Although most developing countries are agrarian in nature and despite the dominant position occupied by the agriculture sector in their traditional economies, many have consistently failed to pay adequate attention to agriculture and rural development. It is widely believed that the governments in these countries intervene in the agriculture sector in many ways, to serve political interests and other non-publicly beneficial ends. This can take the form of: buying crops from farmers at less than the world prices and then selling it to relatively better-off urban dwellers. In this way, resources are transferred out of agriculture which is the main source of livelihood for vast rural and urban populations. To compensate farmers, some governments provide subsidies -- such as credit, fertilisers, seeds, etc -- which are mostly misused and misdirected and benefit mostly landlords. These government intervention policies result in a large waste of resources. This has often led to a stagnant agriculture sector; that, in turn, has resulted in a large shortfall of domestic food production, balance of payment crises and political instability. Pressured by both the World Bank and IMF, there are moves towards liberalisation of agricultural markets in order to gain maximum efficiency. This thesis examines Paddy and Rice Marketing in Pakistan as an example of agricultural marketing with specific emphasis on whether or not is should be liberalised. Going beyond but including the limited published evidence on the subject, empirical data were collected in Pakistan to address the issue. Four and a half months of field work in Pakistan was carried out on various organisations involved in rice marketing, using semi-structured interviews. It was found that in Pakistan, the government uses a mixture of subsidies and taxes in the agriculture sector. These subsidies are misused and misdirected and overall the agriculture sector is taxed to serve urban interests.