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Farm productivity of Africa provides scope for Asian investment: Pawar
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Wednesday, 05 February, 2014, 08 : 00 AM [IST]
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Ashwani Maindola, New Delhi
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fiogf49gjkf0d Africa’s low farm productivity and the non-cultivation of half its arable land, coupled with the pressure of increasing populations and urbanisation on farm land in Asia, provide opportunities for responsible investment by Asian countries in Africa to promote agricultural growth, diversification and employment without comprising on domestic food security. This was stated by agriculture and food processing industries minister Sharad Pawar during his keynote address at the Asia-Africa Agribusiness Forum, organised by the Federation of Indian Chambers of Commerce and Industry (FICCI) and the agriculture ministry.
“The great competitive advantage for Africa is its 733 million hectare arable land, which accounts for 27.4 per cent of the total arable land in the world. Currently, only 183 million hectare land is under cultivation in sub-Saharan Africa, and approximately 452 million still remains uncultivated. Agricultural land in Asia is under pressure from the increasing population and urbanisation. This gives rise to opportunities for investment by Asian countries in the African region,” the minister added, and informed that in Asia, more than 2.2 billion people directly or indirectly depend on agriculture for their livelihood.
More than 60 per cent of the world’s population live in Asia, and heavily depend on agriculture to meet an ever–increasing food demand. The continent has made remarkable progress in agricultural production while dealing with an increasing population and a resultant increase in the food demand. Food production has increased at a rate higher than the growth in population, largely on account of the introduction of high-yielding varieites (HYVs) for cereals, better irrigation facilities and fertilisers, besides support for credit and an assured support price. “These learnings can be, and have to be replicated in Africa, and this is the right forum for the exchange of ideas at the highest levels,” Pawar said.
Dwelling upon India’s experiences with farmers and agribusiness enterprises, the minister stated that in addition to co-operatives, the country has also started promoting farmer producer organisations (FPO) by providing equity and credit guarantee support. “We have not only declared 2014 as the Year of the FPO, but also strengthened the Small Farmers Agribusiness Consortium (SFAC), a specialised body that provides professional, financial and technical assistance to small farmers and their organisations, besides encouraging agri entrepreneurship,” he added.
According to FICCI’s and PwC’s discussion paper, titled ‘Unlocking the Food Belts of Asia and Africa’, there was huge potential for agri-business in the both Asia and Africa, but the growth of the sector depended upon policy environments, capacity and resources. The opportunities in the agribusiness sector had the potential to address various social and economical issues, but there remained substantial barriers to the growth of the sector.
The paper stated that in sub-Saharan Africa and most Asian countries, the agro-based industry needed a major transformation in order to generate more job opportunities, revenues and food for the growing population. Apart from the industrial transformation, farming techniques need improvement in order to offer good opportunities to a large number of smallholder farmers who in turn could pave their way out of poverty.
Sidharth Birla, president, FICCI, in his address, suggested the adoption of new practices and partnerships to multiply agriculture growth and make it sustainable, and stated that greater technical partnerships would help in overcoming low farm yields in Africa.
He said, “Agriculture and food processing are the backbone of most economies in Africa and Asia, and is central to economic growth and stability, as well as the livelihoods of people on the two continents. It will continue to play an central role in the development and poverty alleviation in developing economies, even in an era of economic liberalisation and globalisation. Estimates suggest that by 2030, agriculture and agribusiness industry would stand at around $3 trillion in Africa and almost $4.5 trillion in Asia. However we cannot be content with estimates. We have to look at new practices and partnerships to multiply growth and make it sustainable. Let me highlight a few opportunities.”
“Based on rich agriculture resources in Africa, there is need to examine how Indian and Asian companies can form joint ventures for producing foodgrains, pulses and oilseeds for domestic use in Africa and export,” Birla said.
He said farm mechanisation was an area for partnerships. “India has achieved success here and can be a source of agricultural machinery like harvesting, earth moving, tractors and sowing machinery. Indian companies are keen to partner with companies in Asian and African countries to manufacture such equipment and other inputs,” he added.
“Another opportunity is finance for developing agri-businesses. Various factors limit formal lending to such businesses in Asia and Africa. Lenders, investors and banks can be creative in forming strategic partnerships. In India credit supply has increased greatly through regional rural banks and rural credit cooperatives,” Birla said.
He added that upgrading infrastructure was needed to jump-start agribusiness. Major investment areas are irrigation, water conservation and roads. Public-private partnerships could be an interesting way to address this.
“Post-harvest management facilities, distribution frameworks and other facilities (like packaging) remain bottlenecks. Sharing of best practices could provide lessons. India’s information technology sector could support communities through information hubs and knowledge dissemination at the grassroots level,” FICCI’s chief pointed out.
Peter Kenmore, country director, Food and Agriculture Organisation (FAO), and Sanjeev Chopra, joint secretary, Ministry of Agriculture, gave thematic presentations on the forum.
Dr Vidya Bhushan Soni, chairman and whole-time director, Overseas Infrastructure Alliance, informed the delegates that the Indian Council of Agriculture Research (ICAR), International Agriculture Consulting Group and the International Crops Research Institute for the Semi-Arid Tropics (ICRISAT) constituted a platform for Indo-African partnerships in agriculture to transform Africa by providing Indian expertise and experiences to finance solutions to their food and agriculture development challenges.
“ICRISAT,” he said, “would use its Agribusiness and Innovative Platform initiatives to help set up agribusiness incubators for farmers across Africa, along the lines of network incubators in India.”
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