14 Aug 2009 18:19

Russian Agriculture Bank, Rosagroleasing to extend loans to drought-affected farms

SOCHI. Aug 14 (Interfax) - Russian Agriculture Bank (Rosselkhozbank) and Rosagroleasing have decided to extend short-term loans for farmers who have been affected by this year's drought, Agriculture Minister Yelena Skrynnik said on Friday at a session of the council charged with realizing priority national projects and a demographic policy.

Speaking to Prime Minister Vladimir Putin, Skrynnik said, "Lending institutions have fulfilled your instructions on providing state support to agricultural producers who have suffered from the drought by prolonging short-term loans for up to one year. Rosselkhozbank and Rosagroleasing have passed decisions."

"As for the issue of subsidizing the extended loans, a corresponding draft decree has been prepared," she said.

First Deputy Prime Minister Viktor Zubkov, for his part, said "just prolonging the loans won't be enough here." A special group that will provide aid to regions affected by the drought will start working next week and will include representatives from the regions, ministries and agencies. Zubkov said such support should allow loans for those who only produce grain to be extended by up to three years and not just by one year. "Rosselkhozbank and Sberbank have already begun work on this," he said.

"Commodity loans backed by grain for up to three years" could also help alleviate the situation, Zubkov said. In addition, the Agriculture Ministry needs to start setting up a support fund with funds envisioned as insurance, he said. "If we do this slowly, our indicators could be seriously impaired, both this year and next," he said.