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Corporate Farming

The Potential of Pakistan Corporate Agriculture Farming

 
Pakistan’s Agriculture Base: Strengths
  •  Abundant agricultural land

Total area

79.6  Mn Hectares (MH)

Cultivated area

22 MH

Irrigated

18 MH

Rainfed (Barani)

4 MH

  • Contribution to economy

  • 26% to GDP

  • Employs 44% of labour force (16.35 Mn)

  • 70% of exports (Agri-produce & processed products)

  • Natural Merits

  • 4 seasons, tropical weather

  • Crop production throughout the year

  • Largest canal irrigation network

  • Vast tracts of land along Indus Basin - comprising 5 rivers

  • Centuries old farming culture

  • Amongst the lowest cost producers

  • Cost effective and hardworking agricultural manpower

  • Low cost irrigation water

  • Reasonable price of land

  • Farm to market road network

  • Competitive cost of inputs

  • Crops production

Wheat

21 Mn tons

Cotton   

11 Mn bales

Rice    

 5 Mn tons

Sugarcane  

50 Mn tons

Fruits/Vegetables

10 Mn tons

  • Fisheries & Livestock production

Fisheries potential (annual catch) 

7.5 Mn tons

Buffaloes (Number)  

 23 Mn

Cattle (Number)        

22 Mn

Sheep & Goats (Number)

75 Mn

Poultry (Number)       

530 Mn

  • Country side

  • Traditional but simple culture

  • Inspiring music  

  • Lively folk

  • Strategic location

  • Located in food deficit region:

    •  Central Asian Republic  (North)

    •  Middle East  (South)

    •  Iran & Afghanistan (West)

  • Principal gateway to CARs

  • Strong historical & traditional links

  •  Strong Potential

  • Comparative advantage in the region

  • Vast areas of cultivable waste land available

  • Strong potential for expansion of agriculture base

Corporate Agriculture Farming (CAF):

Objectives

  • Large local market increasing at 29% per year

  • Internationally competitive unit cost of production    for all major crops, fruits & vegetables

  • High quality agricultural products due to favourable resource base

  • Low transportation cost, and developed routes to Middle East, Iran, Afghanistan and CARs

  • International Quality inputs available in country

  • Market driven polices. Least Government interventions

 

Investment Policy, Incentives & Opportunities:

 

Most Liberal Investment Policy: 

  • CAF declared as an industry

  • 100% foreign equity allowed

  • No minimum foreign investment

  • Remittance of capital, profits, dividends allowed

  • CAF will enjoy credit & other facilities

  • Local or foreign, private or public limited  companies to invest in corporate farming

  • No ceiling on land holding

  • State land can be purchased, or leased for 50 years, and extendable for another 49 years

  • All banks and financial institutions will earmark separate credit share.

 

Attractive Fiscal Incentives:

  • 0% Customs duty on import of agricultural machinery, equipment and implements (not manufactured locally) New or used

  • Exemption of duty on transfer of land for CAF (under consideration)

  • Tax relief: First Year Allowance @ 75% of PME cost

  • In Addition:

  • Provincial Agriculture Income Tax (AIT) laws provide for proportionate liability of corporate shareholders

  • Dividends from corporate agricultural farms (for non-industrial activities) not subject to tax

  • Farm income given more favourable treatment than non-farm corporate incomes because of the risk/uncertainty associated with farming

  • Existing definitions of farming activity, as distinct from processing/industrial activity, continue to be maintained.

Investment Opportunities:

  • Land development/reclamation of barren, desert and hilly land for agriculture purpose and crops farming

  • Reclamation of water front areas or creeks  

  • Crops, fruits, vegetables, flowers farming/integrated agriculture (cultivation and processing of crops)

  • Modernization and development of irrigation facilities and water management Plantation 

  • Forestry

  • Horticulture

  • Dairy farming

  • Livestock farming, breeding and small ruminants (sheep, goat)

  • Production of quality seeds

  • Fruits, Vegetables & flowers – grading, processing, packaging, preservation

  • Seafood (farming/fishing, processing and preservation of fish, shrimps and other marine products)

  • Agri-produce storage facilities (separate package)

  • Marketing/Export of Agri-produce (separate package)

  • Cool Chains (separate package)


Source: Pakistan Board of Investment 

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