This is to improve irrigation farming and flood prevention, its Junior Minister of Finance said on Thursday.
Bashir Yuguda said in a statement that 495 million dollars of the amount will be used for the irrigation project in three northern states of Zamfara, Sokoto and Kano, while 200 million dollars will be used for drainage system in southwestern state of Ibadan.
The remaining 250 million dollars will go on a third water sector reform project in the three states of Bauchi, Ekiti and Rivers.
“Part of the fund … is to upscale the cultivation of the irrigatable land in the country. We have an estimated 2.2 million hectares of potentially irrigable land … of which about one million hectares is situated in the northern part,” he told reporters.
Yuguda said the loan, which would be repaid in 20 years’ time, with a moratorium period of five years, had an interest rate of 1.25 per cent and a service charge of 0.75 per cent.
Nigeria is seeking to develop agriculture to help it shift away from oil and better manage shocks from falling oil prices and production. Agriculture Minister Akinwumi Adesina told Reuters last month the government wanted to replace oil as a source of income in the next five to eight years.