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Azerbaijan to commence insurance of agricultural products

25 December 2019 [17:35] - TODAY.AZ

By Azernews


By Ofeliya Afandiyeva

Azerbaijan’s Cabinet of Ministers has signed a decision on agricultural products that are subject to agricultural insurance, the official website of the Azerbaijani Cabinet of Ministers reported in December 19.

At the initial stage of the procedure, wheat, barley, corn, potato and sugar beet will be insured in order to strengthen food security, reduce the dependence of the vegetable oil industry on sources of raw material import and support the development of sugar beet sector as well.

The second category includes orange, lemon, tangerine, tea, tobacco, rice, grape, hazelnut and cotton, which will be insured for the purpose of increasing import substitution and strengthening export potential.

As to livestock breeding, dairy cows and buffaloes up to seven years old will be insured to increase productivity and production indicators.

Initially, for products grown in water, fish insurance will be provided with the aim of increasing the share of local production in provision of fish products and stimulate the development of aquaculture.

The Agricultural Insurance Fund, which will take on 50 percent of the risks, will also be involved in the insurance of these products.

Joint insurance of the above-mentioned products by the Agricultural Insurance Fund and private insurance companies will reduce investment risks, strengthen the support of farmers and provide conditions for the expansion of production.

Moreover, insurance provision of agricultural products will contribute to employment, production growth in the mentioned products, stabilization in the market prices, food security and insurance market.

It is considered expedient to carry out this process in stages, which has never been done before in the country, taking into account international experience.

Along with this, the decision is related to the absence of sufficient experience of Azerbaijan in methodology of calculating tariffs in the agrarian insurance and assessment of insurance risks and damages.

Note that the Law on Agricultural Insurance was adopted in June, 2019 and in August 2019, Agricultural Insurance Fund was established by the decree of Azerbaijani President Ilham Aliyev.

Some $2.9 million was allocated to the state budget of the Agricultural Insurance Fund for 2020.

URL: http://www.today.az/news/business/189571.html

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