FAISALABAD. Focused credit policies on value addition coupled with maximization of per acer yield for small land holders is imperative to make the profession of tillage profitable particularly in the backdrop of fast squeeze cultivable land around main cities of the Punjab province, said Engineer Ahmed Hassan Vice President Faisalabad Chamber of Commerce and Industry (FCCI).
He was talking to media persons here today after attending a review meeting of the agriculture credit advisory committee of the state bank of Pakistan in Multan.
He said that predominantly Pakistan is an agrarian economy which is included among top 10 countries producing cotton, rice, sugarcane, maize, milk, fresh vegetables and many exotic varieties of fruits. He said that despite of this ecological diversity edge, we bitterly failed to add value into these important crops which has resulted in eroding the financial viability of small landholders in addition to encouraging migration from rural to the urban centers.
Continuing, he said that agriculture sector has played an important role in the development of national economy since independence. “This sector had contributed around 19.8% towards the national GDP in 2015 in addition to providing employment to 42.3% labor force of Pakistan”, he said and added that despite of the economic importance of this sector, agriculture in Pakistan continues to face many problems including low crop yield, high wastages, low value addition due to the use of primitive technology and farming methods.
He suggested that our banking sector needs to formulate agriculture finance policies with the aim of achieving higher value addition and an increased use of modern technology and practices. He further said that special financial services and incentives need to be given to those farmers and entrepreneurs who are aiming to improve the technology being used in local farms and are inclined to focus on improving their efficiency in the given circumstances.
“Our banking sector should give out soft loans and credit to entrepreneurs looking to setup model farms through technology transfer from other countries like Turkey and China”, he e said and added that there are many opportunities for our agriculture sector in CPEC, and that banking sector should also design special policies to promote joint ventures between Pakistani and Chinese entrepreneurs in the agriculture sector.
He also underlined the need to address the bias in our agriculture finance policies towards small landholders and those who do not own any land. He further said that banking sector should look after the marginalized farmers and analyze their financial constraints and needs in particular.
He said that an analysis needs to be carried out regarding the socio economic factors which prevent such farmers from gaining access to the credit lines and based on these analysis banks would be able to design better products for these farmers.
He further said that the designing of better agriculture finance policies will not only help us to improve our agriculture production and exports but also discourage migration from rural to urban centers that have limited resources of employments, health, education and accommodation facilities etc.
