At Netafim, many of our efforts to drive mass adoption of drip irrigation include making drip accessible to smallholder farmers. Over the years, as awareness has grown, farmers have overcome their suspicion of new technologies and now understand the benefits of using more advanced systems. However, in many cases, even a very small initial investment is more than smallholder farmers, often living below the poverty line, can afford. Netafim has developed special solutions, such as the Family Drip System™, to make irrigation more accessible and more inclusive.
Empowering small enterprises is a key element of UN SDG Goal 8. According to the FAO, 1.5 billion people live in smallholder households. The FAO states that many of those households are extremely poor and the highest incidence of workers below the poverty line is associated with employment in agriculture. At the same time, smallholders provide up to 80% of the food supply in Asian and sub-Saharan Africa.
In India, we have developed a creative solution to enable smallholder farmers to acquire drip systems. In 2013, we established NAFA – Netafim Agricultural Financing Agency, a non- banking financial company (NBFC). NAFA is majority-owned by Netafim (51%) with two partners – Atmaram Properties Pvt. Ltd., an Indian real estate group, and Granite Hill India Opportunities Fund, a private equity fund. NAFA complements our activities in India by providing financing solutions and issuing loans to smallholder farmers who otherwise could not afford the initial investment in drip.
By the end of 2015, we had distributed more than $25 million in loans to more than 13,000 smallholder customers in 8 States in India in 92 separate Districts. The irrigated area covered by loans that NAFA granted to smallholders is more than 15,000 hectares -around 40,000 acres. That’s much more than the size of a large city such as Paris or Barcelona.
Our experience in India and data from an Indian government survey has shown that the use of drip irrigation in India translates to an additional $850 in annual profit for each farmer in a country where the average national per capita income in early 2014 was $1,140. Add to that the ripple-effect throughout the economy and the improvement in the quality of life for communities and you get a very significant boost to achieving UN SDG Goal Number 10.
Read more posts in our “Advancing the SDGs” series.