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ADB to allocate $40 million for development of agriculture in Kyrgyzstan

The Committee on International Affairs, Defense, Security and Migration of the Parliament of Kyrgyzstan approved the ratification of a loan agreement between Kyrgyzstan and the Asian Development Bank on the project «Development of climate-resilient value chains in agriculture» and a grant agreement between Kyrgyzstan and the Asian Development Bank on the project «Development of climate-resilient value chains in agriculture», signed on December 13, 2023 in Bishkek.

According to the Deputy Chairman of the Cabinet of Ministers — Minister of Water Resources, Agriculture and Processing Industry Bakyt Torobaev, the amount of the project is $40 million: a preferential loan and a grant — $20 million each, co-financing from the Cabinet of Ministers — $850,000. The loan term is 32 years. The grace period is eight years. The rate is 1 percent per annum during the grace period and 1.5 percent per annum thereafter. The number of payments is twice a year.

Bakyt Torobaev emphasized that trade and logistics centers, warehouse owners, primary processors, procurers, aggregators, logistics companies, and other subjects of fruit and vegetable production chains will be able to borrow loan funds.

Deputy Gulya Kozhokulova asked why only Aiyl Bank OJSC will finance loans and how accessible they will be to agricultural producers.

Deputy Minister of Finance Ruslan Tatikov said that one of the signs of choosing Aiyl Bank is the extensive network of the bank, which has offices in all regions of the country. «Out of $36 million, only $23 million will be provided through Aiyl Bank, the rest of the funds will go through other banks,» he said.

It is noted that borrowers will be able to get a loan for ten years at 8 percent per annum.

Following the discussion, the bill was approved in the first reading.

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