Quick Facts:
Project Name: Agribusiness Development Project
Country: Pakistan
ADB Financing:ADF ($ million): 31.00
Total Project Costs($ million): 21.59
Signing Date: 14 Jun 2005
Closing Date: 31 Mar 2011(expected)
30 Sep 2011(actual)
Brief Description:
For developing countries like Pakistan agriculture plays a crucial role for its economy and
development. Almost half of labour force almost 48% is engaged directly with agriculture.
The major part of economy population income or living source is agriculture. This project is
developed in order to facilitate the agriculture sector. The agribusiness project main aim is to
address constraints to development of the sector and to exploit opportunities. The purpose of
this project is to increase agribusiness economic growth and rural employment through
grabbing domestic and export market opportunities. Though agriculture is an important sector
of Pakistan’s economy but the present condition of agriculture due to negligence of the
government and inadequate funds allocation has severely devastated. Agricultural
productivity was declining years before the loan approval in 2005. This sector was given the
value when the emphasis on poverty reduction in the country is placed. The purpose of greater
value addition in this sector was to grow the economy more rapidly and generate more jobs.
Agricultural products, especially horticultural output and related exports, including dairy
development commercial value meant to be increased through this project. . The aim also was
to introduce new varieties of products, innovative practices and upgrade the skills and
competency levels of farmers and entrepreneurs producing and marketing commercial
agricultural products.
Expected Impact:
All the projects have short term or long term impacts. Mainly in this project the growth is concerned
therefore the expected impact of the project was to promote growth of agribusiness activities in the
country. The share of agribusiness in gross domestic product was expected to increase by 30% in
September 2010 as we compared it to baseline estimate of December 2005. Along with this the
number of new and expanded agro-enterprises was projected to increase by about 2,000 and to generate
jobs of up to 100,000 person-years by September 2010.
Objectives or Expected Outcome
To making Pakistan’s agribusiness more competitive and sustainable was the main aim of this
project. This was to be done by improving the different important skill levels of entrepreneurs and
farmers, through participating financial institutions (PFIs) increased in supporting agribusiness
lending , to facilitate agribusiness development through public–private partnerships with the help of
government institutions, becoming more attentive to the needs of private sector engaged in
agribusiness and establishing the framework and standards necessary for Pakistan’s agribusiness to
comply with increasingly stringent international standards. The vertical integration in the value chain
(from the field to the consumer) is sought to be established in this project.
Outputs
The project outputs were distributed across five project components:
Provision of support services
The output will help facilitate increased access to business development services for agribusiness
enterprises, which included establishing an agribusiness support fund (ASF) and upgrading different
skills. Research, extension of agriculture, and required training support were also to be developed and
provided to the agribusiness subsector. With the support of nongovernment organizations addressing
the needs of the private sector farmers and entrepreneurs these support services will be extended.
Agribusiness finance development
This will help PFIs understand the potential agribusiness finance market and enhance their capacity to
undertake agribusiness lending. The plans showing enhanced agribusiness financing opportunities
PFIs were to develop such business plan. The State Bank of Pakistan (SBP) was responsible for
implementation.
A capacity-building component
This will consist of six subcomponents the first is rationalizing and restructuring the Ministry of Food,
Agriculture, and Livestock (MINFAL), which was subsequently restructured as the Ministry of Food
and Agriculture (MINFA), with its offices and agencies responsible for alignment with World Trade
Organization regulations and international product standards, second is dissemination agribusiness
market information to the public and private sectors third, strengthening the capacity of the
Department of Agriculture and Livestock Product Marketing and Grading
(DALPMG) for export quality certification; (d) strengthening the seed and planting material
certification by the Federal Seed Certification and Registration Department (FSCRD); (e)
providing training to build the capacity of agribusinesses implementing project activities; and
(f) establishing the Livestock and Dairy Development Board (LDDB) as a corporate entity.
Development of a policy and enabling environment
This will result into policies that are appropriate to private sector growth of agribusiness in Pakistan.
Project coordination and management support
This will ensure the achievement of the above-mentioned four outputs.
Reason of failure:
