India has provided $150 million to Ghana as support for the Strengthening of Agriculture Mechanisation Service Centres (AMSECs) Project, and $30 million for the Rehabilitation and Upgrading of Potable Water Systems in Yendi.
The financing terms for the facilities are an interest rate of 1.50 per cent, with a repayment schedule of 20 years, a five-year moratorium, maturity period of 25 years, and grant element of 35.46 per cent.
The loan agreement was signed on Friday in Accra between Mr Ken Ofori-Atta, the Minister of Finance, and Mr Pushpesh Tyagi, India Exim Bank’s Representative.
In attendance were Dr Owusu Afriyie Akoto, the Minister of Food and Agriculture, Mr Birender Singh Yadav, the High Commissioner of India to Ghana, and Mr Patrick Boamah, the Deputy Minister of Sanitation and Water Resources.
Mr Ofori-Atta noted that the facility would improve availability and timely access to affordable agricultural machinery and equipment and mechanised services for operations through the establishment of at least one AMSEC in each district.
“It is worth to note that the 150 million dollars for the AMSECs from the Government of India represents the largest concessional loan for the agriculture sector in any African country,” Mr Ofori-Atta said.
He said the AMSECs Project would provide mechanised services to the resource constrained households who could not afford their own machinery/equipment.
Mr Ofori-Atta said households who crop less than two hectares of land would have the opportunity to increase their average land holding to about five hectares.
He noted that this would gradually allow for a movement from small holdings to medium and large scale or commercial agriculture and also support the Government’s Planting for Food and Jobs Policy.
The project would support the establishment of cottage industries/small factories for processing of rice, maize and cassava.
It would also support cottage machine shops for fabricating small farm tools and equipment in support of the Government policy initiative of One District, One Factory for job creation.
“Government is working towards ensuring that by the year 2030 all people living in Ghana would have access to potable water. Consequently providing potable water to more than 133,000 people in the Yendi Municipality is a significant step towards achieving this goal,” Mr Ofori-Atta said.
He said the access to potable water to the people of Yendi would contribute to the maximisation of social and health benefits of clean, safe and reliable drinking water.
Mr Ofori-Atta lauded the warm cordial relationships that had existed between the two nations right from Ghana’s independence.
Mr Tyagi said the agriculture sector project would help improve the livelihood of small holder farmers whilst the water sector project would ensure that the people of Yendi got potable water.
He hailed Vice President Dr Mahamudu Bawumia’s recent visit to India, which led to the materialisation of the two loan facilities.
Mr Yadav said India had been a reliable and steady partner to Ghana in her developmental journey towards socioeconomic growth, which was guided by the Principle of South–South Cooperation.
He said the agriculture project would go a long way to augment Ghana Government’s flagship programme; Planting for Food and Jobs (PFJ).
Dr Akoto, on his part, described the agriculture credit facility as very historic, because it was by far the biggest infusion of farm machinery into agriculture in Ghana.
He said the facility could not have come at a better time because Ghana was in the middle of a major policy push; the PFJ, for the transformation of agriculture and the economy.
Dr Akoto recounted that from 2004-2008, under a similar engagement between Ghana and the Exim Bank of India, 76 agriculture mechanisation centres were established, but none was functioning now due to the lack of maintenance.
He said the challenge now was how to revive the 76 centres and also expand to other districts.
Mr Patrick Boamah, the Deputy Minister of Sanitation and Water Resources, noted that the Yendi Water Project would be extended to cover communities enroute to Yendi.