Union Cabinet approved the expansion of the Agriculture Infrastructure Fund

Current Context: On August 28, 2024, the Union Cabinet, chaired by Prime Minister Narendra Modi, approved the progressive expansion of the Central Sector Scheme of financing under the Agriculture Infrastructure Fund (AIF).

• This strategic move aims to bolster agricultural infrastructure and support the farming community by broadening the scope of eligible projects and integrating additional supportive measures.
• The expansion includes the following key initiatives:
• Viable Farming Assets: All eligible beneficiaries of the scheme can now create infrastructure covered under “viable projects for building community farming assets.” This move is expected to enhance community farming capabilities, improve productivity, and promote sustainability in the sector.
• Integrated Processing Projects: Integrated primary and secondary processing projects are now included in the list of eligible activities under AIF. However, standalone secondary projects would not be eligible and would fall under other schemes.
• PM KUSUM Component-A Convergence: Component-A of PM-KUSUM (Pradhan Mantri Kisan Urja Suraksha evam Utthaan Mahabhiyan) can now converge with AIF for farmers, farmer groups, Farmer Producer Organizations (FPOs), cooperatives, and Panchayats. This alignment promotes sustainable clean energy solutions alongside agricultural infrastructure development.
• NABSanrakshan Credit Guarantee: In addition to the Credit Guarantee Trust Fund for Micro and Small Enterprises (CGTMSE), AIF credit guarantee coverage will extend to FPOs through the NABSanrakshan Trustee Company Pvt. Ltd. This expansion aims to enhance financial security and creditworthiness, encouraging more investments in agricultural infrastructure projects.

Question:

1 Under the expanded Agriculture Infrastructure Fund (AIF) scheme, which type of processing project is now eligible for financing?

• A) Only primary processing projects
• B) Only secondary processing projects
• C) Integrated primary and secondary processing projects
• D) All processing projects are eligible

Answer: C) Integrated primary and secondary processing projects are now included as eligible activities under Agriculture Infrastructure Fund (AIF). However, standalone secondary processing projects are not eligible and fall under other schemes.