India’s Cabinet modifies Rs 1-lakh-crore Agriculture Infrastructure Fund to help upgrade mandis

The Indian Cabinet approved modifications in the guidelines of the Rs 1-lakh-crore Agriculture Infrastructure Fund (AIF), a move which will expand the beneficiary institutions, including Agricultural Produce Market Committees (APMCs), to avail credit of up to Rs 2 crore from the Fund to set up cold storage, sorting, grading and assaying units. Till now, the government has sanctioned projects worth Rs 4,300 crore from the AIF.

There has been apprehension among a section of farmers that mandis will be closed down, whereas the government has been doing everything to strengthen the APMCs, said agriculture minister Narendra Singh Tomar after the Cabinet meeting.  The repayment period has been increased from 4 years to 6 years up to 2025-26 and overall period of the scheme has been extended from 10 years to 13 years up to 2032-33.

Taking the opportunity, Tomar also reiterated his appeal to farmer unions to end their protest and resume talks with the government on provisions of three farm laws, which are in suspension after the Supreme Court suspended it in January. Tomar again ruled out repeal of these Acts. He also asserted that the procurement system on the minimum support price (MSP) will stay.

“The APMCs are allowed to set up infrastructure facilities even outside the market yard premises, but will be within their command area,” Tomar said. This will help APMCs as most of the current market yards do not have additional space within the premises to set up such infra, said an official of the agriculture ministry.

During FY22 Budget, finance minister had announced that APMCs would be allowed to avail credit from AIF. “Eligibility (to avail loans from AIF) has now been extended to state agencies/APMCs, national and state federations of cooperatives, federations of farmers producers organisations (FPOs) and federations of self-help groups (SHGs),” the government said in a statement.

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