Investing in Agriculture Sector
Historically, Afghanistan enjoyed good reputation in cultivation of high-end horticultural crops such as raisins, pomegranates, pistachios and almonds, and possessed a large international market share. In the 1970s, Afghan-cut flowers graced tables from the Middle East to Europe. From India to Saudi Arabia and the Gulf, there is a great demand for Afghan table grapes. Now, it is entering a growing and sustainable international market for its high quality fruits.
About 85% – 90% population in rural areas is engaged in the agriculture sector which plays a vital role in the livelihood of 76% of the total population. It is responsible for about a quarter of the country’s Gross Domestic Product (GDP) in the recent years.
Following almost three decades of conflict, the government, farmers, and relevant stakeholders have worked hard to revitalize the agriculture sector. Rural economic development is among the highest priorities of the Afghan government. This also attracts development funds from a host of international donors. There is high emphasis on investment in agro-business and agro-processing as it has a huge positive impact on production and consumption of domestic products, and overall economic development of Afghanistan.
Agriculture Sector Contribution in GDP percentage
The current agriculture area of Afghanistan is 9,610 thousand hectares. Investment opportunities in this sector are further divided into sub- categories discussed below:
Horticulture: The raw products of horticulture are fresh fruits, vegetables, nuts and olives. Many fresh fruits and nuts produced in Afghanistan are of very good quality and are well known worldwide. In 2014-15, the total cultivation area of fresh fruits and vegetable was 257,435 ha and major fruits cultivated were oranges, citrus fruits, apples, pears, apricots, peaches, plums, berries, grapes, watermelons, melons, figs and more. Olives, for example, are cultivated on 2,200 ha and their production for 2012-13 was around 6,600 tons. Afghanistan is also a producer of good quality dry fruits such as raisins, almonds, walnuts, pistachios, and peanuts.
Grains & Cereals: Wheat and other grains are the main food crops in Afghanistan that are cultivated on irrigated & rain fed land. The growth in the GDP from agriculture products was between 3%-4% in 2014-15. In 2014-15, the domestic production for cereal products was 674,4259 tons while potato and beet production reached 351,587 tons.
However, the domestic production cannot meet the local demand; hence, Afghanistan imports cereals & grains in huge quantities.Animal Husbandry: Livestock is an inseparable part of agriculture sector. Traditionally, Afghanistan has been involved in livestock breeding for households, but in the past decade animal husbandry has become a vital sector for economic development of the country. Currently, there are 5.3 million cattle, 13.5 million sheep, and 11.1 million chickens. Other than domestic stock, Afghanistan imported 10,392 tons of milk powder, 11,747 tons of beef, and 42,300 tons of chicken meat. Afghanistan also exported 3,707 pieces of sheep and 1,907 tons of Kurk wool which is clear investment opportunity for private sector involved in the leather processing.
Seeds, Pulses, Spices & Medical Herbs: Oil seeds and pulses were cultivated on 154,594 ha in 2014-15 and Afghanistan exported 3,936 tons of these seeds during the same period. The country can produce watermelon seeds, alfalfa and clover seeds, sunflower, sesame, linseed and more. Similarly, 3,836 tons of spices and 11,766 tons of medical herbs were exported in 2014-15 while production of saffron, which is considered one of the best qualities in the world, was 3.4 tons with a cultivation area of 811 ha (4.2 kg production per hectare). Most of the domestic production of Afghanistan is exported to regional and international
Fresh fruits, vegetables, nuts, olive, etc.
- Cereals & Grains
Wheat, maize, surgar can, surgar beet, barely, etc.
- Animal Husbandry
Dairy, honey, poultry, meat, milk, fish , etc.
- Seeds & Pulses
Sunflower, sesame, linseed, etc.
- Spices & Medical Herbs
Saffron, cumin, anis , etc
Investment Opportunities in the Value Chain of Agriculture Sector
- Processing dry fruits & nuts
- Manufacturing of jams, juices, sauces
- Processing/manufacturing of olive oil & olive pickle
- Flour mills & sugar mills
- Production of potato snacks
- Manufacturing ofcakes and biscuits
- Producing pasteurized dairy products: milk, curd, yogurt, cheese
- Processing meat
- Processing dry meat
- Extracting and processing oils
- Establishing cold storages
- Production of cashmere and its garments
- Cotton processing and cotton yarn production
- Fresh anddry fruit boxes/packages
- Jars, lids, and tins
- Glass and plastic bottles
- Plastic wrappers
- Tetra-pack packaging
- Transport and logistic services
- Market identification services
- Trade partnership building services
- Marketing services
- Branding services