DUSHANBE, September 27, 2013, Asia-Plus -- Tajikistan agricultural reform program designed for 2012-2020 says high credit risks in agriculture force most of banks in Tajikistan to conduct very cautious credit policy.  

The risk of outstanding loans reportedly brings to high extra charges applied to credits’ interest rates, and current interest rates exceed 17.5%.

The program, in particular, notes that the demand for loans is limited not only due to high interest rates but also due to heavy requirements applied towards pledges.  The agriculture receives very small volume of the existing limited credit resources because banks consider agriculture as a high risk sector, and because there are only few agricultural entities which are profitable enough to return debts.

“The objective of activities devoted to increase access to loans is to increase the financial sustainability of agricultural entities and dehqon (peasant) farms, including individual entrepreneurs and organizations. To achieve stipulated objectives, it is necessary to solve the issue of attraction of loans from commercial banks and credits from individual entrepreneurs and organizations, for the benefit of those entities, which are engaged into primary and subsequent processing of agricultural products, in order to help them replenish their current/ turnover assets, renew their fixed assets, and develop primary processing of products,” the agricultural reform program for 2012-2020 says.