NDF allocates $1b in facilities to Agriculture Ministry for ensuring food security

TEHRAN – The head of the National Development Fund (NDF) announced the allocation of one billion dollars in foreign currency facilities to the Ministry of Agriculture to strengthen strategic reserves and ensure the country's food security.

According to IRNA from the National Development Fund, Mehdi Ghazanfari, the head of the National Development Fund, stated in a meeting with Gholamreza Nouri, Minister of Agriculture, which was held at the Fund's headquarters with the presence of board members and a group of deputies from both institutions, that the National Development Fund has agreed to the Ministry of Agriculture's request for one billion dollars in line with strengthening strategic reserves and upgrading the infrastructure for supplying agricultural products.

Ghazanfari noted: At the National Development Fund, we are committed to supporting vital sectors, but at the same time, we emphasize the principle of return on investment and optimal resource management; therefore, this agreement has been made within the framework of commitments for the return of resources so that, in addition to ensuring food security, the sustainability of national assets is also maintained.

Continuing the meeting, Gholamreza Nouri, Minister of Agriculture, while outlining the ministry's operational challenges over the past 14 months, emphasized the need to change the approach to financing the agricultural sector and strengthen self-sufficiency in essential commodities.

At the beginning of his remarks, the Minister of Agriculture, referring to the issue of divestitures under Article 44, stated: Although the transfer of responsibilities is on the agenda, studies on economically stable countries show that the governments of these countries manage a significant portion of the essential commodities market through state-owned trading companies to ensure market regulation and food security.

Referring to the need to maintain and replenish the country's strategic reserves in the current situation, the Minister of Agriculture announced: For this purpose, a request for 1.7 billion dollars in facilities from the Fund's resources had been raised, for which approvals of up to 1 billion dollars are currently foreseen.

In another axis of this dialogue, Nouri emphasized the need to monitor the distribution of bank facilities in the agricultural sector and stated: In order to fully absorb financial resources and increase the investment rate in the agricultural sector, the granting of bank facilities in this area must be done with the introduction and approval of the Ministry of Agriculture so that priorities are based on actual production needs.

At the end, Nouri, while appreciating the support of the Board of the National Development Fund in allocating facilities for supplying essential commodities, especially during the third imposed war, emphasized that the ultimate goal of attracting new investments and strengthening food security is to reduce the final cost of products and narrow price gaps so that all segments of society can easily achieve food security.

Ghazanfari, head of the National Development Fund, in response to the Minister's remarks, while appreciating the efforts of the Ministry of Agriculture, emphasized the importance of strengthening the economic "home front" for success on the front line and noted that providing food for the people and establishing justice in the distribution of resources are among the main priorities.

Subsequently, Reza Mohammadi, Deputy for Investment and Financing of the National Development Fund, presenting statistical and detailed reports on the Fund's performance in the agricultural sector, stated: Since the beginning of the Fund's activities, a total of 118,000 projects in the fields of water, agriculture, and agricultural processing and complementary industries have been financed from the Fund's resources through Rial deposit contracts.

He added: In addition to the Rial facilities provided so far, 6 foreign currency projects introduced by the Ministry of Agriculture amounting to 170 million dollars have been financed.

The official clarified that the Fund has not set a "foreign currency ceiling" for the Ministry of Agriculture and is ready to finance all projects introduced by the Ministry (if eligible).

Also, Akbar Fathi, Deputy for Planning of the Ministry of Agriculture, at this meeting, while emphasizing the need to operationalize the agreements between the Ministry and the Fund, noted that despite the Fund's willingness to support production, we have faced structural obstacles and a lack of cooperation from some banks at the implementation stage.

He emphasized: Accordingly, it has been proposed to create a mechanism whereby the Ministry and the Fund, as trustees, can monitor the process of resource absorption in banks and, if applicants are unable, immediately introduce substitute applicants to prevent the accumulation of resources.

The Deputy for Planning of the Ministry of Agriculture, stating that unlike previous years, the necessary attractions for investment in agriculture have now been created, said: The Ministry of Agriculture announces its readiness to introduce foreign currency projects, especially in the field of processing and complementary industries, to be financed from the Fund's unlimited resources.

EF/MA