$200m loan to transform farming

The amount has been revised from $300 million to $200 million due to realignment of the World Bank’s own priorities.

An official statement issued by the Washington-based lender said that the loan would support Pakistan in transforming the agriculture sector by adopting climate-smart technologies to improve water-use efficiency, build resilience to extreme weather events and increase incomes of small farmers.

The agriculture sector in Punjab is central to Pakistan’s economy and food security as it accounts for 73% of the country’s total food production, it added.

The loan has been given under the Punjab Resilient and Inclusive Agriculture Transformation Project (PRIAT) that will support farmers at the community and household levels to adopt climate-smart farming practices and technologies that improve crop yields and conserve water resources
in Punjab.

In recent years, Pakistan’s agriculture sector has suffered from losses in crop yields and livestock, damage to irrigation infrastructure, and food shortages due to climate change, particularly severe droughts in the Punjab province, said Najy Benhassine, World Bank Country Director
for Pakistan.

This project aligns with the Punjab Agriculture Policy 2018, which promotes massive expansion of water conservation efforts, enhancing sustainability and resilience in the wake of climate change, and private sector participation to help boost productivity of the sector, he added.

Project Task Team Leader Guo Li said that PRIAT would help accelerate the government’s efforts to transform the agri-food system through market-oriented production activities that add value, increase competitiveness and generate higher incomes
for farmers.

The World Bank said that the project would benefit about 190,000 small, family-owned farms and 1.4 million acres of irrigated land in rural communities in the Punjab province.

It will also provide training to small- and medium-sized farm owners in water conservation and more sustainable, climate-resilient agricultural practices, including for women.

About 74% of women in the province rely on agriculture as a source of livelihood.

Initially, the project size was $400 million, including $300 million of World Bank lending. With the $400 million financing, the total number of beneficiaries had been estimated at over 420,000 farm families and over 2.5 million acres of irrigated area.

For the past few months, the foreign loan disbursements have significantly slowed down, largely because of delay in finalising a deal with the International Monetary Fund (IMF) and also due to slow progress on
many schemes.

The Ministry of Economic Affairs has not been able to effectively perform its functions of monitoring and ensuring rapid disbursement of foreign project financing. There is an urgent need to bring administrative changes in the ministry.

Sources said that the government was delaying a decision on replacement of the economic affairs secretary, who is going to retire next month.

The focus of the current administration of the ministry is more on the logistic matters than playing an effective role of a window between Pakistan and the international lenders.

Out of the $200 million loan from the World Bank, a major chunk will be spent on community-driven improvement of water conveyance and application aimed at improving the equity of water access within the watercourse command area and enhancing agricultural water productivity.

The plan also includes diversification in production through a market-driven and climate-smart approach and establishment of market linkages.