WASHINGTON, Feb. 6: A newly-released status report shows that World Bank lending to the agriculture sector increased sharply to 2,1 billion US dollar in the last fiscal year (FY), reports the Bank on its home page.
With 65 new projects that had agriculture sector components, FY05 (July 2005- June 2005) lending showed a 40 percent increase over FY04 lending of 1,5 billion dollar.
Among agricultural sub-sectors, the irrigation and drainage sub-sector was the strongest, accounting for just over 1 billion dollar, or almost 50 percent of lending, and an increase of 300 million over FY04 figures.
– With 70 percent of the worlds poor living in rural areas and relying on agriculture as their major source of income, says Ian Johnson, World Bank Vice President for Sustainable Development, adding: – Strengthening the agriculture sector has strong implications for the growth of developing country economies.
This increase was led by a 700 million dollar increase in agricultural lending over FY04 levels in the South Asia Region, reaching 955 million dollar in FY05, mostly concentrated in two water projects in India – the “Maharashtra Water Sector Improvement Project” and “Madhya Pradesh Water Sector Restructuring Project” which accounted for 650 million dollar in sector lending.
Kevin Cleaver, Director of Agriculture and Rural Development, explains:
– After three years of implementation of the Banks new strategy, this report gives a sense that the trend of declining investments in this sector is being reversed. The prognosis for the future is a sustained level of lending, with further focus on low income countries.
Agricultural growth is the cornerstone of poverty reduction
In many poorer developing countries, agriculture is the principle source of overall economic growth. Agriculture employs nearly one-half of the labor force in developing countries. Indeed, a high share of rural communities and especially the rural poor are directly or indirectly dependent on agriculture through farming, food processing, fishing, forestry, and trade.
The Agriculture and Rural Development Strategy – Reaching the Rural Poor -, outlines a detailed program for reinvigorating the international communitys engagement in agriculture and rural development.
The Strategys main thrust is to integrate the needs of the rural poor in national policy investment programs. Simultaneously, it advocates to reform industrial country agricultural trade and aid policies.
For more information, see the website: www.worldbank.org/rural
Kilde: www.worldbank.org
