New on Gulf's shopping list: Foreigners' farmland (IHT)

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New on Gulf's shopping list: Foreigners' farmland
The Associated Press
Monday, November 17, 2008
NAHEL, United Arab Emirates: In the dunes around this sun-scorched desert village, where camels still plod along dusty roads an hour south of Dubai's skyscrapers, farmers are making the wasteland bloom.
Row upon row of bell peppers grow plump in a temperature-controlled greenhouse. Lilies and roses bud nearby, and strawberries are on their way, all thanks to sophisticated water-saving irrigation.
Yet even high-tech establishments like the Mirak Agricultural Services farms here and elsewhere in this riverless country will never feed the region's rapidly growing population. It is that realization that is persuading wealthy Gulf Arabs to look far beyond their shores for more fertile acreage - tens of thousands of hectares, in some cases.
There are simply too many mouths to feed and not enough water. Lush urban landscaping and ambitious agricultural projects here and in Saudi Arabia, which once spent so much on farm subsidies that it exported surplus wheat, are quickly draining aquifers, including some that are millennia old and cannot be refilled.
That stark reality, and rising food prices, is sending the region's leaders scrambling to lock up even more long-term food supplies abroad. And where once the region was content to spend its petrodollars on food sold on the open market, Gulf nations now are quietly scouring the globe for rich farmland to rent or buy outright.
The prime ministers of Qatar and Kuwait traveled separately to Cambodia this year to discuss securing paddy land for rice-growing. Sheik Khalifa bin Zayed Al Nahyan, president of the United Arab Emirates, visited Kazakhstan in central Asia, where agricultural investments were on the agenda.
Dubai World, a sprawling conglomerate controlled by that emirate's government, last month said it was creating a new subsidiary targeting global investments in a wide range of commodities, including food.
Plans are also accelerating in the private sector.
The Saudi Binladin Group, for example, is considering investing more than $4 billion to grow food in Indonesia, said Salim Segaf al-Jufri, the Indonesian ambassador to Saudi Arabia. Under the proposed project, the company would produce basmati rice in Sulawesi, Papua and western Java.
Most such talks are continuing in private. Of those companies that could be reached for comment, none made officials available to discuss their investments in detail. That may be because many of the deals are being hatched in volatile countries, such as Pakistan and Sudan, that have serious domestic food concerns of their own. The idea of shipping off homegrown crops to feed rich foreigners could stir dissent.
"These are countries that come with a lot of political baggage," said Eckart Woertz, program manager for economics at the Gulf Research Center, which estimates the Gulf's conventional water resources will be gone within three decades. "People riot when they don't get food."
Experts say the agriculture investments could be a win-win situation. The Gulf gains food security, while poorer developing countries benefit from added jobs and improved technology.
But there are concerns, too.
The head of the UN Food and Agriculture Organization, Jacques Diouf, has warned that foreign land acquisition and long-term leasing schemes, if done poorly, risk "creating a neocolonial pact" and "unacceptable work conditions for agricultural workers."
Even so, some countries are seeking out investment.
Pakistan, already a key source of labor for the Gulf, has been among the most active. This spring, Islamabad helped organize a show in Dubai aimed at increasing investment in the country's agricultural and dairy industries.
Huma Fakhar, managing partner at MAP Services Group, a market research and trade consultant which sponsored the event, said Pakistan was a logical choice for Gulf investment.
Fakhar said an investor from Abu Dhabi, whom she declined to name, last year bought about 16,000 hectares, or 40,000 acres, of farmland in the Pakistani province of Baluchistan. Two UAE firms, Emirates Investments Group and Abraaj Capital, have also expressed interest in investing directly in Pakistani agriculture, she said.
http://www.iht.com/articles/2008/11/17/asia/gulf.php



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Export woes may send Afghan farmers back to drugs (IHT)

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Export woes may send Afghan farmers back to drugs (IHT)
Reuters
Tuesday, November 11, 2008
By Jonathon Burch
A bumper fruit harvest in Afghanistan this year has led to a surplus for domestic markets and with difficulties in exporting the goods, growers could return to harvesting opium, experts and farmers say.
Afghanistan used to produce some of the region's best fruits and nuts but insecurity led farmers to switch to opium, a crop that funds the Taliban insurgency, adding to insecurity and further boosting drug production.
While cultivation of opium, the raw ingredient for heroin, decreased this year, Afghanistan still produces some 90 percent of the world's supply of the drug.
Encouraged by international aid groups, some farmers have switched from growing opium to fruit and other products in recent years, but with little financial benefit and export problems, many could revert to more lucrative illicit crops.
"Farmers will always go for products with the highest benefit, especially with all the post-harvest problems," Mohammad Aqa, assistant representative for the U.N.'s food and agriculture organisation in Afghanistan (FAO), told Reuters.
But problems with processing, packaging and storing produce, along with poor access to international markets, means many farmers are not even able to cover their costs, said Aqa.
A fruit surplus is unlikely to meet the needs of millions of Afghans facing severe food shortages this winter as droughts in many areas of the country have hurt the staple wheat harvest.
"GOVERNMENT RESPONSIBLE"
Many farmers around the capital are feeling the strain and calling on the government to do more.
"If the government doesn't find us an export market and we don't benefit from our agricultural products and suffer financial harm like past years ... then we will have to return to poppy farming," said Safatullah Khan, a farmer on the outskirts of Kabul.
Due to the problems with exporting goods and the unregulated import of products already grown in Afghanistan, such as apples and grapes from China and Pakistan, farmers are forced to sell at very low prices, said Aqa.
A 7 kg (15 lb) bag of apples costs just $3 (1.93 pounds) in any of the capital's fruit markets.
"I agree with the farmers, they need more support. The government needs to at least limit these kind of imports ... in order to make them (farmers) competitive in the international market," said Aqa. "It's not a good time to introduce a free market in Afghanistan at the moment."
The government's export agency (EPAA) says it is aware of the problem and is working on finding a solution.
"We know that Afghan fruit production reached high levels this year, especially apples. These high levels of production have created problems and worries in society," said Rohullah Ahmadzai, spokesman for EPAA.
"I know the sharp increase in production within the market is worrying the farmers, but we will solve this issue soon," he said. He added that despite problems in exporting, $21 million worth of fruit was exported from Kandahar province alone.
(Editing by Valerie Lee)





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Apples and onions cross frontier in disputed Kashmir (IHT)

Reuters
Tuesday, October 21, 2008
By Aftab Borka
Trucks loaded with apples, onions and nuts crossed the frontier in divided Kashmir for the first time in decades Tuesday as nuclear-armed India and Pakistan opened a trade link aimed at easing tension.
The decision, taken only last month, to allow limited trade across the front line in Kashmir symbolises attempts to solve a bitter dispute over the Himalayan region by creating "soft borders" allowing the free movement of goods and people.
"I'm quite confident that this beginning will lead us to proper and regular trade and commerce," Sardar Attique Ahmed Khan, prime minister of Pakistani Kashmir, told reporters.
But Khan cautioned against hopes the opening of trade across an old cease-fire line and the de facto border, known as the Line of Control (LOC), would lead to a quick solution of the more than 60-year dispute over Muslim-majority Kashmir.
"All these steps, cross-LOC trade, communication, people-to-people contacts, talks, all these things slowly and gradually they are most generally contributing factors towards the ultimate resolution," Khan said.
"But no high hopes should be attached, no wild wishes should be attached to only the one event of today. But this is a great success," he said.
Indian Kashmir's governor, N.N. Vohra, said the trade link was a major step in a slow-moving peace process: "Today is a historic day ... The trade volume will increase."
The South Asian neighbours, who claim Kashmir in full but rule in parts, have fought two wars over the region and were on the verge of a third in 2002 before pulling back from the brink.
Tuesday, white doves of peace were released as 14 Pakistani trucks bedecked with the national flag crossed a bridge into Indian Kashmir carrying rice, onions and dried fruit.
Schoolchildren chanted "Long Live Pakistan" and "Kashmir will become a part of Pakistan" as a brass band played patriotic music.
"A DREAM COME TRUE"
Indian trucks garlanded with marigolds and banners reading "long live cross-border trade" set off the other way loaded with apples, honey and nuts.
"I'm delighted, it's a dream come true," said 35-year-old lorry driver Gulam Hassan Baba.
It was the first time vehicles had been allowed across the cease-fire line and the newly constructed Aman Setu, or Peace Bridge, since a 1948 war.
The opening of trade in Kashmir is the latest in a series of tentative peace moves that have done little to resolve their central territorial dispute, which has for decades hobbled regular trade across their international border further south.
But it does go some way towards meeting one of the demands of separatist groups in Indian Kashmir, who have been leading months of anti-India protests, some of the biggest in years.
India has moved slowly on opening up Kashmir's borders, believing that they could boost separatist militant attacks on Indian forces from bases in Pakistan. Militants have been battling security forces in Indian Kashmir since 1989.
A bus service connecting Srinagar, Indian Kashmir's summer capital, and Muzaffarabad, capital of Pakistani Kashmir, was launched in 2005, one of many confidence-building measures undertaken since the two sides began a peace process in 2004.
But because of elaborate security checks, suffocating bureaucracy and mistrust, only 9,000 passengers have travelled between the two sides of Kashmir on the "peace bus" service.
For the time being, trade will take place just once a week, with a limited list of goods allowed. Khuwaja Farooq, head of the Muzaffarabad Chamber of Commerce, said he wanted free trade.
"It should be a permanent feature ... but as of now, nothing seems permanent," he said.
(Additional reporting by Sheikh Mushtaq; Writing by Robert Birsel; Editing by Alex Richardson)
http://www.iht.com/articles/reuters/2008/10/21/asia/OUKWD-UK-KASHMIR-BORDER.php



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Pakistan considers [farm] asset sales to bolster economy (IHT)

NEW DELHI: Pakistan plans to sell valuable energy assets, beginning with a major gas field, as it tries to reap billions of dollars from deals with investors in industries like banking and farming. The list of state assets for sale may not necessarily be followed by deals, analysts warned.

"Talk of investing huge sums of money doesn't always materialize, because people are put off by the political machinations" in Pakistan, Price said.

Pakistan's "economic curse" is that the ruling elite — civil servants, politicians and the military — have worked in their own interest, not that of the wider population, limiting how much capital the country can raise, he said.

One possible source of new investment is the Middle East.

"There is a cultural and long-term affinity between the two regions," said Youssef Nasr, the chief executive of HSBC in the Middle East. Saudi Arabia and Abu Dhabi, in particular, have been strong supporters of Pakistan.

Investors from the Middle East have already bought stakes in telecommunications, banking and industrial companies in Pakistan and have been pleased with the results, he said.

One area of cooperation between Pakistan and the Middle East may be agriculture. The arid climate of the Middle East, coupled with rising food prices, has ignited fears about food security. Pakistan, meanwhile, has swaths of arable land that is lying fallow. Government officials on both sides are exploring links that could lead to joint farming ventures, Nasr said.

"It's not going to be a huge industry, by international standards," he predicted, but it could be large enough to make a difference to Pakistan's economy.



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Hunger brings anguish for millions of Pakistanis

THARPARKAR, Pakistan: When Pakistani labourer Mangal Ram's children cry from hunger all he has to offer them is empty promises.
"My kids complain and cry for more food but what can I do?," said Ram, 50, a father of seven who lives in the desert village of Tharparkar, in the southern Pakistani province of Sindh.
"We say 'wait, we'll cook more', what else can we do?" he asks with a shrug.
Ram's anguish is becoming increasingly common in Pakistan where inflation is running at about 20 percent, led by fuel and food prices.
Soaring food prices and shortages of staples mean about 77 million people of Pakistan's 160 million population are food insecure, a 28 percent increase over the past year, according to U.N. World Food Program (WFP) estimates.
http://www.iht.com/articles/reuters/2008/07/11/asia/OUKWD-UK-PAKISTAN-HUNGER.php




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