Staff Reporter :
The Bangladesh Bank (BB) has taken a scheme of Tk 1000 crore loan to increase the production of wheat and maize as the price of flour has suddenly hiked in the country due to the ongoing Russia-Ukraine war.
The relevant stakeholders have to import huge quantity of wheat and maize every year to maintain the normal supply in the country, which need to spend a significant amount of foreign currency.
According to BB guidelines, landless, small and marginal farmers as well as share-croppers in Bangladesh could be given loan up to Tk two lakh without any collateral under the central bank’s Tk 1,000 crore loan under refinance scheme aimed at boosting wheat and maize production to tackle the situation. The Bangladesh Bank on Thursday published the guideline on implementing the scheme that also looks to cut the reliance on imports.
According to the guideline, despite higher demand, the local production of wheat and maize is not adequate. As a result, the country has to import a significant volume of cereals to ensure a smooth supply of the products and the items produced from them.
Under the circumstances, a decision to unveil a Tk 1,000 crore refinance scheme has been taken and the scheme will run until June 2025, said a circular signed by Abul Kalam Azad, Director of the Agriculture loan division of BB.
Under the scheme, banks would receive funds at a 0.50 per cent interest rate from the central bank. The interest rate at the farmer’s level would be a maximum of four per cent in simple interest terms.
Banks would have to disburse the loans directly among the borrowers through their networks and give priority to the areas suitable for wheat and maize cultivation.
Landless farmers, who own less than 0.494 acres of land, small and marginal farmers, who own 0.494 to 2.47 acres of land, and share-croppers could be given loans up to Tk 2 lakh without any collateral.
The loan given under the scheme can’t be used to adjust old loans, said the BB.
Among the banks covered under the Agricultural and Rural Credit Policy, interested banks will have to need a participation agreement with Bangladesh Bank to avail loan facility under the scheme.
Funds will be allocated to the contracted banks on the basis of fiscal year-based needs.
