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Bank of Agriculture, agric revolution and matters arising

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The Bank of Agriculture (BOA) recently signed an agreement with Lovol, one of the leading Chinese technology companies that specialises in the manufacturing of tractors, to execute a 300 million-dollar agricultural mechanisation programme in the country.

The bank, precisely in April, signed the agreement with Lovol and a Nigerian company, Agromech, to implement a three-year agricultural programme aimed at revolutionising the sector.

The agreement provides that the company will supply various categories of tractors, farm equipment and inputs from China in the first year, although the agreement covers three years beginning from next farming season.

Going by the agreement, the company will subsequently set up tractor assembly plants with maintenance units at different locations across the country as part of the Federal Government Policy Roadmap on Agriculture.

BOA observes that the agreement will quicken the impact and sustainability of agricultural sector through comprehensive mechanisation programme for farmers at all levels to enhance production and stimulate economic growth.

According to the bank, funding of the programme would come from Central Bank of Nigeria (CBN), African Development Bank, China Exim Bank and bonds from National Pension Commission.

The bank notes that the benefitting farmers would contribute 30 per cent equity of the cost of the tractors and equipment, payable within three years.

According to the bank, the approach is under strategic production plan for exportable crops targeting the policies of the Federal Government.

It says the plan is also tailored towards the CBN Export Stimulation Plan to boost annual foreign exchange earnings.

The bank expects that the plan will generate between three billion dollars and 10 billion dollars through exports of cash crops harvested by farmers under the programme.

“Part of the agreement is to ensure growth in irrigation practice and Farmers Empowerment Scheme for food security and poverty alleviation,” the bank stresses.

In the light of this, agriculturalists note that the Federal Government process of agricultural mechanisation can become a catalyst for development, especially when necessary structural changes are made to turn around the sector to become commercially oriented.

They cite statistics from the Food and Agriculture Organisation (FAO) that shows that Nigeria is one of the least mechanised farming countries in the world.

Worried by this, the Minister of Agriculture and Rural Development, Chief Audu Ogbeh, said “the total number of tractors in the country is estimated at about 35,000, over 50 per cent of which have broken down due to nature of farm lands, lack of sustainable products’ sales services and poor maintenance culture.’’

Agriculturalists, therefore, observe that the low level of mechinisation limits the ability of farmers to expand cultivation areas that would have increased food production to reduce hunger and poverty among Nigerians.

They recall that available data from the FAO also shows that Nigeria is ranked 132 out of 188 countries on per capita basis worldwide in terms of the number of tractors in the country.

They observe that Nigeria has a record deficit of more than one million tractors going by the country’s farming population and size of arable land as well as global standards.

They insist that farming in the country remains mostly primitive with hand tools, thereby limiting productions and other farming activities.

To reverse the trend, BOA says it has proposed to implore “Producers Cooperative Mechanisation Platform”, consisting of not less than 10 smallholder farmers in a group to benefit in the lease to own tractor with a maximum tenure of two years.

It stresses that the group is expected, among other conditions, to use 50 per cent of produce harvest and 60 per cent of revenue generated from tractor hiring services to repay the loan.

According to it, there is also the Individual Producer Mechanism Platform in which individual farmers are expected to own a minimum farm land of 10 hectares.

In that regard, such individual will use 70 per cent of produce harvest and 80 per cent of revenue generated from tractor hiring services to repay the loan.

“Graduate Mechanisation Platform, devised by the bank in which unemployed graduates from relevant disciplines would be encouraged to register an enterprise with the Corporate Affairs Commission and also surrender their tertiary certificates to the bank as collateral,’’ the bank states.

In this scheme, the bank recommends that the graduate is required to own a farmland of up to 10 hectares and use 50 per cent of produce harvest as well as 50 per cent of revenue generated from tractor hiring for repayment of the loan within two years.

Malam Nuhu Aminu, Chairman, Kaduna State Branch of All Farmers Association of Nigeria (AFAN), commended BOA for the mechanisation initiative, saying that the move would bring about the long awaited revolution in the sector.

He said the programme should be allowed to run freely and left open to all categories of farmers who met 50 per cent of the conditions of the credit facility to benefit.

Also, the Chairman, Rice Farmers Association of Nigeria (RIFAN), Mrs Jummai Victor, appealed to the bank to introduce a model for women farmers who did not own farm lands to benefit from the programme.

Victor said women constituted substantial percentage of farmers in the country but did not own farm lands due to some cultures and economic factors.

She called on the bank to soften the condition for the women farmers to be able to key into the programme and tackle poverty and food security of both their families and the country.

She commended the bank for the plan to install tractors’ tracking device in each of the tractors for monitoring and control, saying that the move would significantly curtail sharp practices and default in loan repayment.

Observers, however, laud the agreement, insisting Nigerian agricultural sector should utilise the opportunity presented by the programme.

They urge the Federal Ministry of Agriculture and Rural Development to ensure that the mechanisation programme derives the maximum and desired result.

According to them, the programme will diversify the nation’s economy and address challenges of food shortage through increased production of both food and cash crops for local consumption and exports.


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