News ID: 255069
Published: 0242 GMT June 30, 2019

Rental farming system development needed for Iran’s agriculture sector

Rental farming system development needed for Iran’s agriculture sector

By Hossein Shirzad*

Part 2

The governing relations of the rental farming system have been institutionalized during ages; however, these regulations had been acting based on their established usage rather than legally written documents.

Because of the mutual trust between tenants and landlords, most tenancy agreements were not formally registered, yet they worked as customarily and informal deeds and sometimes were signed by the trusted local people.

The tenant paid the whole rent at the time of signing the tenancy agreement. The landlord delivered the due certificates for receiving agricultural inputs to the tenant along with a copy of the tenancy agreement.

Receiving any bank loan by the tenant required signing a formal contract by the parties at the notary offices.

The current enforced law is the one approved in 1997. Being informal and verbal, the governing relations of the rental farming demands to be systematized according to the national legal structure; however, this regulating process should be preceded by the due essential arrangements in order to block further arising problems.

Nowadays, it is unanimously accepted that rental farming needs to be integrated and lawful. This executive system of rental farming is going to monitor and manage the whole process.

The involving organizations and persons, including the Agricultural Jihad Ministry, Iran Agricultural Engineering Organization, the landlord and the tenant are assigned with specific duties in establishing an executive system for rental farming.

To this end, creating a specific guild system, like the union of the real estate agencies, is deemed necessary in order to supervise the legality of the farm rent in  the meantime, the role of rural production cooperatives is crucial, in as much as they manage the rural farming system, along with, they can organize the rental ones, too.

Providing a legal and business-oriented mechanism which includes the interest of both parties such as rent timing, rural production cooperative could manage the rental farming system.

Having learned by experience, the one-year renting period causes a loss for both parties, by virtue of the maximum exploitation of land which would lead to soil erosion. As an instance, some Isafahani and Yazdi tenants, in order to achieve maximum profit during one year, were using the whole water, which was not a sustainable method.

Taking the role of a mutual-consent arbitrator as well as a supervisory agent, the rural production cooperative could definitely settle arising disputes through the development of a fair tenancy agreement.

The second role of a rural production cooperative is to educate the tenants to be skilled as native farmers; in other words, it could reorganize water and land resource exploitation as participatory approach organization and, moreover, it could provide services including extension, securing inputs and create a revenue resource for members.

And last but not least, the agriculture sector needs direct and indirect education, de facto. The increasing rate of agriculture educated, lack of entrepreneurship opportunities, the landless farmers and, the weak financial potential of small-scale farmers are leading the agriculture sector toward a transitive farming system, in which many countries have domesticated  and applied them as different forms of rental farming system, as a promising transition in the agriculture system.

*Hossein Shirzad is deputy minister of Agricultural Jihad and CEO of the Central Organization for Rural Cooperatives (CORC).  


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