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Private investment seen crucial to rural development, experts say

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From left to right: Mekhala Krishnamurthy, William Dar, Shenggen Fan, Akmal Siddiq.

GOVERNMENTS need to find ways to attract private investment to rural communities, and need to recognize these communities’ potential for driving economic growth, experts told the Rural Development and Food Security Forum 2019 organized by the Asian Development Bank (ADB).

“Rural demand spurs growth… This is where agriculture becomes very important. Moving beyond, it’s not just thinking that urban (communities) trigger demand, but realizing that rural communities are huge consumers and they are very large,” Mekhala Krishnamurthy, head of the Sociology/Anthropology department of India’s Ashoka University, said during the forum Monday in Pasig City.

The three-day forum was organized by the ADB in partnership with the International Food Policy Research Institute (IFPRI) and the International Rice Research Institute (IRRI).

ADB is urging members to pay more attention to rural development and promote effective land and water resources management, thereby enabling sustainable food production.

“ADB will proactively assist our developing member countries to increase agricultural productivity and profitability, enhance food safety, and improve climate resilience and sustainability,” ADB President Takehiko Nakao said during his speech.

Ms. Krishnamurthy said that farms are facing a variety of risks which could spiral out of control if not handled properly.




“The frequency of risks has escalated and has become more common, but equally so has the complexity. This makes it extremely difficult for farmers (to) manage… It also makes it exceedingly challenging for those of us considering solutions to these kinds of risks,” she said.

These are some of the risk factors that also scare away the private sector from agriculture.

The risks make public sector-led intervention more necessary.

Akmal Siddiq, chief of Rural Development and Food Security Thematic Group under the Sustainable Development and Climate Change Department of the ADB, said that there is a need for smarter policy that will make agriculture attractive to private investment.

“Agriculture in just about every country is considered to be unsophisticated, less desirable, and not a very fancy sector to work in,” he said.

“What ADB would like to do under our strategy 2030 going forward is try to convince our member governments that they need to change their policy. Set out regulatory frameworks which would enable agriculture to become more profitable,” he explained.

Agriculture Secretary William D. Dar said governments need to assist firms in executing their programs for agriculture.

“What is the role of the government? We will be involved in training the farmers… enhancing that partnership between the big and small farmers. We will see to it that this will be replicated in other areas,” he said.

Shenggen Fan, director general of IFPRI, said governments should consider urban and rural areas to be part of one economy with no artificial boundaries between the two.

“How can we make sure that rural and urban areas are one? Number one is to improve infrastructure and policy,” he added. — Vincent Mariel P. Galang

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