Agriculture Infrastructure fund

Subject: Economy

Context:

Cabinet has approved for setting up an agri-infra fund with a corpus of Rs 1 lakh crore

Concept:

• 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.
• This new agri-infra fund has duration of 10 years till 2029.
• Under the scheme, Rs. One Lakh Crore will be provided by banks and financial institutions as loans to Primary Agricultural Credit Societies, Marketing Cooperative Societies, Farmer Producers Organizations, Self Help Group, Farmers, Joint Liability Groups, Multipurpose Cooperative Societies, Agri-entrepreneurs, Startups, Aggregation Infrastructure Providers and Central/State agency or Local Body sponsored Public Private Partnership Project
• 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.
• Further, 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.
• Agri Infra fund will be managed and monitored through an online Management Information System (MIS) platform. It will enable all the qualified entities to apply for loan under the fund.
• The National, State and District level Monitoring Committees will be set up to ensure real-time monitoring and effective feed-back.

Benefits:

• The Project by way of facilitating formal credit to farm and farm processing-based activities is expected to create numerous job opportunities in rural areas.