OREANDA-NEWS. November 02, 2009. The deputy general director of Kuwait Fund of Arab Economic Development Hesham al-Vakayan paid a visit to Uzbekistan, reported the Official website gov.uz.

A loan agreement was signed between the Kuwait Fund and the Republic of Uzbekistan. In accordance with the document, the fund will allocate a loan worth 4.34 million Kuwaiti dinars (equivalent of USD 15.62 million) for the financing of the project “Rehabilitation of irrigation and drainage networks in Jizzakh and Syrdarya regions”.

The project aims to increase the crop capacity at the irrigated agricultural lands in Jizzakh (210,000 hectares) and Syrdarya (222,000 hectares) regions through modernization of the existing and construction of the new irrigation and drainage networks. The growth of the crop capacity should positively affect the formation of the incomes of the farms and the population of the project regions.

The project works include reconstruction of the melioration system of Syrdarya region, which has a length of about 347 km, reconstruction of 268 km of drainage system and construction of 50 vertical drainage wells.

The work in Jizzakh region includes construction of a new energy efficient pump station and the 15-km machine canal, and reconstruction of the 68-km drainage canal. Works to soften the project’s influence on the environment and institutional support to agricultural producers will also be held.

The project is planned to be implemented during 2010-2014.

Apart from the Kuwait Fund, the Islamic Development Bank and the OPEC Fund with the volume of financing equal to USD 65.37 million are participating in the project. The total volume of attracted foreign investments comprises the equivalent of USD 81 million.

The Kuwait Fund loan is being provided for the period of 21 years, including 6-year grace period, with the annual interest rate of 2.5%.

Over the years of cooperation with Uzbekistan, the Kuwait Fund has provided five loans to Uzbekistan, including the above-mentioned one, worth a total of 26 million Kuwaiti dinars (equivalent of USD 90 million) for the financing of the projects in various sectors of the economy, as well as two grants worth 0.35 million Kuwaiti dinars (USD 1.12 million).