Gov’t seeks private sector financing for Ksh.598B irrigation plan

The government is seeking private sector investment to finance 61 per cent of the Ksh.598 billion National Irrigation Sector Investment Plan (NISIP) 2025–2035, aimed at expanding irrigation and strengthening Kenya’s food security.

Water, Sanitation and Irrigation Cabinet Secretary Eric Muriithi said public financing alone cannot meet the cost of implementing the 10-year plan, which targets expansion of irrigation to more than 1.5 million acres.

Speaking in Nairobi during the Eastern and Southern Africa Private Sector Forum on Irrigation, Muriithi called on commercial banks, development partners, equipment suppliers and agribusinesses to invest in the sector.

“Public financing alone cannot get us there, and it was not designed to. The NISIP is an instrument for rallying the whole sector including government, donors, commercial banks, equipment suppliers and agribusinesses, around one architecture, one accountability framework, and one set of outcomes,” said Muriithi.

The forum brought together representatives from 39 governments and private sector players to identify barriers and risks limiting private investment in irrigation.

The government is working with the World Bank and International Finance Corporation (IFC) to implement the Kenya Resilient Irrigation for a Sustainable Economy (K-RISE) programme.

World Bank Eastern and Southern Africa Division Director Qimiao Fan said the programme will provide financial solutions to address challenges facing irrigation investment.

“We are offering financial instrument solutions to help address some of the hurdles in the irrigation sector. We are here to begin a sustained outcome of job creation and farmer empowerment,” said Fan.

K-RISE will use three financing instruments to attract private capital. The Results-Based Finance Facility will provide rebates and grants to irrigation equipment dealers based on verified sales and installations.

The Risk Sharing Facility will provide first-loss and partial credit guarantees to banks, microfinance institutions and SACCOs offering irrigation-specific loans.

A Patient Capital Facility will support suppliers and financiers requiring longer repayment periods for irrigation investments.

The government has identified 10 irrigation schemes for a pilot programme covering about 14,819 acres and 52,115 farmers.

The schemes produce rice, maize, horticultural crops, vegetables, pulses, potatoes, onions and avocados.

The government also plans to strengthen farmer cooperatives and establish direct links with processors, exporters and other buyers to improve market access and returns for farmers.