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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.