{"id":128,"date":"2021-05-12T09:11:42","date_gmt":"2021-05-12T09:11:42","guid":{"rendered":"https:\/\/www.enrichservices.in\/l\/?p=128"},"modified":"2022-04-19T03:11:54","modified_gmt":"2022-04-19T03:11:54","slug":"scheme-for-financing-under-agriculture-infrastructure-fund","status":"publish","type":"post","link":"https:\/\/www.enrichservices.in\/l\/blog\/scheme-for-financing-under-agriculture-infrastructure-fund\/","title":{"rendered":"Scheme for Financing under Agriculture Infrastructure Fund"},"content":{"rendered":"

\"enrich<\/span><\/p>\n

Agriculture Infrastructure Fund (AIF)<\/span><\/h2>\n

Indian Government has recently launched a new Scheme of financing facility under the Agriculture Infrastructure Fund (AIF) of Rs. 1 Lakh Crore. The Agriculture Infrastructure Fund is a medium \u2013 long term debt financing facility for investment in projects for post-harvest management infrastructure and community farming assets through interest subvention and credit guarantee. The scheme will support Agri-entrepreneurs, Farmer Producer Organization (FPO), and Primary Agricultural Credit Society (PACS). Under the scheme, bank and the financial institution will provide Rs. 1 Lakh Crore as loans with interest subvention of 3% per annum and credit guarantee coverage under CGTMSE scheme for loans up to Rs. 2 Crore. The present article briefs the Agriculture Infrastructure Fund<\/a><\/strong><\/span> (AIF) scheme.<\/span><\/p>\n

Objectives of AIF<\/span><\/h3>\n

The key objective of the Agriculture Infrastructure Fund (AIF) is to provide financial support for agriculture entrepreneurs to improve agriculture infrastructure in the country.<\/span><\/p>\n

Benefits of the AIF<\/strong><\/span>
\nThe beneficiaries of the AIF scheme will include:<\/strong><\/span><\/p>\n

\u2022 Farmers<\/span>
\n\u2022 SHG \u2013 a self-help group<\/span>
\n\u2022 Agri-entrepreneurs<\/span>
\n\u2022 Startups<\/span>
\n\u2022 Primary Agricultural Credit Society (PACS)<\/span>
\n\u2022 Marketing Cooperative Societies<\/span>
\n\u2022 Farmer Producer Organization (FPO<\/span>
\n\u2022 Joint Liability Groups (JLG)<\/span>
\n\u2022 Multipurpose Cooperative Societies<\/span>
\n\u2022 Central\/State agency or local Body sponsored Public-Private Partnership Projects<\/span><\/p>\n

Benefits of Agriculture Infrastructure Fund<\/strong><\/span><\/p>\n

This financing facility will have numerous benefits for all the stakeholders in the agriculture eco-system:<\/span><\/p>\n

Benefits to Farmers FPOs, PACS & Marketing Cooperative Societies<\/strong><\/span><\/p>\n

\u2022 AIF will improve the overall income of farmers<\/span>
\n\u2022 The Improved marketing infrastructure will farmers to sell directly to a larger base of consumers and hence, increase value realization for the farmers<\/span>
\n\u2022 AIF will make farmers independent and improve access to market<\/span>
\n\u2022 Farmers can be able to decide when to sell in the market and improve realization using<\/span>
\n\u2022 the modern packaging and cold storage system access<\/span>
\n\u2022 Benefits to Agri entrepreneurs and start-ups<\/span>
\n\u2022 With a dedicated source of funding, entrepreneurs will push for innovation in the agriculture sector by leveraging new-age technologies including IoT (internet of things), AI (artificial intelligence), etc.<\/span>
\n\u2022 AIF will improve avenues for collaboration between entrepreneurs and farmers.<\/span><\/p>\n

Duration of the scheme<\/strong><\/span><\/p>\n

The duration of the Agriculture Infrastructure Fund scheme shall be from the current financial year to the Financial year 2029 (10 years).<\/span><\/p>\n

Financial Assistance under Agriculture Infrastructure Fund (AIF)<\/strong><\/span><\/p>\n

Under the scheme, banks and financial institutions will provide Rs. 1 Lakh Crore as loans with interest subvention of 3% per annum and credit guarantee coverage under CGTMSE scheme for loans up to Rs. 2 Crore.<\/span><\/p>\n

Interest Subvention Cost<\/strong><\/span><\/p>\n

All loans under AIF will have an interest subvention of 3% per annum up to a limit of Rs. 2 crores.<\/span>
\nThis subvention will be available for a maximum period of 7 years. In the case of loans beyond Rs.2 crore, then interest subvention will be limited up to 2 crores.<\/span>
\nThe loans will be disbursed in four years starting with the sanction of Rs. 10,000 crores in the current financial year and Rs. 30,000 crore each in the next three fiscal years.<\/span>
\nThe extent and percentage of funding to private entrepreneurs out of the total financing facility may be fixed by the National Monitoring Committee<\/span>
\nCredit Guarantee Cost<\/span>
\nCredit guarantee coverage will be available for eligible borrowers from the Agriculture Infrastructure Fund (AIF) under Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE) scheme for a loan up to Rs. 2 crores. The Government will pay the fee for AIF coverage.<\/span>
\nMoratorium for Repayment<\/span>
\nThe moratorium for repayment under this AIF may vary subject to a minimum of 6 months and a maximum of 2 years.<\/span><\/p>\n

Eligible Projects<\/strong><\/span><\/p>\n

The scheme will facilitate setting up and modernization of key elements of the following projects:<\/span><\/p>\n