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Sunday 11 August 2013
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NDFI Contracts with  Banking System 36 Billion Dollars

NDFI Contracts with Banking System 36 Billion Dollars

Mohammad Reza Farzin, President and chairman of Board of Executive Directors of National development Fund of Iran explained the performance of the Fund. Based on him, the “supervision and Credit Deputy” supervises every single project and removes their problems. As of now, some 75000 billion Rials has been allocated to the projects, from which 15000 billion has gone to industry an...

Mohammad Reza Farzin, President and chairman of Board of Executive Directors of National development Fund of Iran explained the performance of the Fund. Based on him, the “supervision and Credit Deputy” supervises every single project and removes their problems.

As of now, some 75000 billion Rials has been allocated to the projects, from which 15000 billion has gone to industry and the remaining 60000 to agricultural sector. The Bank of Agriculture should add 40% to that amount and allocate to projects.

In 1390, based on the Annual Budget Law, 10% of NDFI resources converted to Rial and made available to the Bank of Agriculture and the Fund for Protecting Agriculture. These resources amounted to 34000 billion Rials which was combined with the resources of Bank of Agriculture and amounted to 50000 billion Rials.

In 1391, instead of 2 banks, NDFI entered into contracts with 8 banks. The projects should get the approval of the bank and then NDFI, prior to allocating resources to the bank, investigates and approves the projects.

In 1391, too, based on the Annual Budget Law, 10% of NDFI resources converted to Rial and made available to the Bank of Agriculture and the same happened for industrial projects. The trend continued for 1392 but it has not been allocated, since the mandated resources of 1391 have not been allocated fully yet.

Small number of projects from deprived regions come to NDFI, resulting in deepening the gap between developed and deprived regions. So we proposed a line to be included in the annual budget that 3 state firms: IDRO, IMIDRO and Industrial Cities Corporation (Sherkat Shahrakhaye Sanati) to enter partnerships with private sectors at 49-51 for implementing projects in deprived regions and enjoy NDFI resources in foreign and national currencies, but wasn’t approved. Now we consider quotas for each province to narrow the gap.

The interest rate for agricultural sector used to be 7% and now it stands at 13% which is very low. For industry it is 16% . the deprived regions may enjoy even easier loans.

NDFI is active in granting national and foreign currency loans as well as investing in foreign money and capital markets. NDFI has signed $36 billion contracts with agent banks of which projects worth some $21 Billion have been approved by the banks and introduced to NDFI. Albeit it does not mean that $21 billion has disbursed but shows NDFI commitments. In other words, 360 projects amounting $21 billion have been approved but disbursement is made step by step. As of last month, some $7.8 has been disbursed, creating 210000 jobs.

Investments are not made directly by NDFI (it is not authorized to) but through the agent banks.

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  • NDFI Contracts with  Banking System 36 Billion Dollars

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