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U.S. Government Establishes Loan Mechanism for Purchase of Farm Machinery by Tajikistan

Saturday 27 October 2012

DUSHANBE (USAID press service) – The USAID Productive Agriculture Project and the Khatlon (ختلان) Region Administration hosted an event in Qurghonteppa (قرغان تپّه) to celebrate the purchase of over 50 tractors by farms in the 12 western districts of the Khatlon Region, the target area for the USAID Feed the Future initiative.

Access to machinery is essential for efficient and profitable agricultural production. A 2010 study by the International Finance Corporation using data from 2008 found that the number of tractors in Tajikistan had fallen to 43% of the 1991 level. According to World Bank data, in 2008 a total of 15951 agricultural machinery and tractors were used in Tajikistan which represents 215.3 units per 100 km² of arable land.
(Photo: courtesy of USAID)

U.S. Ambassador Susan Elliott and Regional Chairman Gaibulloh Afzal (غیب الله افضل) opened the event and presented ten dehghan (دهقان) with the keys to their new tractors. The event was attended by financial institutions, agriculture implement dealers, local district and jamoat (جماعت) authorities as well as many of the farmers who worked with the Project.

The USAID Productive Agriculture Project, in collaboration with Imon International and Eskhata bank, used a financing mechanism enabling farmers to access two-year loans for the purchase of tractors. Tractors were bought from the Madadi Tursunzoda farm machinery dealership with a combination of cash and credit. In addition, the USAID Productive Agriculture Project provided a grant of about 20% of the total cost of each tractor.

The goal of the USAID Productive Agriculture Project’s machinery credit program is to create a financial mechanism through leading financial institutions enabling farms to finance their machinery needs. The purchase of tractors celebrated at the event is an expansion of a 2011 pilot program between USAID Productive Agriculture Project and two other financial institutions, AgroInvestBank and Arvand. Farmers purchasing tractors are also working with a project to improve the production of winter onions in western Khatlon. This project is also intended to extend access to financing of machinery for smaller farms involved in orchard, vineyard, and hothouse vegetable production in this same part of the region.

The USAID Productive Agriculture Project in Tajikistan is an assistance mechanism set up by the USA through their Agency for International Development (USAID).

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