Pakistan offers farmland to Saudis
Wednesday, 11 June 2008
Farhan Bokhari, FT Syndication Service
ISLAMABAD: Pakistan has offered to facilitate the sale of thousands of acres of some of its most productive farmland to Saudi Arabia in an attempt to attract large Saudi investments in the country's farm sector.
Yusuf Raza Gilani, Pakistan's prime minister, said last Monday on his return from Saudi Arabia there had been successful talks on food production but declined to offer details. "A major breakthrough has been achieved," he said.
The land offer follows news last month that a large private equity company was buying farmland on behalf of the United Arab Emirates' food security effort.
Prices of wheat, rice and other food items have been rising rapidly in Pakistan, fuelling public anger. Some critics question the government's policy of offering farmland to other states to fulfil their food demand at a time when grain production is falling short of domestic needs.
The shortage of key food grains has been complicated further by Pakistan's failure to raise prices to the level of neighbouring countries. Cheap wheat prices have fuelled smuggling.
"It is dangerous to enter agreements for commodity exports when you can't be certain if you can be self-sufficient to begin with," said Suhail Malik, a Pakistani economist.
A senior western agriculture expert said: "Pakistan should not close the door to this option [of selling farmland]. You can bring in billions of dollars in investments. But you have to have a detailed outline of policy such as some agreement on just allowing a proportion of production for export while the rest is exported when there aren't shortages in Pakistan."
Government economists said that in view of deteriorating economic conditions, the new administration elected in February was desperate to win Saudi support. Mr Gilani's Saudi trip, ahead of Wednesday's presentation of the annual budget, was centred on winning approval for deferred payment on at least $2.0bn (euro1.3bn,
ISLAMABAD: Pakistan has offered to facilitate the sale of thousands of acres of some of its most productive farmland to Saudi Arabia in an attempt to attract large Saudi investments in the country's farm sector.
Yusuf Raza Gilani, Pakistan's prime minister, said last Monday on his return from Saudi Arabia there had been successful talks on food production but declined to offer details. "A major breakthrough has been achieved," he said.
The land offer follows news last month that a large private equity company was buying farmland on behalf of the United Arab Emirates' food security effort.
Prices of wheat, rice and other food items have been rising rapidly in Pakistan, fuelling public anger. Some critics question the government's policy of offering farmland to other states to fulfil their food demand at a time when grain production is falling short of domestic needs.
The shortage of key food grains has been complicated further by Pakistan's failure to raise prices to the level of neighbouring countries. Cheap wheat prices have fuelled smuggling.
"It is dangerous to enter agreements for commodity exports when you can't be certain if you can be self-sufficient to begin with," said Suhail Malik, a Pakistani economist.
A senior western agriculture expert said: "Pakistan should not close the door to this option [of selling farmland]. You can bring in billions of dollars in investments. But you have to have a detailed outline of policy such as some agreement on just allowing a proportion of production for export while the rest is exported when there aren't shortages in Pakistan."
Government economists said that in view of deteriorating economic conditions, the new administration elected in February was desperate to win Saudi support. Mr Gilani's Saudi trip, ahead of Wednesday's presentation of the annual budget, was centred on winning approval for deferred payment on at least $2.0bn (euro1.3bn,