Agriculture Infrastructure Fund (AIF)

News: Recently, Punjab has fully utilized the Rs 4,713 crore provided by the Centre through the Agriculture Infrastructure Fund (AIF) scheme.

About Agriculture Infrastructure Fund (AIF)

• It is a financing scheme launched by the Government of India in July 2020 to provide medium to long-term funding for the development of post-harvest agriculture infrastructure.
• Aim: It is designed to provide medium to long-term debt financing for viable projects that enhance post-harvest management and establish community farming assets.
• Goal: Its primary goal is to offer comprehensive financial assistance to farmers, agri-entrepreneurs, and farmer groups, including Farmer Producer Organisations (FPOs), Self Help Groups (SHGs), and Joint Liability Groups (JLGs).
• Features of AIF:
  • All loans up to ₹2 crore under this financing facility will receive an interest subvention of 3% per annum for a maximum duration of seven years.
  • An applicant can undertake up to 25 projects across different locations, with each project eligible for a loan of up to ₹2 crore under the scheme. This limit of 25 projects applies to private sector entities, including farmers, agri-entrepreneurs, and start-ups.
  • However, this restriction does not apply to state agencies, cooperatives, national and state cooperative federations, FPOs, federations of FPOs, SHGs, and federations of SHGs.
  • Multiple projects within the same location are also permitted, subject to an overall cap of ₹2 crore.
  • Additionally, borrowers must contribute at least 10% of the total project cost, regardless of any available capital subsidy.