Animal Husbandry Infrastructure Development Fund

Animal Husbandry Infrastructure Development Fund | UPSC

HEADLINES:

Cabinet approves establishment of Animal Husbandry Infrastructure Development Fund

WHY IN NEWS:

In pursuance of recently announced Atma Nirbhar Bharat Abhiyan stimulus package for ensuring growth in several sectors, the Cabinet Committee on Economic Affairs, chaired by Prime Minister Shri Narendra Modi, has approved setting up of Animal Husbandry Infrastructure Development Fund (AHIDF) worth Rs. 15000 crore.

MINISTRY? :-Cabinet Committee on Economic Affairs (CCEA)

SYLLABUS COVERED: GS 2 : 3 : Governance : Recent Developments

LEARNING:

For PRELIMS look out for the aim , beneficiaries of this fund , scheme of propagation and vision of this fund .

For MAINS dairy sector will be one among the worst hit sector post COVID-19 . Can you suggest some more measures to double the farmers income by 2022 .

ISSUE:

Government has been implementing several schemes for incentivizing the investment made by dairy cooperative sector for development of dairy infrastructure.

NEED ?

Government realizes that even MSMEs and Private companies also need to be promoted and incentivized for their involvement in processing and value addition infrastructure.

AIM

AHIDF would facilitate much needed incentivisation of investments in establishment of :

Infrastructure for dairy.
Meat processing and
Value addition infrastructure and
Establishment of animal feed plant in the private sector.

BENEFICIARIES :

Farmer Producer Organizations (FPOs)
MSMEs
Section 8 Companies
Private Companies and individual entrepreneur with minimum 10% margin money contribution by them.

FUNDING :

The project outlay is worth Rs. 15000 crore.
Government of India will provide 3% interest subvention to eligible beneficiaries.
The balance 90% would be the loan component to be made available by scheduled banks.

TIME PERIOD :

There will be 2 years moratorium period for principal loan amount and 6 years repayment period thereafter.
Government of India would also set up 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 upto 25% of Credit facility of borrower.

There is huge potential waiting to be unlocked in investment through private sector.

FUND UTILIZATION :

The INR 15,000 cr. AHIDF and the interest subvention scheme for private investors will ensure availability of capital to meet upfront investment .
Such investments in processing and value addition infrastructure by eligible beneficiaries would also promote export of these processed and value added commodities.

IASbhai WINDUP:

Since, almost 50-60% of final value of dairy output in India flows back to farmers, therefore, growth in this sector can have significant direct impact on farmer’s income.
Size of dairy market and farmers’ realization from milk sales is closely linked with development of organized off-take by cooperative and private dairies.
AHIDF will leverage 7 times private investment but would also motivate farmers to invest more on inputs .

SOURCES:THE HINDU & PIB | Animal Husbandry Infrastructure Development Fund | UPSC

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