Credit uptake by livestock, fishery
“Out of 81,000 borrowers, some 79,000 have smaller livestock farms’’, the report reveals. “More than half a million big and small livestock owners supply milk to over half a dozen companies marketing branded milk”, a senior executive of one such company told Dawn on Thursday.
Not only the livestock sector, fisheries, poultry and other non-crop sectors in agriculture are also showing increasing demand for bank loans. In fisheries, the number of bank borrowers jumped up to 1,145 in 2007-08 from only 248 in 2004-05. Poultry is still struggling to overcome from birds’ flu that struck twice in last two years and claimed lives of thousands of birds. It brought down a sharp drop in sales that hit many farm owners Nonetheless, more than 1,500 borrowers sought loans from banks last fiscal year ‘to improve conditions of their farms.’
“Crop farming, livestock, dairy, poultry and fishing are set to play a key role in food security programme and will attract huge investment,’’ a senior banker in one of the privatised bank indicated. If all goes well, the banker is convinced that agricultural credit disbursement may exceed Rs500 billion a year within next one or two years.
The SBP report shows an allocation of almost Rs16 billion to the livestock sector in 2007-08. It reports an average of Rs0.2 million loan for each borrower. Substantial amount was taken by the small farmers for purchase of chillers for acquiring hygienic and sanitary standards set by the milk processing and packaging companies.
No wonder, the electronic media now shows a good number of advertisements of branded milk. Consumers are being asked to pay more on milk at the retail outlets. Those in milk business see further rise in retail milk prices. They say that the energy cost pushes up operational cost of companies that collect, process and pack milk and then transport it to retail outlets. Added to this is the rising bank interest charges and cost of fodder and other industrial inputs.
In last ten years, milk distribution pattern in the 15-million populated city of Karachi has seen tremendous changes.
While the federal government started taking policy initiatives for setting up a Pakistan Dairy Development Board, the provincial governments in last few years have taken up livestock farms development projects and allied services in their annual development outlays.
In Sindh, a state of art livestock farm is being developed in the vicinity of Karachi on national highway at Ghaggar Phatak which will be a source of dairy products well as of meat.
At 33 million litres annual production, Pakistan is the fourth biggest milk producer. The PDDB has been entrusted with the job of raising milk production to 40 million litres by 2015 to generate three million jobs. “The major thrust is to provide about 6,330 chillers of different capacities to livestock farmers through soft loan facility,’’ informs the SBP report. The PDDB reckons that an additional two billion litres of milk can be added to the mainstream supply by providing chillers to the farmers through soft loans.
Construction of Coastal Highway has led to setting up of more than a dozen processing plants in Balochistan to boost seafood export which has created a demand for bank loans. A senior official of Marine Fisheries Department revealed emergence of a few distinct features in fish export. Jelly fish discarded as a poisonous variety for years is now much in demand in China where it is eaten after processing. Thailand is offering more than double the price of a small fish that was considered trash or sold virtually at throw-away price.
“At least no fisherman has received any bank loan’’, Mr Mohammad Ali Shah, President of the powerful Pakistan Fishermen Folk Forum (PFFF) replied to a question. He said some seafood processors or exporters might have availed the bank loan facility.
The PFFF contends that fish stock in sea waters is dropping alarmingly which calls for remedial measures. The PFFF is seeking a long-term sustainable fishing policy from the government and plans to organise a countrywide meeting in Karachi within this month. Haji Shafi Jamote, Nazim of Ibrahim Hyderi Town Committee who was associated with Fishermen Cooperative Society complains that Karachi Fish Harbour is being managed by a hand-picked administrator instead of an elected body of fishermen.
Fish prices in open market these days are very high because the annual catch from the seas is gradually dropping while the export is on rise. The country is set to export $230 million worth of fish in 2008-09, up from $212 million in 2007-08. Those in fish business and in the government say that a considerable quantity of fish is being exported to EU. The EU’s official restriction is being circumvented through Dubai and other adjoining ports.
“Fish promotion has never been considered as a part of national food security programme,’’ complained Mohammad Ali Shah. How critical is the situation is best illustrated by the fact that fish is now being imported from Maynamar.
The government has recently imported three ice flak plants that can freeze sea water into ice. These have been sold to three trawlers’ operators and government plans to import 27 more such plants. Installation of these plants aboard trawlers will provide a saving on fuel. It is yet to be seen how successful these plants prove.
There is now a mounting demand to modernise fishing. Fishermen are perpetually under debt. The PFFF wants improvement in fish marketing system to minimise the role of middle men.
“The attack of birds’ flu has shrunk local poultry business by at least 35 per cent in last two years,’’ Mr Kemal Akhtar Siddiqui, a leader of the Sindh Poultry Farmers Association said.
His complaint is that poultry is not offered any incentive or concession by the government in loans, taxation or in any way, though it is more than Rs10 billion industry that provides almost 40 per cent of meat requirement.
As poultry feed prices have increased, farm upkeep and maintenance cost is showing no signs of respite, the production cost is becoming unbearable, industry sources said.
Bankers look at livestock, dairy farming, fishing, poultry and agricultural related non-crop business as, “pretty promising’’. But as a senior banker observed, a lot more has to be done by the government at policy and operational level to bring down production cost and streamline marketing by reducing role of middlemen. Much more attractive is the investment potential from the neighbouring oil-rich Muslim kingdoms in crops, livestock and dairy and poultry.