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International Fund for Agricultural Development (IFAD): History, Mandate, Functions, Membership

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International Fund for Agricultural Development

  • IFAD is an international financial institution and a specialized agency of the United Nations exclusively dedicated to transforming agriculture, rural economies and food systems. 
  • IFAD invests in the millions of people who are most at risk of being left behind: poor, small-scale food producers living in rural areas. 
  • IFAD is the world’s fund for transforming agriculture, rural economies and food systems.
  • Its objective is to improve agricultural development and livelihoods in developing countries.
  • IFAD is one of the leading inclusive rural finance funders worldwide, with nearly one billion dollars in ongoing investments. 
  • It is a member of the United Nations Development Group
  • Headquarters: Rome, Italy

History

It was established in 1977 as a response to the 1974 World Food Conference, which identified food insecurity as a global challenge.

Background

In the early 1970s, global food shortages caused widespread famine, malnutrition and death, especially in the Sahel region of Africa. The world needed long-term, systemic solutions for the structural problems causing poverty and food shortages. 

In 1974, the UN World Food Conference looked to address these issues. It was decided to create an agency to finance agricultural development in poor rural communities

IFAD – Mandate

  • Specialised UN agency & International Financial Institution (IFI):
    • Established to mobilise resources for agriculture and rural development in developing countries.
  • Unique mandate:
    • The only IFI with the specific mandate to eradicate poverty and hunger by investing in poor rural people.
  • Approach:
    • Provides financial and technical assistance to support agricultural productivity and rural development projects.
  • Financing of operations:
    • Member State contributions
    • Loan repayments
    • Investment income
    • Special contributions from non-Member States
    • Sovereign borrowing
    • Concessional loans
    • Borrowing in international capital markets

Work

  • It reduces poverty, improves nutrition and increases food production by providing loans and grants that transform rural communities.
    • It supports rural people to establish informal savings and credit groups. Through these, they save collectively and take out small loans to invest in their households and economic activities.
    • It works with the private sector to provide rural financial services. 

  • The IFAD assists vulnerable groups such as smallholder farmers, pastoralists, foresters, fishers and small-scale entrepreneurs in rural areas by providing, among others, access to weather information, disaster preparedness, social learning and technology transfer that enables farmers to feed growing populations and increase the climate resilience of rural farming systems.

Membership

  • It has 180 Member States
  • Any country that is a member of the United Nations, its specialized agencies or the International Atomic Energy Agency can become an IFAD Member State. 
  • India is a founding member of IFAD and the partnership spans more than 40 years. India is not only the largest recipient of IFAD’s investments, but also a significant contributor in terms of both financial support and corporate policy engagement as a member of IFAD’s Executive Board.

Governance

Governing Council 

  • The Governing Council is IFAD’s main decision-making body and consists of all Member States. The Council meets annually to decide on issues such as new members, appointing IFAD’s President, approving budgets, and adopting policies, criteria and regulations. 

Executive Board

  • The Executive Board oversees the general operations of IFAD and approves its programme of work. Members serve a three-year term and are determined by the Governing Council.

FAQs

Q1. What is IFAD?

The International Fund for Agricultural Development (IFAD) is a UN specialized agency and international financial institution dedicated to eradicating rural poverty, hunger, and malnutrition by financing agricultural development in developing countries.

Q2. When and why was IFAD established?

IFAD was established in 1977, following the 1974 World Food Conference, to provide long-term solutions to global food insecurity and rural poverty caused by famines and structural agricultural challenges.

Q3. Where is IFAD headquartered?

IFAD’s headquarters is located in Rome, Italy.

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