The UN’s International Fund for Agricultural Development (IFAD) signed a financial agreement with the government of Bhutan recently that will reduce rural poverty and sustainably increase the incomes of over 28,000 smallholder farming households.

IFAD will provide a total of US$14.4 million through a loan and two grants to implement the agricultural development programme which will focus on marketing and climate resilient farming practices in 10 provinces located in southern and eastern regions of the country. The financing agreement was signed by Kanayo F. Nwanze, President of IFAD, and Lyonpo Namgay Dorji, Minister of Finance, Kingdom of Bhutan.

The Commercial Agriculture and Resilient Livelihoods Enhancement Programme is designed to ensure increased returns for smallholder farmers through climate resilient production of crops and livestock products. The programme will help transform the country’s subsistence-based agricultural economy into a more vibrant rural economy with well-established dairy and vegetable value chains that respond to market demand.

Poverty in Bhutan is overwhelmingly a rural phenomenon as nearly 95 per cent of poor people live in rural areas. The programme will benefit 28,975 smallholder households, of which 7,115 households will directly benefit from vegetable and dairy value chains.

IFAD has been working in Bhutan since 1981, investing over $65 million in eight programmes, with a total cost of $111.2 million including co-financing, reaching more than 121,035 households.

Press release No.: IFAD/86/2015

The International Fund for Agricultural Development (IFAD) invests in rural people, empowering them to reduce poverty, increase food security, improve nutrition and strengthen resilience. Since 1978, we have provided nearly US$17 billion in grants and low-interest loans to projects that have reached about 453 million people. IFAD is an international financial institution and a specialized United Nations agency based in Rome – the UN's food and agriculture hub.