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Agriculture Infrastructure Fund

Topics Covered: Issues related to direct and indirect farm subsidies and minimum support prices; Public Distribution System objectives, functioning, limitations, revamping; issues of buffer stocks and food security; Technology missions; economics of animal-rearing.

Agriculture Infrastructure Fund


Context:

Prime Minister Narendra Modi recently launched the financing facility of Rs 1 lakh crore under the Agriculture Infrastructure Fund via video conferencing.

  • The fund has been launched as part of ‘Atmanirbhar Bharat’ (self-reliant India) to make farmers self-reliant.

About the Agriculture Infrastructure Fund:

It is a new pan India Central Sector Scheme.

  • The scheme shall provide a medium – long term debt financing facility for investment in viable projects for post-harvest management Infrastructure and community farming assets through interest subvention and financial support.
  • The duration of the Scheme shall be from FY2020 to FY2029 (10 years).

Eligibility:

Under the scheme, Rs. One Lakh Crore will be provided by banks and financial institutions as loans to Primary Agricultural Credit Societies (PACS), Marketing Cooperative Societies, farmer producer organisations (FPOs), SHGs, Farmers, Joint Liability Groups (JLG), Multipurpose Cooperative Societies, Startups etc.

Interest subvention:

All loans under this financing facility will have interest subvention of 3% per annum up to a limit of Rs. 2 crore. This subvention will be available for a maximum period of seven years.

Credit guarantee:

  • Credit guarantee coverage will be available for eligible borrowers from this financing facility under Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE) scheme for a loan up to Rs. 2 crore.
    • The fee for this coverage will be paid by the Government.
  • In case of FPOs the credit guarantee may be availed from the facility created under FPO promotion scheme of Department of Agriculture, Cooperation & Farmers Welfare (DACFW).

Management of the fund:

  • It will be managed and monitored through an online Management Information System (MIS) platform.
  • The National, State and District level Monitoring Committees will be set up to ensure real-time monitoring and effective feed-back.

InstaLinks:

Prelims Link:

  1. What are FPOs?
  2. What are Cooperatives? Constitutional provisions.
  3. About CGTMSE.
  4. Central sector vs Centrally sponsored schemes.
  5. Core vs core of core schemes.

Sources: pib.