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Government to expand instalment system for farming equipment

By Htoo Thant   |   Friday, 27 January 2017

The agriculture ministry is collaborating with private firms to help farmers facing a shortage of animals and labour purchase machinery on instalment.

U Ko Ko Maung, director of the Agriculture Mechanisation Department under the Ministry of Agriculture, Livestock and Irrigation, said that farmers are working to cope with a changing climate that is altering planting and harvesting times. But a lack of labour and animals make it hard from them to respond quickly enough.

“There’s still not enough mechanisation in the farming sector,” he said. “Hired hands and cattle [for transport and ploughing] are becoming scarce, and farmers have difficulty buying expensive tractors.”

Purchasing expensive equipment like a tractor often requires upfront payment, and tractors are not cheap. Most new tractors cost between K20 million and K30 million, a sum the average farmer cannot afford, said Ko Myo Lin Aung, a farmer from the Nay Pyi Taw’s Pyinmana township.

The mechanisation department, however, is making tractors available with just a 10 percent down payment.  

“At over K20 million tractors are not something that a normal farmer can afford,” said Ko Myo Lin Aung. “Only those farmers who own many acres of lands can buy such things. But now, with only 10pc of the total price as a down payment allowing use of the machine I’m quite intrigued.”

The firms the mechanisation department has reached out to include Shwe Htwet Toe Company, Farmers Choice Tractor Company, and Convenience Prosperity Company. All three have sold tractors to farmers through the department on a 10pc down payment. The farmers are also free to hire out their new tractor to fellow farmers, U Ko Ko Maung added.

“You can operate it on your own farmlands, or even rent it to someone else,” he said. “So, theoretically, you can pay off your instalment money from renting it to someone else. This kind of method will be effective for the owner, and he will be able to own the machine too.”

U Ko Ko Maung said the remaining 90pc will be paid off through six equal instalments paid semi-annually over three years.

The system started in October last year with only tractors available to purchase. Out of the 190 tractors made available only 17 tractors were sold in the first two months, but the system is still in the observation stage, he said.

The authorities are monitoring any potential issues that might arise between the firms and the farmers, and if all goes smoothly combine harvesters will also be made available on the instalment scheme, said mechanisation department deputy director U Tun Tun Win.

“There are negotiations going on with related companies to extend the system to include combine harvesters. It won’t just be tractors,” he said.

Most of the tractors bought across Myanmar are in the regions of Ayeyarwaddy, Yangon, Bago, Sagaing, Magwe, and Mandalay.

Translation by Win Thaw Tar and Kyaw Soe Htet

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