a fall in yields. The issue currently is the setting of the wheat procurement price for the crop season, especially in the wake of the flood devastation which could delay the sowing of the crop. The latest c.i.f. import price of wheat in September 2022 is Rs 3593 per maund. Therefore, the recommended price of procurement is Rs 3600 per maund. This will increase the price by over 60 percent in relation to last season’s price of, and will have to be backed up by a sizeable subsidy to PASSCO. However, it is essential in view of the likelihood of a global and domestic food shortage. iv) The rise in input prices has been driven by the jump in fertilizer prices. During 2021-22, the price of urea has gone up by 10 percent and that of DAP by as much as 74 percent. There is need for introducing a cross subsidy for DAP by raising somewhat the conces­sional sales tax on urea. All efforts have to be made to raise the growth rate of the agricultural sector from 2.8 percent during the last decade to 4 percent once again. 17.4 Underinvestment in Human Capital Pakistan has for the first time fallen into the category of countries with‘ low human development’ in 2021-22 as highlighted in Chapter 17. According to the latest UNDP Global Human Development Report. The HDI of Pakistan is 0.544 and it is ranked 161 st out of 191 countries. As compared to this both India and Bangladesh are in the category of ‘medium human development’. India has a HDI of 0.633 and is ranked 132 nd , while the HDI of Bangladesh is even higher at 0.661 and it is ranked 129 th . The basic reasons for the low HDI lie especially in education. The mean years of schooling in Pakistan is only 4.5 years of the adult population as compared to 7.4 years in Bangladesh and 6.7 years in India. Also, the life expectancy is 63.8 years in Pakistan and 65.8 years in India, and 70.6 years in Bangladesh. Government expenditure on education is low at 1.8 percent of the GDP in 2020-21 and has fallen from 2 percent of the GDP in 2015-16 as shown in Table 17.3. The corresponding estimate, for example, for India of 4 percent of the GDP. Further, the share in expenditure of 176