AGRICULTURE INFRASTRUCTURE FUND

AGRICULTURE INFRASTRUCTURE FUND

CONTEXT

• Recently, the Union Cabinet approved some modifications in the Central Sector Scheme of Financing Facility under ‘Agriculture Infrastructure Fund’.

AGRICULTURE INFRASTRUCTURE FUND (AIF)

• Government launched a new Scheme of financing facility under the Agriculture Infrastructure Fund (AIF) of Rs. 1 Lakh Crore.
• The Agriculture Infrastructure Fund is a medium – long term debt financing facility for investment in projects for post-harvest management infrastructure and community farming assets through interest subvention and credit guarantee.
• The scheme will support Agri-entrepreneurs, Farmer Producer Organization (FPO), and Primary Agricultural Credit Society (PACS).
• Objective – The key objective of the Agriculture Infrastructure Fund (AIF) is to provide financial support for agriculture entrepreneurs in order to improve agriculture infrastructure in the country.
• Beneficiaries Agriculture Infrastructure Fund (AIF)
  • Farmers
  • SHG – a self-help group
  • Agri-entrepreneurs
  • Startups
  • Primary Agricultural Credit Society (PACS)
  • Marketing Cooperative Societies
  • Farmer Producer Organization (FPO
  • Joint Liability Groups (JLG)
  • Multipurpose Cooperative Societies
  • Central/State agency or local Body sponsored Public-Private Partnership Projects
• Interest Subvention – Loans will have interest subvention of 3% per annum up to a limit of Rs. 2 crores. This subvention will be available for a maximum period of seven years.
• CGTMSE Scheme – A 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 crores.

INTENDED BENEFITS

• AIF will improve the overall income of farmers
• The Improved marketing infrastructure will farmers to sell directly to a larger base of consumers and hence, increase value realization for the farmers
• AIF will make farmers independent and improve access to market
• Farmers can able to decide when to sell in the market and improve realization using
• the modern packaging and cold storage system access
• With a dedicated source of funding, entrepreneurs will push for innovation in the agriculture sector by leveraging new-age technologies including IoT (internet of things), AI (artificial intelligence), etc.
• AIF will improve avenues for collaboration between entrepreneurs and farmers.