Union Cabinet redesigns Agri Infra Fund to cover FPOs
- Expansion to make scheme more impactful and inclusive, says the Centre
Highlights:
- The Union Cabinet's recent decision to expand the scope of the Agricultural Infrastructure Fund (AIF) marks a significant step towards strengthening agricultural infrastructure and supporting Farmers’ Producers Organisations (FPOs) across India.
- Initially launched in 2020, the AIF is a ₹1 lakh crore initiative aimed at providing financial support for the development of farm-related infrastructure.
- The latest expansion seeks to make the scheme more inclusive and impactful, particularly by enhancing the financial security and creditworthiness of FPOs.
Key Highlights of the Expanded AIF
- Inclusion of FPOs: The most notable change in the scheme is the inclusion of FPOs as a key beneficiary. This move is designed to bolster the financial security of FPOs, making them more creditworthy and enabling them to access funds for infrastructure projects more easily.
- Increased Scope of Eligible Projects: The Cabinet's decision also involves broadening the range of projects eligible for support under the AIF. This expansion is expected to attract more private investment in agriculture, thereby fostering a robust agricultural infrastructure ecosystem.
- The types of projects that could benefit include cold storage facilities, processing units, and other critical infrastructure that enhances productivity and reduces post-harvest losses.
- Economic Impact and Employment Generation: According to the Centre, the AIF has already sanctioned ₹47,575 crore for 74,508 projects. These projects have mobilized an investment of ₹78,596 crore in the agriculture sector, with the majority of the investment coming from private entities.
- Furthermore, these infrastructure projects have created over 8.19 lakh rural employment opportunities, highlighting the scheme's role in driving economic growth in rural areas.
- Investment in Agriculture: The expansion of the AIF is poised to attract further investment into the agriculture sector.
- With the integration of additional supportive measures, the scheme is expected to enhance farm productivity, increase farmers' incomes, and contribute to the overall sustainability of Indian agriculture.
Prelims Takeaways:
- FPOs
- AIF