Government improves program terms, expands the range of equipment provided under the state agri-food leasing support program
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A Cabinet meeting was held today, chaired by Prime Minister Nikol Pashinyan.
The Cabinet amended a previous decision on the need to provide state support for financial leasing of agricultural and food equipment in the Republic of Armenia in order to improve the state leasing support program’s terms and conditions and expand the range of leased equipment. Accordingly, it is proposed to expand the coverage of the program by supplementing it with equipment for breeding snails and cranes.
The amendment provides that the aggregate cost threshold of 450 million drams for equipment purchased by each lessee shall be raised to 1 billion drams under the program. According to Minister of Economy Vahan Kerobyan, the program seeks consolidation in agriculture, that is, it will help farmers undertake more sizeable projects.
Nikol Pashinyan hailed the program, noting: “From the very outset, we set a goal to make the agricultural support and development programs more effective. To this end, we have made drastic changes in the content of farm support tools. I can state that we had only 2 sectors where growth was recorded in 2020, and agriculture is one of them. I firmly believe that the program has a role to play in this process. For instance, nearly 9 billion drams were spent under the leasing program in 2020, with 950 units of equipment purchased by 576 beneficiaries. This is quite a high figure for the Republic of Armenia.”
The decision sets preferential conditions and a limit on the actual interest rates applicable to loans or lease contracts as specified in a number of decisions. Accordingly, it establishes that until December 31, 2021, the actual interest rate should not exceed 14% (previously 12%) on AMD-denominated loans or leasing provided by financial institutions under state support programs in the field of agriculture. At the same time, interest rate subsidies for loans or leasing shall be provided in the amount of interest rates set by loan or lease arrangements to ensure that the loans or lease contracts are available at 0% interest for economic entities.
With reference to agriculture-related decisions, Prime Minister Pashinyan noted that the topic of subsidized agricultural loans was the subject of heated debates and speculations on different platforms during the past year.
“Now, as the results have already been summarized, I would like to state that we provided a record number of loans in 2020. Moreover, six times more loans were extended in 2020 as compared to 2018. That is, 5782 loans were provided in 2018 against 36,608 loans available in 2020. The 2020 agricultural season was marked by harsh criticism: we were blamed for not giving loans to farmers, that the farmers did not get anything at all, and so on. In the meantime, the volume of agricultural loans tripled last year as compared to 2018,” the Premier said.
The Government decided to take back the premises and the plot of land located at 13/12 Isakov Avenue as attached to the State Property Management Committee and offered for free use to Yerevan Special Music School N13 with a view to alienating it through direct sales to Armenia Wine Factory LLC. The Company is implementing an investment program, which will result in the construction of the Digitown International Center for Innovative Technologies.
The Government made redistribution in the 2021 State budget and amended one of its previous decisions to allocate extra funds to the Ministry of High-Tech Industry in order to provide grants to the winners of the grant tender held in accordance with the decision “On Approving COVID-19 Response Activity 17.”
The Executive will soon make two decisions in the social sphere mediating a written procedure. One of the projects implies financial support for the citizens of Artsakh. Accordingly, AMD 68 thousand shall be provided in emergency assistance to the citizens of Artsakh for 4 months following March. The non-disabled male individuals aged 18-63 eligible under other incentive measures cannot be program beneficiaries.