“Agriculture Infrastructure Fund” crosses Rs. 8,000 crore mark

What is the News?

After receiving around 8,665 applications worth Rs. 8,216 core Agriculture Infrastructure Fund(AIF) has crossed the Rs.8000 crore mark.

Sectors: The largest share of the fund has gone to Primary Agricultural Credit Societies (PACS) (58%). This is followed by agri-entrepreneurs (24%) and individual farmers (13%).

States: Andhra Pradesh has received the highest amount of funds. This is followed by Madhya Pradesh, Uttar Pradesh, Karnataka and  Rajasthan.

About Agriculture Infrastructure Fund(AIF):

• Nodal Ministry: It is a Central Sector Scheme launched by the Department of Agriculture Cooperation and Farmers Welfare(DAC&FW).
• Aim: To provide medium – long term debt financing facility for investment in viable projects. This includes post-harvest management Infrastructure and community farming assets through incentives and financial support.
• Funding: Under the scheme, banks and financial institutions will provide Rs. 1 Lakh Crore as loans to eligible beneficiaries.
• Eligible Beneficiaries: Farmers, FPOs, PACS, Marketing Cooperative Societies, SHGs, Joint Liability Groups(JLG). The beneficiaries also include Agri-entrepreneurs, startups and Central/State agency or Local Body sponsored Public-Private Partnership Projects.
• Lending Institutions: Multiple lending institutions including Commercial Banks, Cooperative Banks, NCDC, NBFCs etc.
• Duration of the Scheme: FY2020 to FY2029 (10 years)

Other Key Features of Agriculture Infrastructure Fund:

• Firstly, Interest Subvention: Loans will have an 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.
• Secondly, Credit Guarantee: A credit guarantee coverage will be available for eligible borrowers from the scheme. This coverage is provided under Credit Guarantee Fund Trust for Micro and Small Enterprises(CGTMSE) scheme for a loan up to Rs. 2 crores. The government will pay fee for this credit coverage.
• Thirdly, Project Management Unit to provide handholding support for projects including project preparation.
• Fourthly, The moratorium for repayment of a loan under this financing facility may vary subject to a minimum of 6 months and a maximum of 2 years.
• Fifthly, Need-based refinance support will be made available by NABARD to all eligible lending entities.

Source: PIB