India may soon decide to issue “green bonds” to support a portion of NMNF
The Cabinet will soon decide what to do about the Agriculture Ministry’s proposal to spend ₹2,481 crore on the National Mission on Natural Farming (NMNF), which would run from the current fiscal year until 2025–26. The goal of the NMNF is to get 7.5 lakh farmers to use natural farming without chemicals on 7.5 lakh hectares. Under the plan, farmers will get up to ₹15,000 per hectare in funding (until 2025-26) if they lose money after switching to natural farming, which could happen.
At first, it will be focused on the 5-kilometer-wide strip along the Ganga River, and then it will be expanded to other places.
According to the plan for the centrally sponsored scheme, the Center will pay ₹1,584 crores over the next three years, while the States will pay ₹897 crores. The proposed spending also includes ₹207 crores from the central government and ₹95 crores from the state government, which will be spent over the rest of the current fiscal year.
How is money raised?
A source said that the Center is likely to pay for the plan in part with the money it gets from the Agriculture Development Cess and in part with ‘Green Bonds.’ He also said that the Finance Ministry will decide how the green bonds will work. The funding will be split 60:40 between the Center and the States, except for the Northeast and hilly states, where it will be 90:10.
Sources say that the goal of helping 7.5 lakh farmers is based on the amount of money that the Finance Ministry has approved for the scheme. Increasing the size of the program will depend on how well it works and how well farmers like it.
In a change from past plans, the ministry wants to give money to recipients based on how well they do, not on a monthly or annual incentive, a source said. Farmers who are part of the NMNF are not allowed to use chemical fertilizers or pesticides. To make sure of this, the Agriculture Ministry is thought to have already set up the right monitoring systems, such as regular soil tests.
In the proposal, the Centre for Management of Agricultural Extension (MANAGE), the National Centre of Organic and Natural Farming (NCOF), and the Krishi Vigyan Kendras (KVKs) are named as the central agencies that will carry out the scheme with direct funding of ₹165 crores from the center’s share.
‘It will take at least four years to reach the goal of enrolling 7.5 lakh farmers because the whole process of building farmers’ skills through forming clusters, certifying them, and organizing them as FPOs is very slow,’ said a source. ‘The goal of the proposed NMNF is to combine traditional knowledge with modern science to help farmers, soil, food quality, and the environment,’ said the source.
The Indian Council of Agricultural Research (ICAR) has said that the scheme should be changed because it only sets aside less than 1% of the total amount planned to be spent on market development, publicity, and tracking the health of the soil. An official said that the products from the NMNF clusters need to have a sure market and that a fair amount of money should also be given.