In pursuance of the recently announced Atma Nirbhar Bharat Abhiyan stimulus package for ensuring growth in several sectors, the Cabinet Committee on Economic Affairs (CCEA), chaired by Prime Minister Narendra Modi, has approved setting up of Animal Husbandry Infrastructure Development Fund (AHIDF) worth Rs. 15,000 crore.
Who Gets AHIDF — Eligible Beneficiaries
Government has been implementing several schemes for incentivising investment made by the dairy cooperative sector. However, the government realises that even MSMEs and Private companies need to be promoted and incentivised for their involvement in processing and value-addition infrastructure. AHIDF would facilitate much-needed incentivisation of investments in dairy and meat processing and value-addition infrastructure and the establishment of animal-feed plants in the private sector.
The eligible beneficiaries under the Scheme would be:
- Farmer Producer Organizations (FPOs)
- MSMEs
- Section 8 Companies
- Private Companies
- Individual entrepreneurs
…with a minimum 10% margin money contribution by them. The balance 90% would be the loan component to be made available by scheduled banks.
CCEA approves AHIDF for processing, value addition and animal-feed plants in the private sector
3% Subvention · 2-Year Moratorium · 6-Year Repayment
Government of India will provide 3% interest subvention to eligible beneficiaries. There will be a 2 years moratorium period for the principal loan amount and a 6 years repayment period thereafter.
₹750 Crore Credit Guarantee Fund — NABARD Managed
Government of India would also set up a Credit Guarantee Fund of Rs. 750 crore to be managed by NABARD. Credit guarantee would be provided to those sanctioned projects which are covered under MSME-defined ceilings. Guarantee Coverage would be up to 25% of the credit facility of a borrower.
7× Private Investment Leverage
There is huge potential waiting to be unlocked in investment through the private sector. The INR 15,000 cr AHIDF and the interest subvention scheme for private investors will ensure the availability of capital to meet upfront investment required for these projects and also help enhance overall returns/payback for investors. Such investments in processing and value-addition infrastructure by eligible beneficiaries would also promote export of these processed and value-added commodities.
Farmer Income Linkage — 50-60% Flowback
Since almost 50-60% of the final value of dairy output in India flows back to farmers, growth in this sector can have a significant direct impact on farmers' income. Size of the dairy market and farmers' realisation from milk sales is closely linked with the development of organised off-take by cooperative and private dairies.
Thus, investment incentivisation in AHIDF would not only leverage 7 times private investment but would also motivate farmers to invest more on inputs thereby driving higher productivity leading to an increase in farmers' income. The measures approved through AHIDF would also help in direct and indirect livelihood creation for 35 lakh.