ISLAMABAD: Minister for Finance, Senator Mohammad Ishaq Dar said on Tuesday that in order to achieve broad-based economic development, the government had been focusing on agriculture, infrastructure, energy, and telecommunication sectors.
“It is our belief that advancements in these sectors can propel the country to achieve an economic growth rate of around 7 percent by 2017-18”, Dar said while addressing a two-day International Conference on “Innovative Agriculture Financing” here.
The Conference was jointly organized by State Bank of Pakistan (SBP) and Food and Agriculture Organization of United Nations (FAO) here.
The Conference aimed to discuss innovative strategies and solutions to increase outreach of agriculture credit to small-scale farmers, and also highlighted opportunities for corporate farming and agriculture-food enterprise.
Ishaq Dar highlighted that the Government places high priority to the development of country’s agriculture sector due to its strong linkages with other sectors of economy, and its high significance in ensuring food security, reducing poverty, and generating widespread prosperity. The government is taking measures to increase agriculture production and infrastructure, ensure food security, and promote pro-poor agricultural growth.
These measures will help to improve production yields, introduce modern farm-mechanization, increase better market access, and integrate farming with diverse markets through value chains to ensure that the benefits are passed down to farmers, he added.
Finance Minister said that the Government was fully committed in providing an enabling environment to the financial sector for financing to agriculture sector through innovative and scalable products.
“I am personally involved with the efforts of SBP to work in collaboration with SECP, Mercantile Exchange, and other stakeholders for formulating a strategy to develop a framework for the development of warehouse receipt financing system in Pakistan”, he said.
In this regard, he said he had launched the Financial Innovation Challenge Fund (FICF) round on innovative agricultural finance at Islamabad about a year back.
“It is indeed heartening to witness that the challenge has successfully led to launch of various initiatives including pilot on Warehouse Receipt Financing (WHR), value chain financing, Islamic agri-finance models, and automation of credit appraisal processes”, he remarked.
In particular, he said WHR financing will facilitate banks in collateralization of agricultural produce for provision of financial services to small farmers.
“On the other hand, it will help in creating price transparency and encourage private sector investment in the commodity sector. These will help in revamping the obsolete agri commodity management system prevailing in our country, necessary for ensuring food security and reducing commodity waste. On the successful completion of the pilot, I congratulate SBP and stakeholders”, he remarked.
Sikandar Hayat Khan Bosan, Minister for National Food Security and Research, who co-chaired the inaugural session, while appreciating the steps taken by SBP to promote agriculture financing, stated that focus on sustainable agriculture is imperative to meet the increasing food demand of a growing population worldwide.
He emphasized that the large scale prosperity cannot be accomplished without channelizing resources including financial services, for the benefit of smallholder farmers.
He hoped that innovative thinking and knowledge exchange through such forums can help in bringing working solutions to long-held issues of farmers’ low access to financing.
Governor SBP Ashraf Mahmood Wathra, in his address shared SBP’s policy framework for enhancing the flow of financial services to rural agriculture sector.
Wathra, while asserting the importance of agriculture for the country, mentioned that access to finance is critical to rural-agriculture developments.
He said that changing times are giving birth to newer financial-inclusion challenges which demand a divorce from conventional and traditional approaches and a marriage with newer, better and more innovative ways of doing business.
Earlier, Saeed Ahmad, Deputy Governor, State Bank of Pakistan thanked the Chair and welcomed the panelists and participants for attending the conference.
The conference was attended by over 350 participants including General-Secretary-Asia-Pacific Rural Agriculture Credit Association (APRACA) Mr. Chamnong Siriwongyotha, CEOs/Presidents/Executives of banks, MFBs, Representatives of Farmers & Business Associations, and Academia.
