The Federal Government and Nigerian banks have concluded plans to share 70 per cent loans on seeds and fertilizer.
President Goodluck Jonathan made this disclosure during his latest joint address to the National Assembly in Abuja, the federal capital territory on the 2012 budget.
He said that in order to unleash the potential of this sector, the Federal Ministry of Finance has put in place a mechanism to share risks with the banking sector by guaranteeing 70 per cent of the principal of all loans made for supply of seeds and fertilizer by the private sector.
NaijaAgroNet gathered that Jonathan noted that to get the inputs to farmers at an affordable cost, the Federal Government is subsidizing the interest rate on these loans to bring it down from 15 per cent to 7 per cent per annum.
The Minister of Agriculture and the Central Bank, President Jonathan said, would be collaborating to extend these services for credit availability for the medium term.
“We are introducing further fiscal policy measures to support the development of the agricultural sector,” he declared.
Pointing out that in this respect, the duty on machinery and certain specified equipment for the sector will, effective January 31st 2012, attract zero duty.
“We will further look at supportive fiscal policies for the rice and wheat sectors to stimulate domestic production,” he said.
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