TAJIKISTAN: ADB to help cotton industry

DUSHANBE: The Asian Development Bank will help restore the productivity and profitability of Tajikistan's cotton industry through a loan and grant package totaling US$12 million; Neeraj Jain, ADB's Country Director for Tajikistan says.

The cotton industry is the country's main source of farm income, agricultural exports, and rural employment.

However, it has been underperforming, with yields and profitability on the decline, largely due to the substantial and increasing cotton farm debt.

This debt, estimated at $292 million in early 2006, was incurred by cotton farms under a complex system of production credit from intermediaries outside the formal banking system.

The Government has responded by developing a comprehensive Cotton Farm Debt Resolution Strategy, and the project will complement this effort.

Lourdes Adriano, an ADB Senior Rural Development Economist says: "An unprofitable cotton industry is inextricably linked to poverty".

Thus, there is an urgent need to support the recovery of the sub-sector. Its turnaround is the agriculture sector's path to equitable pro-poor growth; he says.

The project will first resolve cotton farm debt on a pilot scale in four selected districts in the two main cotton-producing regions - Sughd and Khatlon where three quarters of the country's extremely poor live; according to him.

A team will analyze the debt level and operations in each farm, then work to restructure and settle the debt. Realistic business plans for each farm will also be prepared.

The project will make policy recommendations and farm debt resolution options to the Government, and support education and awareness measures to provide suitable financing products and services to the restructured pilot cotton farms, at the same time, the Government will relend $3 million of ADB's loan to participating commercial banks.

The project will help to develop the cotton market by promoting the adoption of internationally recognized quality standards for fiber cotton.

It will also help establish two bonded warehouses to be operated by the private sector that meet international standards to expedite the export of baled cotton.

Through this project, ADB will support the Government's commitment to genuine development change by addressing the crucial and immediate concerns affecting the agriculture sector; says Neeraj Jain.

ADB's support comprises a $5.5 million loan and a $6.5 million grant from its concessional Asian Development Fund.

The loan carries a 32-year term, including a grace period of 8 years, and an interest rate of 1% per annum during the grace period and 1.5% per annum after.

The Government and private sector will shoulder the balance of $3.29 million, to meet the project's total estimated cost of $15.29 million.

The Executive Office of the President is the executing agency for the project, which is due for completion in 2010. 

Send your News/Releases for publication to [email protected]
Added: December 5, 2006 Source: Agencies
Start script - 1534513537.3066 Start news id check - 1534513537.3066 After news id check - 1534513537.3069 After cookie_code - 1534513538.13 Before news detail - 1534513538.13 After news detail - 1534513538.1307 Start cat select - 1534513538.1308 After cat select - 1534513538.131 before preg replace - 1534513538.131 After preg replace - 1534513538.1311 Before tag engine - 1534513538.1311 After tag engine - 1534513538.1347 Before mptt engine - 1534513538.1347 After mptt engine - 1534513538.1347 Before related engine - 1534513538.1347 After related engine - 1534513538.1365 Before update hits - 1534513538.1365 After update hits - 1534513538.1367 After update news_hits - 1534513538.1419 After mem_only_views - 1534513538.142 -------------------------------------------------- Total Exec time:- 0.83550000190735
AddThis Social Bookmark Button   Tell a friendBookmark AddThis Feed Button
Related News:

Website design by InWiz • © - 2000-2018. Internet Wizards All rights reserved. About usTerms & ConditionsDisclaimerPrivacy policy • 17-08-2018