Federal govt launches ‘Zarkhez-e’ program for small farmers

ISLAMABAD: The federal government has launched an agricultural credit program called ‘Zarkhez-e’ for 93 percent of small farmers and cultivators.

According to the Ministry of Finance, this is a collateral-free and digitally enabled agricultural credit scheme for farmers and cultivators who have been outside the formal financial system for a long time.

The Ministry of Finance says that this program is not a minor or incremental measure but a fundamental and structural correction.

Under this program, these 750 thousand farmers who were previously outside the system will be included in the financial system.

Under the program, there will be an inflow of Rs 300 billion into the rural economy in the next three years.

The condition of collateral in the provision of credit for these farmers has been removed so that the loan is given on the basis of capacity instead of land ownership and digital agronomy, satellite data and verified identification systems can replace red tape.

According to the Ministry of Finance, the agricultural credit system in Pakistan has historically prioritized scale over equity, with 7% of farmers accounting for 68% of total agricultural credit.

The new program seeks to make the system fairer. The program ensures financial inclusion with dignity and now provides collateral-free loans to farmers.

The target for loans is up to Rs 5 lakh for tenant farmers and up to Rs 1 million for land-owning farmers.

The program is structured on a regional basis and will equally cover farmers in Khyber Pakhtunkhwa, Balochistan, Gilgit-Baltistan, Azad Kashmir, and deprived areas of Sindh and Punjab.

The program will free farmers from exploitative middlemen, which will reduce poverty. Food security will be ensured through increased production through the provision of quality agricultural inputs.