Lok Sabha Question No. 248 (STARRED), answered on 2025-03-18
Subject: Access to Agriculture Infrastructure Fund
Ministry: AGRICULTURE AND FARMERS WELFARE
Asked by: Shri Mukeshkumar Chandrakaant Dalal

## GOVERNMENT OF INDIA MINISTRY OF AGRICULTURE AND FARMERS WELFARE

## DEPARTMENT OF AGRICULTURE AND FARMERS WELFARE

## LOK SABHA STARRED QUESTION No.248

TO BE ANSWERED ON THE 18 TH  MARCH, 2025

## ACCESS TO AGRICULTURE INFRASTRUCTURE FUND

## *248.     SHRI MUKESHKUMAR CHANDRAKAANT DALAL:

Will the Minister of AGRICULTURE AND FARMERS WELFARE क ृ िष एवं िकसान कʞाण मंũी be pleased to state:

- (a) the details of the steps taken by the Government to ensure equitable access to financial facilities under Agriculture Infrastructure Fund(AIF) for farmers in remote and underserved areas of Gujarat;
- (b)  the  manner  in  which  the  Government  incentivize  private  investment  in  agricultural infrastructure under the AIF;
- (c) the details of the unique monitoring mechanisms do the Government uses to assess the impact of AIF-funded projects on agricultural productivity;
- (d)the manner in which the Government ensuring the sustainability of agriculture-related infrastructure built under the AIF; and
- (e)  the  details  of  the  steps  that  the  Government  taken  to  simplify  the  loan  application process for eligible beneficiaries under the AIF?

## ANSWER

THE MINISTER OF AGRICULTURE AND FARMERS WELFARE

क ृ िष एवं िकसान कʞाण मंũी (SHRI SHIVRAJ SINGH CHOUHAN)

(a) to (e) : A statement is laid on the Table of the House.

(a): In  order  to  enhance  the  income  of  farmers,  it  is  not  only  essential  to  enhance production and productivity of farm produce but also minimize the post-harvest losses and ensure better realization of prices for farmers through creation of modern post-harvest management infrastructure. With an objective to address the existing gaps in post-harvest management  infrastructure  and  to  promote  viable  farming  assets  in  the  country,  the flagship  scheme  of  Agriculture  Infrastructure  Fund  (AIF)  was  launched  in  2020-21  to strengthen  the  infrastructure  in  the  country  through  creation  of  farm  gate  storage  and logistics infrastructure to enable farmers to store and preserve their farm produce properly and sell them in the market at better price with reduced post-harvest losses and lesser number of intermediaries.

Under AIF,  provision  for  Rs.1  Lakh  crore  loan  has  been  made  through  lending institutions with the a interest rate cap of  9% on loans. The scheme is operational from 2020-21 to 2032-33. All loans under this financing facility have interest subvention of 3% per  annum  up  to  a  loan  limit  of  ₹2  crores.  This  interest  subvention  is  available  for  a maximum period of 7 years. In case of loans beyond ₹2 crores, interest subvention is limited up to ₹2 crores. Credit guarantee coverage is also available for eligible borrowers from  this  financing  facility  under  Credit  Guarantee  Fund  Trust  for  Micro  and  Small Enterprises (CGTMSE) scheme upto a loan of Rs. 2 Crore.  In case of FPOs, the credit guarantee  may  be  availed  from  the  facility  created  under  FPO  promotion  scheme  of DA&FW and NABSanrakshan Trustee Company Pvt. Ltd. However, FPOs are also eligible for reimbursement of credit guarantee fee under AIF. The fee for this coverage is borne by the Government.

The Government has undertaken several initiatives to ensure equitable access to financial facilities under the Agriculture Infrastructure Fund (AIF) for farmers in remote and underserved areas across the country including the State of Gujarat. These measures focus on financial inclusion, digital accessibility, institutional support and targeted outreach to extend AIF benefits to all eligible stakeholders, which are as under:-

## (i) Digital and Banking Access for Remote Farmers

The AIF online portal enables seamless application and tracking of loan requests, reducing the need for physical visits to banks.

Banks  at  the  grassroots  assist  farmers  in  remote  areas  with  documentation, application submission, and grievance resolution.

## (ii) Credit Guarantee and Interest Subvention

Interest  subvention of  3% on loans up to  ₹2 crore in addition  to  the  capping  of interest rate at 9% makes financing more affordable for small and marginal farmers up to 7 years.

Credit guarantee coverage through NABSanrakshan and CGTMSE ensures that farmers with limited collateral can access institutional credit.  Such credit guarantee fee is reimbursed by the Department.

## (iii) Role of Farmer Producer Organizations (FPOs) and Cooperatives

The Government promotes FPOs, PACS, and Cooperative Societies to facilitate collective investments in agri-infrastructure projects.

These  entities  provide  smallholder  farmers  access  to  storage,  processing,  and value-addition facilities, strengthening their market presence.

## (iv) Institutional Support at State and District Levels

State Nodal Officers (SNOs) and District-Level Monitoring Committees (DLMCs) actively promote AIF awareness and streamline the approval process for applicants.

## (v) Awareness and Capacity Building for stakeholders

Training programmes, financial literacy workshops, and AIF awareness campaigns in  local  languages  educate  farmers  on  accessing  AIF  loans  through  Banks  and  other organisations.  Further,  a  dedicated  AIF  helpline  and  grievance  redressal  mechanism provide continuous support to applicants.

By integrating digital banking solutions, institutional frameworks, financial incentives, and grassroots outreach programs, the Government is ensuring that farmers in remote and underserved areas can easily access AIF funding and benefit from modern agricultural infrastructure.

(b):  The Agriculture Infrastructure Fund (AIF) plays a crucial role in incentivizing private investment  in  agricultural  infrastructure  by  offering  a  range  of  financial  and  policy incentives that make investment in the sector more attractive and viable.

(i) Interest Subvention and Credit Guarantee: AIF provides a 3% interest subvention on loans up to ₹2 crore for a maximum period of seven years. Additionally, eligible borrowers gets reimbursement of the fees for credit guarantee coverage under the Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE) and NABSanrakshan, reducing the financial risk for private investors, including agribusinesses, cooperatives, and start ups.

(ii)  Flexible  Loan  Terms and High Credit Flow: With  a  provision  of  ₹1  lakh  crore  in institutional credit, the scheme enables private entities to access affordable medium to long-term loans for setting up post-harvest management and value chain infrastructure such as warehouses, cold storages, sorting and grading units, primary processing centers, and supply chain services and other viable farming assets. The interest rate cap of 9% further enhances the attractiveness of private investment.

(iii)  Support  for  Modern  Agri-Tech Projects: AIF  encourages  private  participation  in advanced and emerging agri-infrastructure sectors such as smart and precision farming, hydroponics,  aeroponics,  bio-stimulant  production,  and  renewable  energy  integration (such as PM-KUSUM solarization). This aligns with the growing demand for sustainable and technology-driven agricultural solutions.

(iv)Public-Private  Partnerships  (PPP)  and  Institutional  Participation: The  scheme allows  private  investors  to  collaborate  with  State  Governments,  local  bodies,  Farmer Producer Organizations (FPOs), and cooperatives to develop agricultural infrastructure under PPP models.  This  approach  helps  in  reducing  investment  risks  and  ensuring  a steady revenue stream.

(v)  State-wise  Fund  Allocation  and  Market  Linkages: The  scheme's  targeted  fund allocation to States and Union Territories ensures that investment is directed where it is needed  most.  Additionally,  AIF-supported  infrastructure  enhances  market  linkages, increasing  profitability  for  private  players  engaged  in  agri-business  and  value  chain management.

Through  these  measures,  AIF  effectively  mobilizes  private  sector  investment, creating a robust ecosystem for modern, scalable, and sustainable agricultural infrastructure.

(c) : The  Government  employs  a  multi-tiered  monitoring  mechanism  to  assess  the impact of Agriculture Infrastructure Fund (AIF)-funded projects on agricultural productivity. These mechanisms ensure real-time tracking, transparency, and effective evaluation of project outcomes. The key monitoring strategies include:

## (i) AIF Online Management Information System (MIS) Portal

The AIF portal provides real-time tracking of projects, from sanction to implementation. It captures data on project approvals, disbursements, and geo-tagging of infrastructure to assess on-ground impact. The portal integrates with various banks and financial institutions for automated loan tracking.

## (ii) Geo-tagging of AIF Projects

Geotagging of AIF projects enables monitoring of physical progress and regional distribution of projects, ensuring proper implementation.

## (iii)Third-party Evaluations & Field Surveys

Independent  agencies  conduct  field  evaluations  to  assess  project  utilization, efficiency, and impact on farm productivity. These surveys help in identifying bottlenecks and suggesting course corrections for better fund utilization. During 2023 Agro-Economic Research Centre (AERC) Pune had undertaken an impact assessment study to analyse the impact of the Scheme in various parameters like employment generation, reduction in post-harvest losses, better farm mechanisation, lesser dependency on middlemen and so on.

## (iv) Stakeholder Consultations & Feedback Mechanism

Regular meetings with Banks, and State Governments ensure real-time feedback on  project  effectiveness.  Issues  faced in  implementation  are  addressed  through  policy interventions and fund reallocation strategies.

## (v) Integration with Agri-Tech and AI-based Analytics

The Government is leveraging AI and data analytics to analyze the impact of AIFfunded  projects  on  yield  improvements,  reduction  in  post-harvest  losses,  and  price realization for farmers. Smart analytics provide insights into how  cold storage, warehouses, and processing units are improving supply chain efficiency.

## (vi) District and State-Level Monitoring Committees

State and District-level Nodal Agencies oversee project implementation and ensure alignment with regional agricultural needs. Periodic performance reviews help in revising strategies for better fund utilization.

Through these comprehensive monitoring mechanisms, the Government ensures that  AIF-funded  projects  are  effectively  contributing  to  agricultural  productivity,  postharvest management, and overall value chain enhancement, thereby benefiting farmers and the agri-business ecosystem.

(d) : The Government ensures the sustainability of agriculture-related infrastructure built under the Agriculture Infrastructure Fund (AIF) through a comprehensive approach that integrates financial, technical, and operational measures.

(i) Affordable Financing and Credit Support: The AIF provides concessional loans with a  3% interest  subvention  for  up  to  seven  years,  along  with  credit  guarantee  coverage under CGTMSE and NABSanrakshan. Addionally the provision for moratorium of 6 months to 2 years also helps beneficiaries manage their finances effectively and ensures the longterm viability of infrastructure projects.

(ii)  Project  Viability  and  Capacity  Building: The  scheme  encourages  feasibility assessments  before  project  sanctioning,  ensuring  that  only  economically  viable  and sustainable projects receive funding. Availability of the tailor-made DPR templates in the AIF Portal helps applicants in check the viability of the project.

(iii) Technology Integration: AIF promotes smart and precision agriculture by supporting modern  technologies  such  as  IoT-based  advisory  systems,  drones,  solar-powered solutions,  and  automated  weather  stations.  These  technologies  enhance  efficiency, optimize resource use, and reduce the environmental impact of agricultural practices.

(iv)  Renewable  Energy  Adoption: Convergence  with  PM-KUSUM  Component-A encourages  the  use  of  solar  energy  in  irrigation  systems  and  agri-processing  units, reducing operational costs and promoting clean energy solutions.

By combining financial incentives, technological advancements, and communitybased approaches, the Government is ensuring that AIF-funded infrastructure remains sustainable, resilient, and beneficial to farmers and rural communities in the long run.

(e) :  The Government has taken several steps to simplify the loan application process under the Agriculture Infrastructure Fund (AIF) to ensure that farmers, agripreneurs, FPOs, and other stakeholders can access financial assistance easily and efficiently. These steps include:

## (i) Online AIF Portal for Seamless Application

A dedicated AIF Digital Platform enables beneficiaries to apply for loans online, reducing paperwork and expediting the approval process. The portal provides a step-by-step guided application  process  for  ease  of  use  by  farmers,  FPOs,  PACS,  and  agri-entrepreneurs. Related help video readily available in the Portal makes the Portal user-friendly.

## (ii) Single-Window Clearance and Integration with Banks

The AIF portal is integrated with almost all the Banks and other financial institutions, allowing  real-time  processing  and  direct  loan  applications.  A  single-window  clearance system has been introduced to streamline approvals and reduce bureaucratic delays.

## (iii) Simplified Documentation and Eligibility Verification

The documentation requirements have been rationalized, ensuring that small and marginal farmers, FPOs, and PACS can apply with minimal paperwork. Integration with Aadhar enables quick verification of applicant credentials.

## (iv) State and District-Level Assistance

State Nodal Officers (SNOs) and District-Level Monitoring Committees (DLMCs) provide on-ground support and guidance to applicants.

A dedicated helpdesk and grievance redressal mechanism assist beneficiaries in resolving application-related issues.

## (v) Credit Guarantee and Risk Mitigation Measures

The Government has simplified collateral requirements by offering credit guarantee support through NABSanrakshan and CGTMSE for loans up to ₹2 crore. This step has particularly benefited small and marginal farmers who may not have high-value assets for loan security.

## (vi) Awareness and Capacity Building Programs

Regular awareness campaigns, training sessions, and workshops are conducted to educate both the Bankers and Beneficiaries on the loan application process.

Banks  and  financial  institutions  are  actively  involved  in  handholding  support  for applicants to ensure smooth processing.

By  leveraging  digital  platforms,  reducing  documentation,  providing  technical assistance, and ensuring easy access to credit, the Government has made the AIF loan application process faster, more transparent, and farmer-friendly.

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