Agriculture, livestock sector being ignored: PEW
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The Pakistan Economy Watch (PEW) on Friday said banks continue to ignore agriculture sector which is keeping farmers poor and dependent on informal lenders offering costly loans.
Around seventy percent of the farmers are dependent on parallel financial system working in rural areas as banks avoid advancing loans to this important segment despite best efforts of SBP, said Dr. Murtaza Mughal, President PEW.
The agriculture and livestock sectors comprising 44 percent population and 21 percent share in GDP gets 6.5 percent of all the loans issued by the commercial banks which is insufficient to bring a change in the lives of farmers.
Dr. Murtaza Mughal said that ratio of default among farmers has come down to one percent from eighteen percent but it has not pressed the financial sector to think positively about it.
Scarcity and difficulty in getting loans from formal sector forces majority of the farmers to pledge their produce with loan sharks who pockets all the dividends, he informed.
He said that availability of cheap credit is the only way to accelerate development of agricultural sector and ensure food security.
Dr. Murtaza Mughal said that relationship between finances and development is evident thence farmers cannot be left of the mercy of informal lenders.
He said that government must pay attention to agri-reforms, encourage R&D, design new products for rural population and pay attention to rising input costs to stimulate agricultural growth as major industries including textile, sugar and leather depends on rural economy.
Despite 25 percent of cultivable land and one of the finest irrigation systems of the world the agriculture sector is in the air which proves lack of interest of the authorities.
