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holy rollers
karbala’s faith-funded businesses threaten smaller firms

Abbas Sarhan
In Karbala religion is big business. But for some time now, the religious authorities there have been moving into businesses other than faith - such as farming and transportation. Now smaller businesses say that…
7.11.2013  |  Karbala
Inside one of the high tech farms being run by Karbala\'s religious authorities.
Inside one of the high tech farms being run by Karbala\'s religious authorities.

The southern Iraqi city of Karbala is home to some of the most sacred sites for Shiite Muslims from right around the world; as a result the city draws millions of the faithful every year and religion is big business here, from hotels to tour operators to taxi drivers and restaurateurs.

But for some time now, the organizations that manage the various holy sites have been getting into other business projects too. Today, there are dozens of small and large-scale projects being run by committees from the religious shrines and as a result, the shrines are becoming business heavyweights in Karbala.

The special committees running these projects are linked to the most important shrines in Karbala – that of the Imam Hussein, grandson of the Prophet Mohammed, and the shrine dedicated to his brother, Abbas. The committees are composed mostly of clerics alongside their staff and professionals with relevant expertise. The finances for the shrines come mostly from donations from the faithful but they also get some money from the local government as well as upkeep from the Shiite Muslim Endowment, the body tasked with running Shiite mosques and shrines around Iraq.

Projects run by the shrines’ departments of development and investment include a number of large agricultural projects to the south of the city, that produce a range of different vegetables.

During a recent visit to Karbala, Iraq\'s Minister for Planning and Development Cooperation, Ali Yusuf al-Shukri, visited several of the religious authority’s projects. Al-Shukri was there to help launch construction of the brand new 52,000 square foot Al Kafeel garage building. Owned by the religious shrines, it will eventually house a petrol station and mechanic’s workshop for ordinary cars and heavy machinery as well as parking and other facilities; it will be built at the cost of about US$62 million.

According to the Ministry of Planning’s website, their boss also toured a new US$5 million plant for the production of fertilizers, pesticides and other agricultural chemicals, which would be the first such plant in Iraq when it’s completed at the end of this year. Al-Shukri also visited a farm breeding a rare species of sheep as well as farmlands where ostrich, turkey, chicken and fish are being raised for local consumption.

Elsewhere the religious committees are supervising smaller projects, which include dairy production and the production of animal feed.

And although one of the senior managers involved was quoted as saying that they were on a mission to make Karbala the religious and commercial capital of Iraq, not everybody is happy with what’s happened here over the past few years.

Just 15 kilometres away from the shrines, a handful of independent farmers are fighting for their livelihoods. “The farming projects managed by the shrines depend on modern technology and when they’re ready, they will flood the markets with their agricultural products,” complained one of them who only wanted to be known as Abu Layth. “Small farms can’t afford to buy that kind of equipment. So the big farming projects keep making bigger projects and expanding.”

Additionally Abu Layth’s farm and other neighbouring farms are under threat from elsewhere too: located near Karbala’s airport, they are supposed to be being bulldozed soon because Iraq’s Ministry of Transport wants to build in this area. After protesting, the farmers were given until the end of the current season to clear their produce out and move.

Abu Layth believes this is yet another example of how the religious committees are able to succeed where the smaller landholders cannot. This would never happen to them, Abu Layth complains, they would be getting preferential treatment from the local authorities. “They have money and influence,” he notes. “After this move, small farmers will no longer have a role to play in this market.”

These kinds of fears are not limited to Karbala’s farming community either. Proprietors running buses and other transport around the city are also concerned about the religious committees’ fleet of vehicles.

“They are able to transport citizens at lower prices because they own more vehicles,” explains Ali Ibrahim, the owner of a bus, who drives passengers between the cities of Karbala and nearby Najaf. “This definitely affects my work and that of others like me because passengers will want to travel for less.”

The religious committees themselves don’t believe that people like Abu Layth or Ali Ibrahim have anything to fear from them.

“The aim of the agricultural projects - and even some of the other projects - is to be able to cover the shrines’ needs for food,” Saleh al-Mahdi, the engineer who heads the Imam Hussein shrine’s agricultural committee. “We provide hundreds of meals to visitors every day and we’re nowhere near self sufficient yet. So we’re still growing our production.”

Additionally al-Mahdi believes that the way they are going about developing the agricultural projects can only be of benefit to the whole region, if not the whole country.

“We’re importing equipment and we’re trying to overcome some of the local challenges with modern technology – these are challenges that the individual farmer could not overcome on their own,” al-Mahdi told NIQASH.

For example, Karbala has a lot of desert areas where water for agriculture is hard to come by, or expensive. Some of the most recent projects are introducing high tech equipment in order to extract ground water and to improve irrigation.

And finally the shrines’ representatives also say that if and when their products do reach the Karbala market, that it can only be good for local consumers – they will have more choice and better prices, thanks to competition, they conclude.

It’s true, that some smaller businesses driven out of the market, local economist Khaled Tayseer, concedes – especially if some of these big projects just keep getting bigger. It would be important to ensure that small businesses do survive as they too are important to the Iraqi economy. It’s also important not to treat any one party preferentially, Tayseer argues.

“There are some parties linked with the state, or who have a big influence with the state, and they’re able to access facilities like loans and import licenses much more easily,” Tayseer adds. “The government needs to ensure that its control and resource distribution is even handed so that one group doesn’t grow at the expense of others.”

On the other hand though, Tayseer continued, it’s not easy to monopolize the market in Iraq.

“For many years Iraq was dependent on exports from other countries for food and other products,” Tayseer says. “So today its domestic markets are still wide open and can still accommodate hundreds of different business options.”