AKIA to provide up to 60% loan guarantees for modern irrigation systems
Nazrin Abdul
Read moreThe Agrarian Credit and Development Agency (AKIA) plans to offer up to 60% guarantees for loans provided by banks to finance modern irrigation systems under the food wheat pilot project.
Azernews reports that this announcement was made by Emil Khasanmadov, Deputy Head of AKIA's Credit Department, during a roundtable at the Agribusiness Development Forum in Baku.
Khasanmadov highlighted the challenges in agricultural lending, noting that the total volume of loans directed to the sector remains relatively small. He attributed this to the high risks associated with agricultural loans.
To address these challenges, AKIA is exploring mechanisms such as interest subsidies and loan guarantees. The agency intends to provide up to 60% guarantees for loans allocated to finance irrigation systems within the framework of the pilot project. Additionally, AKIA plans to cover a significant portion of the loan interest.
He also mentioned that another issue in financing is the lack of a unified platform to manage funds. AKIA is currently working to resolve this challenge.
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