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  NIRSAL, MECA to fix 10,000 grounded tractors

10th November 2017
in Business, Updates
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From Uche Usim and Obi Okwe, Abuja

The Nigeria Incentive-Based Risk Sharing System for Agricultural Lending (NIRSAL) on Thursday signed an agricultural mechanization management contract with the National Agency for Science and Engineering Infrastructure (NASENI) and Machine and Equipment Consortium Africa (MECA) to boost agri-business.

The synergy involves NIRSAL providing 75 per cent credit guarantee to enable NASENI and MECA repair 10,000 grounded tractors littered in various parts of Nigeria.

Speaking at the stakeholders’ concept forum in Abuja Thursday where the repair contract was signed, the Managing Director of NIRSAL, Aliyu Abdulhameed, described the deal as a “tractorisation project in which 10,000 abandoned tractors would be repaired annually”.

“For an average price of (let’s say) N12 million naira (the cost of a tractor), that will amount to about N120 billion worth of equipment that needs to be serviced. The deal would rake in N1.2 trillion into the Nigerian economy in 10 years”, he revealed.

According to him, every tractor to be repaired will be financed through the banks to the tune of N1.5 million, with NIRSAL providing up to 75 per cent of the guarantees.

“Already, 11 workshops are being built across the country to commence the tractor repair exercise nationwide”, he noted.

Abdulhameed, who described the project as one that would transform Nigeria’s agricultural sector from the 19th to the 21st century, pointed out that it represents a giant leap for the mechanisation of agricultural value chain in Nigeria.

The NIRSAL boss, however, lamented the poor maintenance culture of Nigerians, saying it was responsible for the high number of unserviceable tractors and other carcasses of mechanised farm equipment littered across the country. He said: “We have a serious problem in this country which can only be solved by cultivating a good maintenance culture.

“Statistics have shown that tractors do not last more than 12 months in Nigeria and after 12 months it goes into disuse. When nothing is further done to revive them, they gather dust and become obsolete.

“Our mandate is to provide an enabling environment for commercial banks to lend money to farmers and those that want to purchase tractors. Mind you, an average tractor costs N12million.

“Meanwhile, an average lifespan of a contractor for maximum productivity is between 25 to 30 years of purchase. Also, tractors work in prepared piece of land. So using a tractor for another purpose for which it was not made for is another problem.

“More so, the lack of effective business system is another setback for the country.

“For us to wriggle out of this problem and make farming attractive for all, we must train professionals to man various areas,” he explained.

Abdulhameed further stressed that a tractor, ideally, was supposed to service three hectares of land, adding that fixing them would create over 35,000 jobs for technicians, mechanics, drivers, among others.

Giving further insight into the project, he said, “it speaks for the primary production mechanisation particularly tractorisation and the density of tractor services in Nigeria agricultural primary production space.”

“NISAL is providing 75 per cent guarantee to the total amount that is required to be able to service 10,000 tractors every year for the next 10 years.

He described this as a big market, adding that the contract between NIRSAL on one hand and NASENI and MECA on the other represented a business-driven partnership.

Abdulhameed stated NASENI would be providing the technical support for the project, which is to cover the 36 states of the federation and Abuja.

He disclosed that the ultimate beneficiaries of the project were the states, noting that a move to get the states through their agriculture ministries for expression of interest was imminent.

NIRSAL, NASENI and MECA field team will soon jumpstart a census exercise to take an inventory of tractors that would come on the project, he said.

Ikenna Emewu

Ikenna Emewu

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