Agriculture Infrastructure Fund (AIF) – (NABARD Supported Initiative)

The Agriculture Infrastructure Fund (AIF) is a landmark central sector scheme launched by the Government of India with a corpus of ₹1 Lakh Crore. Its primary objective is to mobilize medium to long-term debt financing for investment in viable projects related to post-harvest management infrastructure and community farming assets. NABARD plays a pivotal role in this scheme by providing refinance support to eligible lending entities, ensuring a robust credit flow to the agriculture sector.

The AIF aims to bridge critical infrastructure gaps in the agriculture sector, particularly at the farm-gate and aggregation points. By doing so, it seeks to:

• Reduce Post-Harvest Losses: Improve storage, processing, and logistics to minimize wastage of agricultural produce. 

• Enhance Value Realization for Farmers: Enable farmers to sell their produce directly to a larger consumer base, access better markets, and receive fair prices. 

• Promote Private Investment: Incentivize private sector participation and innovation in agricultural infrastructure development. 

• Boost Rural Economy & Employment: Create employment opportunities and drive economic growth in rural areas through new infrastructure projects.

• Support Modern Farming Practices: Facilitate the adoption of new technologies and efficient post-harvest management techniques.

   Key Features & Benefits:

1. Financial Outlay: A financing facility of ₹1 lakh crore for loans to be disbursed by lending institutions up to FY 2025-26.

2. Interest Subvention:

   • 3% interest subvention per annum on loans up to ₹2 crore.

      

   • This subvention is available for a maximum period of 7 years, including any moratorium period.

      

   • For loans exceeding ₹2 crore, the interest subvention benefit is capped at ₹2 crore of the loan amount.

3. Credit Guarantee Coverage:

   • Eligible borrowers can avail credit guarantee coverage under the Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE) scheme for loans up to ₹2 crore.

   • For Farmer Producer Organizations (FPOs), credit guarantee may be availed from the facility created under the FPO promotion scheme or NABSanrakshan.

   • The fee for this coverage is borne by the Government, reducing the risk for lenders and improving access to credit for beneficiaries.

4. Moratorium Period: A repayment moratorium of a minimum of 6 months and a maximum of 2 years can be availed, depending on the project type and its revenue generation capacity.

    

5. Eligible Beneficiaries: A wide range of entities are eligible to avail benefits under AIF, including:

   • Individual Farmers

   • Farmer Producer Organizations (FPOs) 

   • Primary Agricultural Credit Societies (PACS) 

   • Marketing Cooperative Societies 

   • Self Help Groups (SHGs) 

   • Joint Liability Groups (JLGs) 

   • Agri-entrepreneurs 

   • Startups 

   • Central/State Agencies

   • Local Bodies

   • Public-Private Partnership (PPP) projects sponsored by Central/State/Local Governments.

   • APMCs (Agricultural Produce Market Committees) for multiple projects within their designated market area.

      

6. Eligible Projects/Infrastructure: The scheme supports viable projects for:

   • Post-Harvest Management Infrastructure: Warehouses, silos, cold storage, cold chain facilities, pack houses, sorting & grading units, primary processing centers, ripening chambers, assaying units, packaging units, logistics facilities (e.g., reefer vans), farm residue/waste management, and supply chain services including e-marketing platforms. 

   • Community Farming Assets: Integrated primary and secondary processing projects (standalone secondary processing projects are generally covered by MoFPI schemes). 

   • Smart & Precision Agriculture: Purchase of drones, boom sprayers, specialized sensors, Blockchain and AI in agriculture, remote sensing, IoT (e.g., automatic weather stations), farm advisory services through GIS applications. 

   • Others: Nurseries, tissue culture units, seed processing units, Custom Hiring Centers for farm machinery, farm/harvest automation. 

   • Convergence with PM-KUSUM Component-A (solar power plants for farmers).

      

7. Convergence with Other Schemes: AIF can be converged with grants or subsidies from other Central or State government schemes, maximizing financial support for eligible projects. Capital subsidies from other schemes can be considered as the promoter's contribution.

8. Project Monitoring Unit (PMU): A dedicated PMU provides handholding support for projects, including preparation of Detailed Project Reports (DPRs). 

Application Process (Generally via AIF Portal and Lending Institutions):

1. Project Preparation: Develop a detailed project report (DPR) outlining the proposed infrastructure, cost estimates, implementation plan, and expected benefits. Ensure alignment with AIF eligible categories.

2. Bank Selection: Approach any participating financial institution (Scheduled Commercial Banks, Cooperative Banks, Regional Rural Banks (RRBs), Small Finance Banks, NBFCs, NCDC, etc.) that have signed an MoU with NABARD/DA&FW. 

3. Online Application: Submit your application online through the Agriculture Infrastructure Fund portal (agriinfra.dac.gov.in). This involves registration, filling the application form, and uploading the DPR and other required documents. 

4. Loan Processing & Approval: The selected bank will evaluate your application and conduct due diligence. As per scheme guidelines, this should be completed within 60 days from the application date. The Ministry's PMU will also verify the application. 

5. Disbursement & Implementation: Once approved, the loan is disbursed. The interest subvention and credit guarantee fee benefits are managed and claimed by the lending institution on behalf of the beneficiary directly from the government. 

The AIF, with NABARD's backing, is a significant step towards modernizing Indian agriculture, reducing post-harvest losses, and improving farmers' income by creating robust and sustainable agricultural infrastructure.