AGRICULTURE INFRASTRUCTURE FUND (AIF) (Syllabus: GS Paper 3 – Economy)

Context: The union cabinet expanded the scope of the 1 lakh crore Agriculture Infrastructure Fund (AIF).

Agriculture Infrastructure Fund (AIF)

• About: It is a central sector scheme that will enable a financing facility of Rs.1 lakh crore for funding agriculture infrastructure projects at farm-gate and aggregation points.
• Origin: It was announced in May 2020 under the ambitious Atma Nirbhar Bharat Package as a dedicated Central Government scheme that provides medium-long term credit facility for investment in creation of post-harvest management infrastructure and community farming assets.
• Nodal Ministry: Ministry of Agriculture and Farmers Welfare.
• Objective: To mobilize a medium to long term debt financing facility for investment in viable projects for post-harvest management Infrastructure and community farming assets through incentives and financial support in order to improve agriculture infrastructure in the country.

• To enhance and strengthen the agricultural infrastructure in the country and support the farming community, the Government has announced a series of measures to expand the scope of Agricultural Infrastructure Fund (AIF) scheme:

oViable Farming Assets: To allow all eligible beneficiaries of scheme for creation of infrastructure covered under 'viable projects for building community farming assets'. 

oIntegrated Processing projects: To include integrated primary secondary processing projects in list of eligible activities under AIF. 

oPM KUSUM Component-A: To allow convergence of Component-A of PM-KUSUM with AIF for farmer/group of farmers/ Farmer Producer Organizations/ Cooperatives/ Panchayats. 

üThe alignment of these initiatives aims to promote sustainable clean energy solutions alongside the development of agricultural infrastructure.

oNABSanrakshan: In addition to CGTMSE, it is proposed to extend AIF credit guarantee coverage of FPOs through the NABSanrakshan Trustee Company Pvt. Ltd. also. 

üThis expansion of credit guarantee options is intended to enhance the financial security and creditworthiness of FPOs, thereby encouraging more investments in agricultural infrastructure projects.