The Nigerian Incentive-Based Risk Sharing System for Agricultural Lending (NIRSAL), in partnership with some equipment manufacturers, has unveiled a scheme that would guarantee maintenance for tractors and other agricultural equipment for states and local governments with about N120 billion.
At the unveiling of the scheme tagged ‘Agricultural Mechanisation Management Contract Service for Sub-National Governments’, the Managing Director of NIRSAL, Mr Aliyu Abdulhameed, said the objective of the project is to bring back about 100,000 units of tractors back to life.
“The project represents a giant leap for the mechanisation of agriculture in Nigeria, to improve tractorisation and density of tractor services in Nigeria’s agricultural primary production space.”
NIRSAL is providing 75 per cent guarantee to the total amount that is required to be able to service 10,000 units of tractors a year for the next 10 years. “At an average price of N12 million per tractor, that would be equivalent to N120 billion worth of equipment that needs to be serviced,” he said
According to him, “if Nigeria requires 10,000 tractors every year for the next 10 years in order to meet the global average for doing an average of three hectares per tractor a day, we will end up doing 3.6 million hectares. And that will translate to 1.2m metric tons of grains which translates to N3.2 trillion worth of grains to be produced within a year.”
The project is jointly supported by the Machine and Equipment Consortium Africa (MECA), National Agency for Science and Engineering Infrastructure (NASENI), insurance companies and banks.
A key objective of the new scheme is to end the colossal waste of billions of Naira which was invested in acquiring agricultural equipment that are gathering dust all over the country and deploy them to boost agricultural production.
It is estimated that there are about 50,000 disused tractors and other equipment in different parts of the country.
According to the terms of the partnership, NIRSAL will provide credit risk guarantee and technical advisory support services while NASENI and MECA will be responsible for financing, refurbishing and managing the equipment.
The Chief Executive of MECA, I.B. Gashinbaki, said his company, as co-anchor of the project, will work with states and other partners identified in about 11 co-locations.
He said workshops are being retooled and upgraded to ensure that tractors that have broken down are repaired without delay.