Capital is one of the basic components of sustainable development of the any sector especially the agricultural sector. The share of appropriate investment in the agricultural sector in the country’s economy will make the infrastructure and groundwork affairs including irrigation networks, mechanization and Agro based industries to be in a favorable situation. This will also increase productivity and value added which help to make the agriculture sector reasonable and economic.
Therefore, funds to support the development of the agricultural sector as the only non-governmental financial-credit institution with the participation of producers and operators have been established, which show a clear vision to apply non-governmental capacities to finance and promote the growth rate of investment in the agricultural sector.
From 2004, 171 funds have been established at the national, provincial, county, natural resources and women levels. The mutual trust and confidence of the funds and their shareholders caused an increase in the capital of the funds within short period of time and their capital increased from 33 billion Rials at the beginning of its establishment to about 31000 billion Rials so far.
Since establishment (2004) until the end of November 2022, 171 funds to support the development of the agricultural sector at various levels have been formed including 32 provincial funds, 11 specialized-product funds, 20 rural and nomadic women funds, 13 natural resources funds and 93 county funds. The capital of these funds amounts to 31,000 billion Rials and the maximum share of government is 49% and the minimum share of the non-governmental sector is 51%.
The number of shareholders of these funds up to the mentioned period includes 8232 legal shareholders (in the form of organizations, cooperatives active in the agricultural sector) and 125,500 personal shareholders (producers of and active in agriculture sector).

Paid Loan:
The most important performance of the early years of the formation of the funds was the payment of about 14 thousand billion Rials of facilities with low commission rates. One of the prominent features of the granted facilities is that they are timely, easy accessible and low interest, and there is a system of self-control over the fund, which has made the funds have no arrears.
Since the establishment of the funds, more than 200,000 billion Rials in facilities have been granted to the target community in order to complete and strengthen the value chain as part of the working capital. The mentioned facilities have been provided to the shareholders of these funds, more than eight thousand organizations and cooperatives as legal shareholders and more than 128 thousand producers and operators as personal shareholders. Up to 78% of the mentioned facilities have been provided from the Funds in the form of Qarz al-Hasna with a commission of 4% and the rest from the other resources like banks according to the memorandum.
The total loan paid by the funds to the operators of different sectors from 2008 to the end of July 2020 amounted to 58 thousand 673 billion Rials, of which 9 thousand 123 billion Rials from 2008 to 2020 and 49 thousand 550 One billion Rials paid from 2013 to the end of July 2020, and more than 100,000 billion Rials have been paid since June 2020 to September 2022.
The distribution of credits to non-governmental funds is recognized as suitable platform for providing facilities and credits for government support and subsidies in the agricultural sector. For this reason, since 2008 and with the support of the Ministry of Agriculture Jahad, the responsibility of distributing government funds to help farmers and implement government development programs in the agricultural sector within the framework of contracts was delivered to agricultural jahad organizations in the provinces of the country as the provincial branches of the ministry.
Government Credit Agencies Report of all Funds until the end of July 2020 by provincial branches including:
water transfer projects with pipes, water storage pool, livestock breeding, fodder subsidies, cotton seed subsidies, aquaculture, local census and completion of beneficiaries’ identity cards , Improving the cultivation pattern, controlling pests and plant diseases, supporting agricultural technical and consulting networks, etc.

Based on Note 4 of Article 17 of the Law on Increasing the Productivity of the Agricultural Sector, the Funds for Supporting the Development of the Agricultural Sector are paying these facilities from 2008 to the end of July 2020 The local branches paid more than 52 thousand billion Rials for 877 thousand hectares. Out of it 257 thousand hectares with a credit amount of seven thousand and 645 billion Rials from 2008 to the March of 2013 and the implementation more than 620 thousand hectares with a credit of 44,785 billion Rials has been from 2013 to the end of July 2020.

Efficiency of Fund activities:
The effect of the activities of the funds can be generally expressed in the following cases:
1) Quick and easy payment of low interest loan to the members with the least complexity and time consuming which can be considered as soft loan.
2) Resolving some part of the problems of the members in providing collateral and financial guarantees through the providing financial deposit as a guarantee and the exchange of agreements with other banks.
3) Financing in order to provide some of the inputs needed by members at a reasonable price, cheaper than common price.
4) Creating harmony, empathy and cohesion between the organizations of agriculture sector.
5) Gaining confidence and trust of producers in the Funds of support the development of the agriculture about the organization of meeting the financial and credit needs of the agriculture by the non-governmental sector.
6) Capacity building of the non-governmental sector in order to accept responsibility for investment, financially and credit in the agricultural sector.
7) Strengthening the self-control and continuous monitoring by members to deal with possible deviation of the facility from the objectives and timely repayment of the facility.
8) Integration of government and non-governmental sector financial resources and the sustainability of these resources for the purposes of the agricultural sector.
9) Increasing the negotiation power of members before banks, financial and credit institutions.

The way forward:
The effective and desirable performance of the funds and the support of the officials have led the law of increasing the productivity to provide more space for the Funds. Among the capacities provided by this law is Funds are permitted to form at the sectoral, county, provincial, national, professional and product levels, financial, credit and commercial activities, issuance and sale of participation bonds, use of allocated resources of the National Development Fund. He mentioned agricultural insurance, the distribution of government funds, the use of foreign financial resources, and so on.