Introduction
Agriculture is the backbone of the Indian economy, contributing significantly to GDP and employment. However, inadequate post-harvest infrastructure, lack of storage facilities, and inefficient supply chains often lead to significant losses. To address these issues, the Government of India launched the Agriculture Infrastructure Fund (AIF) in 2020 as a long-term debt financing initiative to develop farm-gate and post-harvest infrastructure.
Overview of Agriculture Infrastructure Fund (AIF)
| Feature | Details |
|---|---|
| Launch Year | 2020 |
| Tenure | 10 years (2020-2030) |
| Total Corpus | ₹1,00,000 crore |
| Loan Interest Subvention | 3% per annum (up to ₹2 crore) |
| Credit Guarantee Coverage | Up to ₹2 crore under CGTMSE |
| Repayment Period | Up to 7 years (including moratorium) |
| Implementing Ministry | Ministry of Agriculture & Farmers Welfare |
| Target Beneficiaries | Farmers, FPOs, SHGs, PACS, Agri-Entrepreneurs\ |
What is the Agriculture Infrastructure Fund (AIF)?
The Agriculture Infrastructure Fund (AIF) is a ₹1 lakh crore Central Sector Scheme (CSS) designed to provide medium to long-term debt financing for agricultural infrastructure projects. It supports projects related to post-harvest management, storage, processing, and market linkage facilities.
Key Features of AIF:
- Tenure:
- 10 years (2020–2030)
- Corpus:
- ₹1,00,000 crore
- Loan Interest Subvention:
- 3% per annum (up to ₹2 crore)
- Credit Guarantee Coverage:
- Up to ₹2 crore under CGTMSE
- Repayment Period:
- 7 years (including moratorium)
- Target Beneficiaries:
- Farmers, FPOs, SHGs, PACs, Agri-entrepreneurs
AIF provides a boost to rural economy by developing storage, cold chain, processing units, and other critical agri-infrastructure, reducing post-harvest losses and enhancing value addition.
Loan & Financial Assistance
| Particulars | Details |
|---|---|
| Total Fund Allocation | ₹1,00,000 crore |
| Maximum Loan Amount | No fixed limit (subvention up to ₹2 crore) |
| Interest Subvention | 3% per annum (up to ₹2 crore loan) |
| Credit Guarantee | CGTMSE coverage for loans up to ₹2 crore |
| Repayment Period | Up to 7 years (including moratorium) |
| Moratorium Period | Up to 2 years |
Objectives of the Agriculture Infrastructure Fund
The AIF scheme aims to:
- Develop post-harvest infrastructure to minimize crop wastage.
- Strengthen agricultural supply chains by supporting storage, logistics, and processing units.
- Increase farmers’ income by providing access to better storage and market facilities.
- Promote private sector investment in agriculture infrastructure.
- Enhance food security through efficient post-harvest management.
- Encourage technological advancements in farming, processing, and logistics.
- Support Farmer Producer Organizations (FPOs) in setting up community-based infrastructure.
By addressing these critical needs, AIF is helping India transition from a production-centric approach to a market-driven agribusiness model.
Eligible Projects under AIF
A wide range of post-harvest infrastructure projects are covered under AIF, including:
1. Farm-Gate Infrastructure
- Primary processing units (cleaning, sorting, grading)
- Packhouses and ripening chambers
- Cold storage units
2. Storage & Warehousing
- Modern silos, warehouses, godowns
- Cold chains and refrigerated transportation
- Rural and community-based storage structures
3. Processing & Value Addition
- Food processing units (milling, dairy, meat, fisheries)
- Primary and secondary processing industries
- Agri-logistics and transport hubs
4. Supply Chain & Market Linkages
- e-NAM-compatible infrastructure
- Market yards and rural haats
- Integrated supply chain facilities
5. Smart & Digital Agriculture
- Precision farming infrastructure
- IoT and AI-based farm monitoring
- Agri-tech startups in post-harvest management
These projects help in improving efficiency, reducing losses, and ensuring better price realization for farmers.
Eligible Infrastructure & Activities
| Category | Examples |
|---|---|
| Post-Harvest Infrastructure | Warehouses, silos, cold storage units |
| Processing & Value Addition | Rice mills, flour mills, dairy processing, food parks |
| Supply Chain & Logistics | e-NAM-compatible storage, market yards, rural haats |
| Smart & Digital Agri Solutions | IoT-based farm monitoring, AI-powered agri-tech solutions |
| Renewable Energy for Agri Use | Solar-powered cold storage, biogas plants |
Eligible Beneficiaries Under AI
| Category | Eligible Entities |
|---|---|
| Individual Farmers | Small & marginal farmers, agri-entrepreneurs |
| Farmer Producer Organizations (FPOs) | Registered FPOs involved in post-harvest activities |
| Self-Help Groups (SHGs) | Women SHGs, rural cooperative groups |
| Cooperatives & PACS | Primary Agricultural Credit Societies (PACS), agri-cooperatives |
| Agri-Tech Startups | Agri-processing, cold storage, logistics startups |
| Public Sector Units (PSUs) | State agencies involved in agri-infrastructure development |
AIF is designed to support a wide range of stakeholders in the agriculture ecosystem. Eligible entities include:
1. Individual Farmers & Agri-Entrepreneurs
- Small and marginal farmers
- Agripreneurs investing in post-harvest facilities
2. Farmer Producer Organizations (FPOs) & Self-Help Groups (SHGs)
- Registered FPOs
- Self-Help Groups (SHGs) investing in agri-infrastructure
3. Cooperatives & PACS
- Primary Agricultural Credit Societies (PACS)
- Agriculture cooperatives
4. Startups & Agri-Tech Companies
- Agribusiness startups working in farm-to-market solutions
- Private sector entities investing in agri-infra
5. State Agencies & Public Sector Units (PSUs)
- State-level agriculture departments
- Public-Private Partnerships (PPP) for infrastructure development
By covering diverse stakeholders, AIF ensures comprehensive agricultural infrastructure development.
Loan & Financial Assistance Under AIF
AIF provides low-interest loans with attractive financial support.
Key Financial Benefits:
| Particulars | Details |
|---|---|
| Loan Amount | ₹1 lakh crore total allocation |
| Interest Subvention | 3% per annum (up to ₹2 crore) |
| Credit Guarantee | Up to ₹2 crore under CGTMSE |
| Repayment Period | 7 years (including moratorium) |
| Maximum Moratorium | 2 years |
For projects requiring more than ₹2 crore, interest subvention is limited to ₹2 crore, but additional loan amounts are available at market rates.
Impact of Agriculture Infrastructure Fund (AIF) So Far
| Key Indicator | Impact (2020-2024) |
|---|---|
| Total Loans Sanctioned | ₹40,000+ crore |
| Projects Supported | Thousands of storage & processing units |
| PACS & FPOs Benefitted | 1000+ rural cooperatives upgraded |
| Reduction in Post-Harvest Losses | Significant improvement in storage & logistics |
| Private Investment in Agri-Infrastructure | Increased participation in cold chain & processing |
How to Apply for AIF Loan?
Farmers and agripreneurs can apply for AIF funding through an online application process.
Step-by-Step Application Process:
- Step 1:
- Visit the AIF Portal (https://agriinfra.dac.gov.in/)
- Step 2:
- Register as an individual, FPO, SHG, or cooperative society.
- Step 3:
- Fill in project details (location, infrastructure type, loan requirement).
- Step 4:
- Submit the application to the bank for approval.
- Step 5:
- The bank verifies eligibility and sanctions the loan.
- Step 6:
- Funds are disbursed, and the project is monitored by the bank and government agencies.
The AIF Dashboard helps in tracking loan applications and approvals in real-time.
Impact of Agriculture Infrastructure Fund
The AIF scheme has significantly impacted Indian agriculture.
Key Achievements (2020-2024):
- Over ₹40,000 crore loans sanctioned for infrastructure projects.
- Thousands of PACS & FPOs benefited, improving rural storage capacity.
- Increase in post-harvest processing units, leading to reduced food wastage.
- Boosted investment in smart agri-tech startups and agri-logistics.
The fund has empowered farmers, improved supply chain efficiency, and reduced rural distress.
Challenges & Limitations of AIF
Despite its success, AIF faces some challenges:
- Low awareness among small farmers about the scheme.
- Delayed loan approvals due to bank processing issues.
- Difficulty in land acquisition for large infrastructure projects.
- Limited private sector participation due to regulatory hurdles.
- Need for better monitoring of fund utilization.
Addressing these challenges through policy improvements, faster approvals, and better outreach will enhance AIF’s effectiveness.
Conclusion
The Agriculture Infrastructure Fund (AIF) is a game-changer in India’s agri-sector, providing long-term, low-cost financing for critical infrastructure development. By reducing post-harvest losses, improving storage, and boosting farm-to-market linkages, AIF plays a key role in enhancing farmers’ income and rural development.
To fully realize AIF’s potential, stakeholders must actively participate in availing benefits, investing in modern infrastructure, and driving agri-sector growth.
