By: Dr. Satywan Saurabh
Prime Minister Narendra Modi recently launched a funding facility of Rs 1 lakh crore under the Agricultural Infrastructure Fund. This fund has been launched as a part of ‘Self-Reliant India’ to make farmers self-reliant. This fund will help create ‘post-harvest crop management infrastructure’ and ‘community agricultural assets’ such as cold storages, collection centers, processing units, etc.
This is a new Pan India Central Sector Scheme. Following this scheme, a medium-term debt financing facility will be made available for investment in viable projects for crop management. The duration of the scheme will be (10 years).
The Agricultural Infrastructure Fund will help in the creation of infrastructure connected to the agriculture sector in the rural sector during the ten years. Through this financing, private investment and jobs in rural areas are encouraged. For this purpose, about Rs 1 lakh crore will be provided by banks and financial institutions in the form of loans to Primary Agricultural Credit Societies, Farmers Groups, Farmer Producer Organizations (FPOs), agri-entrepreneurs, start-ups, and agri-tech players.
Under the scheme, Rs. 1 lakh crore loans by banks and financial institutions to Primary Agricultural Credit Societies (PACS), Marketing Cooperative Societies, Farmer Producer Organizations (FPOs), SHGs, Farmers, Joint Liability Groups (JLGs, Multipurpose Cooperative Societies, Startups) will be provided.
This scheme of Modi will also provide medium-long term loan financing facilities to farmers for post-harvest infrastructure management and investment in community agriculture projects through interest grants and financial support. Which will help the farmers of the country to get more value for their produce? With this financing, farmers will be able to store their produce and sell at higher prices, reduce wastage, and increase processing and value addition and get more profits.
Under this financing facility, there will be an interest subvention of 3% p.a on all loans. This subdivision will be available for a maximum period of seven years. Credit guarantee coverage will be available under the Credit Guarantee Fund Trust Scheme for Micro and Small Enterprises for eligible guarantees for this guarantee facility.
The fee for this coverage will be paid by the government. In the case of FPO, the benefit of credit guarantee can be availed from the facility created under the FPO incentive scheme of the Department of Agriculture, Cooperation, and Farmers Welfare (DACFW).
It will be managed and monitored through an online management information system (MIS) platform. National, state, and district level monitoring committees will be set up to ensure real-time monitoring and effective feedback.
The agricultural infrastructure fund implemented will be managed and monitored through the Online Management Information System (MIS) platform. This will enable all eligible entities to apply for loans. The new financing is expected to create many employment opportunities in rural areas by facilitating formal loans for agriculture and agro-processing based activities, so that rural India can become self-reliant in the coming times.
If seen, the present government is especially bringing farmer-friendly schemes, direct cash benefit of more than Rs. 75,000 crore to more than 9.9 crore farmers under Pradhan Mantri Kisan Samman Nidhi Yojana (PM-Kisan) launched in December 2018. This scheme has enabled the farmers to meet their agricultural needs and support their families.
The financing scheme will also help in providing necessary support to the farmers during the coronavirus epidemic. During the current lockdown period, about 22,000 crore rupees were released to the farmers across the country through various schemes to assist the farmers. The farmers will get the full benefit of these schemes to improve their economic condition.