Agri-infra fund: PM Modi to launch financing facility of ₹1 lakh

[NiveRoshni]

The agri-infra fund was part of the over ₹20 lakh crore stimulus package announced in response to the COVID-19 crisis.

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Narendra Modi

Prime Minister Narendra Modi will launch financing facility of ₹1 lakh crore under Agriculture Infrastructure Fund tomorrow through video conferencing. Govt in July had approved the setting up of an agri-infra fund with a corpus of ₹1 lakh crore to extend subsidised credit for farm infrastructure projects. PM will also release 6th installment of ₹17,000 crores fund to 8.5 crores farmers under PM-KISAN scheme.

What is Agriculture Infrastructure Fund

The agri-infra fund was part of the over ₹20 lakh crore stimulus package announced in response to the COVID-19 crisis.

The Agriculture Infrastructure Fund, the duration of which will be 10 years till 2029, aims to provide medium-to-long term debt financing facility for investment in viable projects for post-harvest management infrastructure and community farming assets through interest subvention and financial support.

₹10,000 crore for current year

Under this, about ₹1 lakh crore will be provided by banks and financial institutions as loans to primary agri credit societies, farmer groups, farmer producer organisations (FPOs), agri-entrepreneurs, start-ups and agri-tech players.

Loans will be disbursed in four years starting with sanction of ₹10,000 crore in the current year and ₹30,000 crore each in the next three financial years.

All loans under this financing facility will have interest subvention of 3 per cent per annum up to a limit of ₹2 crore. This subvention will be available for a maximum period of seven years.

Management Information System

The ministry said the agri-infra fund, which will be managed and monitored through an online Management Information System (MIS) platform, will enable all the qualified entities to apply for loan under the fund.

The online platform will also provide benefits such as transparency of interest rates offered by multiple banks, scheme details including interest subvention and credit guarantee offered, minimum documentation, faster approval process as also integration with other scheme benefits.

The ministry said that facilitating formal credit to farm and farm processing-based activities is expected to create numerous job opportunities in rural areas.