Russia allocates additional funds to farmers
Russian Prime Minister Mikhail Mishustin signed a decree to allocate additional funds of 25 billion rubles (approximately $218.7 million) to implement the reduced-rate lending program for agricultural enterprises. This will help to subsidize new short-term loans of at least 158 billion rubles (approximately $1.4 billion).
“Some regions have already begun spring fieldwork. It’s important that the sowing campaign goes smoothly,” said Mikhail Mishustin.
The funds will be allocated from the government’s reserve fund and will be used to subsidize credit organizations that provide soft loans to the agro-industrial complex. The additional financing is needed due to an increase in the key rate by the Central Bank of Russia from 9.5% to 20%.
The preferential loan program for farmers was launched in 2017. The program allows agricultural producers to take a short-term or investment loan at a rate of up to 5% for the development of crop and livestock production, as well as for the construction and modernization of enterprises for the processing of agricultural raw materials. Preferential short-term credit is issued for up to one year, investment – from 2 to 15 years.
Earlier, the government approved a decree on credit holidays for farmers and prolongation of preferential loan agreements. Farmers received a six-month delay of payment on preferential investment loans, the contracts for which expire in 2022. Short-term loans, which also expire in 2022, may be extended for another year. Thus, agricultural producers will be able to reduce the amount of monthly payments and reduce the credit burden.