Agriculture Minister Narendra Singh Tomar on Saturday said his ministry will soon seek the Cabinet nod for a proposal to allow emerging technology-based farm projects like hydroponics access the Rs 1 lakh crore Agriculture Infrastructure Fund. Set up in 2020, the Agriculture Infrastructure Fund (AIF) provides financing facility for setting up of post harvest infra projects at farm-gate and aggregation points. Loans are provided at interest subvention of 3 per cent per annum up to a limit of Rs 2 crore. The subvention is for a maximum period of 7 years.
"We are considering allowing more projects under AIF, for which we are soon going to seek approval from the Cabinet," Tomar said after giving away awards to the best performing banks under AIF.
The changes to AIF have been proposed to allow emerging technology-based farm projects like hydroponics to borrow from AIF.
Last time, the government had made changes to AIF was in July 2021. Then, the government had allowed APMCs, state agencies, federations, cooperatives of farmers and self help groups to seek funds for infrastructure development projects.
Tomar said the infrastructure projects under AIF should be set up near farm-gate so that farmers get maximum benefit of it.
While the country has made strides in farm productivity, now the focus is on improving farmers' income. Therefore, the technology and necessary post harvest infrastructure need to be made available to the farming community so that their income rises, he said.
Tomar also said both states and banks need to address the gap in sanctioning fund through AIF for eligible beneficiaries.
As of now, out of more than 23,000 applications received on the integrated portal of AIF, 13,700 applicants have been sanctioned amounting to Rs 10,131 crore AIF loans with a combined investment of around Rs 17,500 crore by various lending institutions, as per the official data.
Speaking on the occasion, Minister of State for Agriculture Kailash Choudhary said banks' role is the key as AIF in future will give a big push to startups and farmer producer organisations.
So, banks needs not worry about sanctioning loans to applicants under AIF as the government gives credit guarantee, he said.
Agriculture Secretary Manoj Ahuja asked banks to simplify the loan process for projects applied under AIF, and state governments to set up project monitoring units to expedite the applications under this scheme.
There is a huge demand for AIF for various projects. To reach out to them, banks should work on a campaign mode and take up 'one branch, one application' approach to make the AIF scheme successful, he said.
"There are one lakh bank branches in the country. If one application is cleared by one branch, then we will easily achieve the target set under AIF. This will also improve infrastructure in the farm sector," he added.
State Bank of India, Punjab National Bank and Bank of India bagged AIF Award for their best performance. The agriculture ministry has decided to honour banks annually.
Source: The Economics Times