More funds can be directed for boosting agricultural sector

The Islamic Corporation for the Development of the Private Sector will commence allocation of new financial sources to Muslim countries, including Azerbaijan by late 2016 via new Food and Agribusiness Fund.

The Fund made a relevant presentation on April 27 within the framework of the inaugural session of the General Assembly of the Islamic Organization for Food Security and VII Conference of the Ministers of member states of the Organization of Islamic Cooperation on food security and agricultural development, Trend reported.

The ICD mission will visit Azerbaijan in May 2016 with a view to discuss the financing of potential projects in the agricultural sector via the Food and Agribusiness Fund.

The authorized capital of the Fund will amount to $600 million. So far, $305 million have been attracted from ICD and three other leading investment institutions of the Islamic world. The remaining part is planned to be obtained by the middle of 2016. Negotiations with financial institutions are being held in this direction.

The Fund will fully finance food supply chain and value chain in various agricultural fields such as production of resources needed for the given sector, for example: various chemicals and fertilizers, as well as, infrastructure, services, trade, logistics and others.

The Fund will generally focus on optimizing production of the companies operating in the agricultural sector, reduction of waste and inefficiency in logistics.

While investing, the Fund will consider several aspects in the targeted country such as investment climate, food and agricultural potentials.

The Fund will assist commercial and agro-industrial companies to increase profits and promote the development of the food industry and the agricultural sector.

It is worth to mentioning that the Islamic Corporation for the Development of the Private Sector functions in Azerbaijan since 2003. It mainly finances small and medium-sized enterprises in the country.

The corporation is the founder of Azerbaijan leasing company Ansar Leasing and co-founder of the Caspian International Invest- ment Company.

What’s more, agrarian sector is of great significance to Azerbaijan for reducing dependence on petrodollars.

Developing agricultural sector is one of the main tools for Azerbaijan to diversify its national economy, to boost food security of the population and to increase country’s export potential.

Previously, 2015 was declared as a year of agriculture by Azerbaijan’s government, and an action plan was adopted which provided stimulus for the development and modernization of agricultural sector.

Agrarian reforms and e-agriculture system has been applied to improve the efficiency and transparency of the sector.

The state has set a number of benefits for farmers as well. The producers of agricultural products were exempt from taxes other than for land.

Farmers and entrepreneurs have an opportunity to receive loans and seeds on favorable terms.

They also can receive fertilizers, equipment and breeding cattle through Agroleasing on favorable terms.