The Impact of Climate Change on Pakistan's Agriculture sector: Evidence from OLS Regression & Co-integration

Abstract: According to Ministry of Finance of Pakistanin the year 2016-17, agriculture sector contributed to GDP 19.8% and employees about 42.3% a labor force in country. Pakistan has been ranked 7th  in climate change by theGlobal climate rise index in 2017, this rank indicates a great challenge for the Pakistan in agriculture sector due to further climate change in future.There are few gases such as greenhouse gases, CO2, carbon dioxide, methane and nitro oxide that mainly are responsible for changes to global climate. The climate change leads to change in rainfall, sea level and flow of water due to increase in temperature. There are many variables which may affect output of agriculture sector of Pakistan but in this study author mainly focused temperature and rainfall in terms of climate change.  This study is based on secondary data from year 2000 to 2015.The monthly data of temperature and rainfall has been collected from world economic indicator and 12 months’ data was divided for converting these variables into average. Agriculture GDP output collected from Economic Survey of Pakistan’s various annual issues.  Agriculture GDP output in terms of percentage, average rainfall mm andaverage temperature in centigradevariables have been used for the conclusion ofmain objective of this study.Data analyzed through various statistical techniques such as unit root test, OLS regression analysis and Johnson co-integration in E-view 7 version.The estimated results revealed that theaverage rainfall mm has negative and significant impact but average temperature has positive and insignificant impact on agriculture GDP output in terms of percentage in short run.