DUSHANBE, April 25, Asia-Plus – Tajik authorities are taking efforts to mitigate high debt burden of cotton farmers and plan to announce farmland free for marketing, Murodali Alimardonov, Chairman of the National Bank of Tajikistan (NBT), remarked at a news conference in Dushanbe on April 25.
Alimardonov said that as a result of falling harvests in recent years, Tajik cotton farmers now owe $402 million to domestic and foreign creditors.
The debt was incurred by cotton farms under a complex system of production credit from intermediaries outside the formal banking system.
The central bank head said that the government jointly with international financial institutions, including the World Bank (WB) and the Asian Development Bank (ADB), will work on mitigating this high debt burden. “We are currently discussing a mechanism to set up a special agency that will assume resolution of the cotton farm debt,” Alimardonov said, noting that a fund will be set up at the agency with participation of international financial institutions. The fund will partially repay the cotton farmers debt to their creditors, according to him.
Besides, a land reform will be carried out in Tajikistan and amendments will be made to the country’s Land Code, the central bank head said. “Due to these changes, farmers will get certificates for using lands,” said the NBT head, “In this case, they will have the right to sell their lands.” He further added that state remains owner of land and in the case of necessity, it may purchase the plot of land from a farmer or offer him another one in exchange for his plot.
The central bank head noted, “Production of cotton has become unprofitable business, entailing numerous losses.” “After making of amendments to the land Code, farmers will decide themselves what to sow and what to do,” Alimardonov said.
