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Govt unveils agri startup fund and investment portal
AgriSure, a ₹750-crore fund to support startups, and Krishi Nivesh Nidhi, the portal to speedily clear project proposals, will help to boost farm incomes
Union agriculture minister Shivraj Singh Chouhan on Tuesday launched two initiatives — a fund aimed at boosting farm-sector startups, and a single-window portal to process investments — as part of a slew of measures being taken by Prime Minister Narendra Modi-led government in its third term to bolster the farm economy.
AgriSure, a ₹750-crore fund to support startups, and Krishi Nivesh Nidhi, the portal to speedily clear project proposals, will help to boost farm incomes, Chouhan said at an event in the national capital, attended by bankers, investors and startup incubators.
The minister also gave away awards to scheduled banks based on credit disbursals under the government’s agriculture infrastructure fund, which finances rural assets. The first prize went to the State Bank of India, the country’s largest lender, followed by HDFC Bank, which came second, and Canara Bank, which was placed third.
“The agriculture sector is the backbone of the Indian economy and farmers are its soul. Agriculture has a share of 16% in the country’s GDP. The farmer is the biggest producer as well as consumer,” Chouhan said.
PM Modi aims to double farmers’ incomes for which the government has adopted a six-pronged strategy, the minister said. These are increasing output, lowering input costs, ensuring profitable prices, crop diversification, natural farming and value addition to crops, he elaborated.
AgriSure is a blended capital fund, with an equal contribution of ₹250 crore each from the department of agriculture and NABARD, the state-owned rural development bank. An additional amount of ₹250 crore will be raised through financial institutions, an official said. The fund will be managed by NabVentures, a wholly-owned subsidiary of NABARD.
AgriSure will fund startups and agripreneurs through sector-specific as well as sector-agnostic support through alternative investment funds. The fund will offer both equity and debt support, focusing on high-risk, high-impact activities in the agriculture value chain, according to an official statement.
The Union minister said several programmes have been launched to transform agriculture, including expanding storage and processing to cut down post-harvest losses. Chouhan added the agriculture infrastructure fund had mobilised projects worth ₹78,000 crore with financing worth ₹45,000 crore so far.
On August 28, the Union Cabinet had approved an expansion of areas covered by the agriculture infrastructure fund, a central-sector scheme launched in 2020 for financing rural infrastructure.
The ₹1-lakh crore fund is primarily aimed at creating durable farm assets, from warehouses to processing plants. The fund can also be utilised by agricultural produce marketing committees — government-run market yards — for buying and selling of farm produce to spruce up market facilities.
The fund, which was launched as part of the ₹20-lakh crore first stimulus package during the Covid-19 crisis, aims to offer medium-to-long term debt financing for investments in rural projects. The financing facility provides loans on easy terms totalling ₹1 lakh crore over four years, starting with a sanction of ₹10,000 crore for 2020-21 and ₹30,000 crore each for the next three financial years.
Borrowers get an interest subvention, where part of the interest is paid by the government, of 3% per annum up to a loan limit of ₹2 crore for a period of seven years.
