Agri ministry to seek Cabinet approval for ₹1 lakh crore Agri Infra Fund – Tomar
Agriculture Minister Narendra Singh Tomar said on Saturday that his ministry will soon seek Cabinet approval for a proposal to give access to the ₹ 1 lakh crore Agriculture Infrastructure Fund to new technology-based farm initiatives such as hydroponics.
The Agriculture Infrastructure Fund (AIF), established in 2020, provides a financial instrument for the establishment of post-harvest infrastructure projects at farm-gate and aggregation locations. Loans are available at a 3% annual interest subsidy up to a ceiling of ₹ 2 crores. The subvention is valid for a maximum of seven years.
‘We are considering permitting more projects under AIF, for which we will soon seek Cabinet approval,’ Tomar said after awarding the top-performing banks under AIF.
AIF amendments have been proposed in order to allow developing technology-based agriculture initiatives such as hydroponics to borrow from AIF.
The last time the government changed AIF was in July 2021. The government had previously authorized APMCs, state agencies, federations, farmer cooperatives, and self-help groups to apply for funding for infrastructure development projects.
Tomar believes that AIF infrastructure improvements should be located near farm gates so that farmers can reap the most benefits.
While the country has made achievements in farm productivity, the emphasis is now on increasing farmer income. As a result, he believes that the farming community should have access to the appropriate post-harvest infrastructure in order to increase their income.
Tomar also stated that both states and banks must bridge the funding gap for eligible recipients through AIF.
According to official data, out of more than 23,000 applications received on the AIF integrated site, 13,700 applicants have been sanctioned for ₹ 10,131 crore AIF loans with a combined investment of roughly ₹ 17,500 crores by various lending institutions.
Speaking at the event, Minister of State for Agriculture Kailash Choudhary stated that banks’ engagement is critical since the AIF will provide a significant boost to startups and farmer producer organizations in the future.
As a result, banks need not be concerned about awarding loans to AIF applicants because the government provides credit guarantees, he said.
Agriculture Secretary Manoj Ahuja has encouraged banks to simplify the credit process for AIF projects, and state governments to establish project monitoring units to expedite AIF applications.
AIF is in high demand for a variety of projects. To reach them, banks should use a campaign mode and a ‘one branch, one application’ strategy, he said, in order for the AIF plan to be successful.
‘The country has one lakh bank branches. If only one application is cleared by one branch, we will easily meet the AIF objective. This will also help to strengthen farm infrastructure,’ He continued.