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Cablegate: Afghan Agriculture Minister Upbeat On Ag Situation

VZCZCXYZ0001
RR RUEHWEB

DE RUEHBUL #3337/01 2910954
ZNR UUUUU ZZH
R 180954Z OCT 09
FM AMEMBASSY KABUL
TO RUEHC/SECSTATE WASHDC 2346
INFO RUEHRC/USDA WASHDC
RUEHIL/AMEMBASSY ISLAMABAD 8024
RUEHRO/AMEMBASSY ROME 5264

UNCLAS KABUL 003337

SIPDIS
SENSITIVE

DEPT FOR S/SRAP and SCA/A
USDA FOR OSEC; FAS/MICHNER AND FCAP

E.O. 12958: N/A
TAGS: EAGR EAID PGOV AF
SUBJECT: AFGHAN AGRICULTURE MINISTER UPBEAT ON AG SITUATION

1. (SBU) SUMMARY: Afghan Minister of Agriculture, Irrigation and
Livestock (MAIL) Mohammed Asif Rahimi discussed Afghanistan's better
than usual grain harvest and how to handle it, distribution of seeds
and other inputs, collaboration with donors, and rural economic
development with Coordinating Director for Development and Economic
Affairs Ambassador E. Anthony Wayne October 13. (Political aspects
of the discussions were reported reftel.)

2. (SBU) Specific issues Rahimi also noted included his ministry's
efforts to get the word out to Afghan farmers -- and
parliamentarians -- about the services MAIL offers at its
headquarters and provincial levels. Rahimi asserted the Afghan
public sees MAIL positively around the country, particularly
regarding the way that it is handling the wheat purchasing campaign,
although he noted the need for improved transportation and storage
capabilities. He also wants WFP to buy some of the bumper wheat
harvest and asked the USG to urge them to do so. The Minister noted
his vision of an expanded mechanism for donors to contribute to the
Afghan Reconstruction Trust Fund of the World Bank that could
subsume a number of smaller redevelopment projects in Afghanistan.
The Minister and Ambassador Wayne also discussed the next steps
regarding banning Ammonium Nitrate, which insurgents are using to
make IEDs; the Minister has already acted to ban use of ammonium
nitrate. End summary.

DELIVERING MINISTRY SERVICES
----------------------------

3. (U) Minister Rahimi plans to invite all 34 provincial
agricultural directors to Kabul for a workshop on the national
agricultural strategy. He also plans to have the provincial MAIL
agricultural directors available to meet with parliamentarians from
the areas these directors work in order to discuss services MAIL can
provide in those provinces. Some MPs accuse the Ministry of not
providing all the services it claims, and Rahimi said the
national-level meeting is a chance for the provincial directors to
explain the situation. If services are indeed not up to
expectations, Rahimi said corrective measures would be taken.

4. (U) The Ag Minister also noted the workshop would be an excellent
opportunity for the USG and other donors and development partners.
Ambassador Wayne added the event could be particularly important to
helping energize the districts and building a stronger Afghanistan
agricultural team, one that includes the international advisors, as
soon as the new government is formed. Rahimi agreed there would be
a new impetus once the energy that is now focused on the electoral
question can be redirected.

AMMONIUM NITRATE
----------------

5. (SBU) Ambassador Wayne raised the concern that ammonium nitrate
is being primarily used as an explosive in IEDs in Afghanistan, not
as an agricultural input. Repeating our appreciation for Minister
Rahimi's actions against use of ammonium nitrate, Ambassador Wayne
noted Defense Minister Wardak has agreed to convene an
inter-ministerial meeting to implement the ban that MAIL had put in
place. Rahimi said he had heard from other ministers about the
plans to meet. The Minister also noted the October IED explosion
near the Indian Embassy in Kabul probably used ammonium nitrate.
Ambassador Wayne pointed out other fertilizers (i.e., urea) could be
used as well to manufacture homemade explosives (HME), but,
according to the Embassy's understanding, doing so requires use of
other precursors, namely acids, which should also be monitored for
malicious intent. Rahimi quickly noted urea is hugely important for
Afghan agriculture and could not be banned or removed from the reach
of Afghan farmers.

BUMPER WHEAT CROP
-----------------

6. (U) Regarding the current wheat purchasing campaign, especially
given the difficult situation in the southwestern province of Farah,
Minister Rahimi noted grain purchases are going well, perhaps
unfortunately better than is the unloading and storage. Wheat
production in Farah, for example, may be greater than expected with
up to 50,000 metric tons in that province alone needing buyers.
Ramini pointed out mechanical limitations in the trucking fleet and
grain storage facilities prevent them from keeping up with the
larger than expected harvest this year. The Minister said MAIL has
contracted for 76,000 metric tons of wheat this crop year and over
40,000 tons have been delivered. He added the Ministry of Finance,
per a decision reached at the October 12 Cabinet meeting, added $8.5
million to MAIL's wheat purchasing budget. (Note: depending on the
price paid to farmers, this additional funding would allow for
purchases of about an additional 30,000 metric tons of wheat. Local
MAIL prices have been significantly higher than those the World Food
Programme will pay; the WFP prices are loosely based on prevailing
world market prices. End note.) Rahimi proudly stated this is the
first time in 32 years that Afghanistan's Government has carried out
a national wheat purchasing campaign. He reported that this effort
has a positive impact on farmers who see the Government doing what
it is supposed to be doing.

WORLD FOOD PROGRAMME: CAN'T THEY BUY MORE?
------------------------------------------

7. (U) Minister Rahimi stated while the GIRoA is doing what it can
to buy more of this season's crop, he would like the USG to urge the
World Food Programme (WFP) to buy more as well. According to the
Minister, WFP has committed to buying 20,000 metric tons of wheat
this year, but he would like them to buy additional quantities. He
asked that the USG weigh in with the WFP. Embassy Ag Counselor will
follow up with the WFP locally. (Note: the WFP works with the Farah
Farmers Union on wheat pricing and purchases. Again, the relatively
high prices MAIL offers make the WFP prices seem unattractive. It
was also interesting the Minster mentioned that 300,000 metric tons
could be taken off the market without negatively affecting the
market. End note.)

8. (U) The Agricultural Minster stated MAIL could buy the wheat on
WFP's behalf, letting WFP pay for it and use MAIL facilities and
purchasing mechanisms. The MAIL would run the program through
farmer cooperatives that would only charge one percent service
charge.

SEEDS OF CHANGE?
----------------

9. (U) Minister Rahimi also noted MAIL and International Relief and
Development (IRD, an implementing partner of USAID) are the major
distributors of wheat seed this fall. However, there are political
challenges. First, it is important that the face of wheat seed
distribution is an Afghan one. Secondly, he said it seems the wheat
seed distribution effort will not be able to cover all districts.
Rahimi reported he gets phone calls and complaints from governors
and parliamentarians that the wheat seed distribution program is not
covering everyone. Still, at least some districts in all 34
provinces will get some wheat seed; last year only half the
provinces received seed. The Minister continued that seed
distribution needs to be sensible and systematic, prioritizing
distribution to areas where winter sowing needs to take place now
before soils freeze. He said it is ironic provincial reconstruction
teams (PRT) and agribusiness development teams (ADT) supplied seed
first to districts that could have waited longer to receive the
wheat seed.

SYNCHRONICITY? USG WELCOMES IT
------------------------------

10. (U) Ambassador Wayne asked whether MAIL would resume holding
donor coordination. Minister Rahimi told said MAIL would indeed
restart those meetings once the political landscape becomes settled.
Ambassador Wayne went on to say that it would be particularly
useful for the diverse members of the now-functioning USG
interagency civil-military agriculture team in Afghanistan to have
regular meetings with the Ministry as well, perhaps monthly, to sit
together and ensure both parties are fully aware of progress, needs,
and plans. He added the USG is ready to sit down and discuss
assistance programs in areas like agricultural infrastructure,
micro-hydropower and other cross-cutting projects. It will be
important to have representatives from all those subsectors present
to contribute to the discussion.

11. (U) The Minister welcomed this close coordination with the USG
agriculture team and agreed to follow up on the idea with his
advisors. He also encouraged the U.S. participation at the weekly
MAIL activity review meetings held with agricultural project
implementers and that more of the USG implementing partners to
participate. Ambassador Wayne said he appreciated the opening and
would pass the invitation along to the appropriate Embassy offices.

BIG PICTURE RURAL FINANCING
---------------------------

12. (U) The Minister's final topic was rural finance. Research and
discussion is underway on the topic, the Minister said, but more
input is welcome. He added that MAIL has asked the Food and
Agriculture Organization (FAO) for an expert in farm credit to join
the team of advisors on this project; Rahimi is looking for
capitalization of $150 million with an estimated $10 million in
operating capital. Larger-scale producers and processors would be
eligible for this new instrument, according to Rahimi.
13. (U) The Minister also said MAIL is working with the World Bank
on a sector-wide umbrella scheme that would eventually subsume
smaller projects. The foci of such a program would be irrigation,
input supply chains, and markets. Having it under the World Bank
(Afghan Reconstruction Trust Fund or ARTF) would allow for easier
donor participation and coordination.

LEGITIMATE CLAIMS ON ACCOMPLISHMENTS
------------------------------------

14. (SBU) Ambassador Wayne also thanked the Minister for MAIL's
contribution to the District Services Development Working Group
(DDWG) process, noting the MAIL proposal stood out by articulating
the services and the modalities for delivery. He added the U.S.
hopes to have successful pilot projects at the district level
starting in targeted areas. Minister Rahimi replied he thought his
ministry's proposal was well thought out and touched on extension,
integrated pest management, irrigation, and livestock health
programs. He also said the MAIL proposal would be easy to
implement. Ambassador Wayne commended MAIL for looking at the
process in the proper light and for building the legitimacy of the
service system -- not trying to claim legitimacy by merely building
hard structures. It will take time, Rahimi said, but it will be
worth it in the long run. The important thing is that the work is
done by Afghans on the Afghan time line, something that could make
it a measure of legitimacy and of a functioning government.

EIKENBERRY

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