The announcement last week by the Indian government that it is exploring venturing into production of pulses in Malawi and other African countries spells an opportunity for scaling-up legume production and export as well as irrigation farming in this country.
A delegation from India is due to visit African countries in July ahead of the Indian Prime Minister’s visit to Tanzania, South Africa, Kenya and Mozambique later in the month to look at ways of venturing into contract farming in and importing of legumes from Malawi, Mozambique and Tanzania.
The Indian government says exploring the option of farming in these African countries is a long-term strategy and that it would embark on the project in partnership with private sector players.
Indians consume a lot of pigeon peas but the country is now unable to produce adequate quantities for itself and now imports huge quantities from Malawi and other African countries to supplement local production.
However, reduced output due to drought in various parts of the world have resulted into spiraling prices for many agricultural commodities, including pigeon peas, and the Indian government is trying to control prices by venturing into indirect farming in Africa.
This should be good news for Malawi as it provides an opportunity for increased production and export of the crop. It could also boost the Greenbelt Irrigation Project as continued effects of climate change in Malawi mean viable production of the crop as wanted by the Indian government cannot be sustained without irrigation farming.
The proposal also provides an opportunity for value addition as the Malawi government could negotiate for provision of machinery for processing of the pigeon peas so that they are exported to India as finished products as several companies such as Export Trading Group are already doing.
Obviously, the Indian government won’t buy huge pieces of land in Malawi and start growing the crop on its own. It will instead engage Malawian farmers and companies to grow the crop on contract, with a guaranteed market and even prices for the crop.
Through what is called Forward Contracts, the Indian government could provide soft loans and technology for the cultivation of the crop to the Malawian farmers to help them increase volumes and reduce the cost of production per hectare by the farmers.
The farmers would then sell the commodity to the Indian government through the commodity exchange system already operating in Malawi which provides transparency in the trading and exporting of commodities for ease of tracing and receipt of full export proceeds into the country by authorities.
The commodity exchange system also ensures that producers are paid their dues, loans are serviced, taxes are settled and commodities are delivered in the right quantities and quality.
Through increased volumes and value addition, both Malawi and India could benefit from the venture. While India could benefit from reduced costs that come with efficient production and large scale production, Malawi could get its share of the cake not only through cheaper capital and machinery but also through more earnings from large volumes and high prices from value added product.
Malawi should therefore jump at the opportunity offered by India by making sure that the venture gets underway as envisioned by the Indian government while securing Malawian interests in the prospective deal.
With the Indian government now operating an embassy in Malawi, it should be easier for Malawi government officials to follow up on this proposal and ensure that things get on the ground as soon as possible.
Malawi desperately needs ways of boosting its agriculture and export earnings and should not hesitate when chances like these come dangling. Let’s allow India to help us develop the Greenbelt project while also providing us with markets for our pigeon peas to be produced under the project alongside other food crops we consume ourselves
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