The Asia Africa Agribusiness Forum (AAAF) recently organized by FICCI in New Delhi saw the presence key important dignitaries and Government officials of agriculture and related ministries from more than 80 countries from Asia and Africa.
Mr. Advait Chaturvedi, E.D. Operations, OIA was among the key speakers for a session on 'Access to market finance and PPP in Agribusiness and Food Processing' along with Mr. Kevin Chan, Senior Research Fellow, International Food Policy Research Institute (IFPRI), Asian Development Bank and Mr. NeerajVij, Chief Investment Officer and OIC, African Development Bank.
The session saw a discussion on how value chain financing and its importance to African markets. Mr. Chaturvedi shared that, value chain financing exists in Africa, especially in South Africa where private sectors encourage coffee beans farmers by providing 3rd party finances for farming which allows farmers to have a long term perspective than a short term. The only drawback he foresees is the farmers feeling squeezed by large corporations, however currently there are no major complaints.
Africa currently has the largest unutilized agricultural land in the world along with vast water resources and is seen as the next growth frontier for agribusiness by the world. However, having just land for cultivation is not fruitful without these basic infrastructure amenities to reach the market. To bring Africa to its maximum potential, enabling infrastructure which not only includes roadways and railways but also irrigation and electricity is the key.
One prevailing assumption about the agribusiness in Africa is, the one who gets into agribusiness is not a farmer which is not so. The African farmer has a desire to conduct agribusiness but the question of the ownership of land comes up as many cultivable land areas are under communal ownership of the people which needs to be clarified for conducting successful agribusinesses.
The session was also graced by the presence of key speakers such as Mr. Matsuo Takashi, Director of Environment, Natural Resources and Agriculture Division, Asian Development Bank, Mr. PrahalathanIyer, Chief General Manager, EXIM Bank of India and Mr. H.R. Dave, Chief General Manager, National Bank for Agriculture and Rural Development (NABARD).
The concluding remark at the session was in regards to low risk appetite for agribusiness which was prevailing due to the low returns which agribusiness generate for the people.