The Nigeria Incentive-Based Risk Sharing System for Agriculture Lending (NIRSAL) has now form an agricultural mechanization partnership with the National Agency for Science and Engineering Infrastructure (NASENI) and Machine and Equipment Consortium Africa (MECA) to boost the agricultural sector by repairing grounded tractors across the country.
Speaking at the Stakeholders forum in Abuja, the Managing Director of NIRSAL, Aliyu Abdulhameed, said the pact, which is a tractorisation project, will ensure that 10,000 tractors would be repaired annually.
“Already, 11 workshops are being built across the country to commence the tractor repair exercise nationwide.
“For an average price of (let’s say) N12 million naira (the cost of a tractor), that will amount to about N120 billion worth of equipment that needs to be serviced. The deal would rake in N1.2 trillion into the Nigerian economy in 10 years.”
Abdulhammed further revealed that the repairs would be financed through the banks to the tune of N1.5million which would help to transform the Nigeria agriculture sector from 19th to 21st century.
“Our mandate is to provide an enabling environment for commercial banks to lend money to farmers and those that want to purchase tractors. Mind you, an average tractor costs N12million.”
He noted that the poor maintenance culture of farmers is the reason, many tractors are left without being serviced.
“Statistics have shown that tractors do not last more than 12 months in Nigeria and after 12 months it goes into disuse. When nothing is further done to revive them, they gather dust and become obsolete.’
“Meanwhile, an average lifespan of a contractor for maximum productivity is between 25 to 30 years of purchase. Also, tractors work in prepared piece of land. So using a tractor for another purpose for which it was not made for is another problem.”
NIRSAL, a public-private initiative was launched by Central Bank of Nigeria (CBN), as a dynamic, holistic USD 500 Million agribusiness funding, aimed at enabling the flow of affordable financing of agriculture related business.
It provides solution to low funding in the agriculture sector and also de-risk by lending money to players along the entire agriculture value chain.
The MD added that reparation project will create job opportunities for 35,000 technicians, drivers and mechanics as a tractor is expected to service three acres of land.
In 2016, Federal Government signed a Memorandum of Understanding (MOU), with a Chinese Company, CAMACO to supply 80,000 tractors to farmers.
