- The Government of India launched the Central Sector Scheme of financing facility under the Agriculture Infrastructure Fund (AIF) in 2020.
- AIF is a medium – long term debt financing facility for investment in viable projects for post-harvest management infrastructure and community farming assets through interest subvention and credit guarantee.
- AIF aims at bringing farmers & agribusinesses together with newer partnership models emerging for the creation of distributed infra near farm-gate in a hub & spoke model. These assets will enable farmers to get greater value for their produce as they will be able to store and sell at higher prices, reduce wastage, and increase processing and value addition.
- The duration of the scheme is from 2020-21 to 2032-33.
- Under the scheme, all loans up to a limit of ₹ 2 crores under this financing facility will have interest subvention of 3% per annum. This subvention will be available for a maximum period of 7 years. In case of loans beyond ₹ 2 crores, the interest subvention will be limited up to ₹ 2 crores.
- Credit guarantee coverage will be available for eligible borrowers from this financing facility under Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE) scheme for loans up to ₹ 2 crores.
- Launched in 2000, CGTMSE makes available collateral-free credit to the micro and small enterprise sector. The corpus of CGTMSE is being contributed by the Government of India and SIDBI in the ratio of 4:1 respectively.
- Eligible beneficiaries: The scheme supports private investment and investment by farmers’ collectives like Primary Agricultural Credit Society (PACS), National/ State level federations of Cooperatives, Farmer Producer Organizations (FPOs), federations of FPOs & SHGs and investment by Agricultural Produce Market Committees (APMCs) & State Agencies etc. in agriculture infrastructure.
Why in News?
- Within two-and-a-half years of the implementation of the Agriculture Infrastructure Fund (AIF), the scheme has mobilized more than Rs. 30,000 crore for projects in the agriculture infrastructure sector.