GUJARAT REGIONAL OFFICE, AHMEDABAD SCHEME FOR DEVELOPMENT / STRENGTHENING OF AGRICULTURAL MARKETING INFRASTRUCTURE, GRADING AND STANDARDIZATION (AMIGS) State Level Awareness Programme on AMIGS 11 October 2013 I Session By A Parthava, Manager, NABARD NATIONAL BANK FOR AGRICULTURE & RURAL DEVELOPMENT GUJARAT REGIONAL OFFICE, AHMEDABAD

Scheme for Development / Strengthening of Agricultural Marketing Infrastructure, Grading & Standardisation

Reforms linked investment scheme Central sector scheme effective from 20.10.2004 Scheme guidelines revised w.e.f. 26.06.2008 Scheme is Reform Linked. Applicable only in States/Union Territories, where APMC Act is amended Amended Act allows ‘Direct Marketing’ and ‘Contract Farming’ and to permit agricultural produce markets in private and cooperative sectors. Scheme implemented in Gujarat from 13 August 2007 as per Gazette Notification

Reforms linked investment scheme Objectives To provide additional agricultural marketing infrastructure To promote agricultural marketing infrastructure by private and cooperative sector investments To strengthen existing agricultural marketing infrastructure. To promote direct marketing

Reforms linked investment scheme Objectives (contd) To provide infrastructure facilities for grading, standardization and quality certification of agricultural produce To promote pledge financing and marketing credit Introduction of negotiable warehousing receipt system and promotion of forward and future markets To promote direct integration of processing units with producers

Salient Features Subsidy @ 25% max. Rs.50.00 lakh; Subsidy @ 33.33% max. Rs.60.00 lakh – for NE States, Hilly and Tribal areas, States of Uttarakhand, Himachal Pradesh and Jammu & Kashmir, SC/ST beneficiaries and their co- operatives Subsidy @ 25% or 33.33% (as per eligibility) with no upper ceiling - for State Govt. agencies Credit linkage is optional for projects by State agencies Marketing Infrastructure projects sanctioned to State Govts. under RIDF are also eligible

Salient Features : Pattern of assistance Source of finance General Category NE States, hilly tribal areas, SCST entrepreneurs and their co-operatives Subsidy 25% 33.33% Bank loan Margin money contribution Minimum 50% Rest of the project Cost Minimum 46.67% cost

Salient Features Contd.. Term loan min.50% of TFO (includes subsidy component) Term loan - 46.67% of TFO in case of NE states, hilly and tribal areas and for entrepreneurs belonging to SC/ST and their cooperatives Time limit for completion – 18 months from the date of disbursement of first instalment of loan by financing bank. However if reasons for delay are justified, 6 months grace period may be allowed by the financial institution

Salient Features Contd.. For large projects with TFO of Rs.2.00 crore or more and requiring phasing, time limit for completion - 36 months Subsidy through NABARD only for projects financed by institutions eligible for refinance. Eligible institutions include CBs, Coop. banks and RRBs, ADFCs, scheduled PCBs Hilly areas – places with altitude of more than 1000 metres above MSL

Salient Features Contd.. Tribal areas – areas notified/ declared as tribal areas by Central/State Govt. Any activity pertaining to Post harvest management providing direct service delivery to farmers and involving no product form change is eligible for subsidy. In addition to compulsory direct service delivery, the projects could also be utilised for self purpose during lean period No JMV for projects of TFO below Rs.10 lakh. Full and Final Subsidy could be released in one instalment.

Eligible Marketing Infrastructure Functional Infrastructure for assembling, drying, cleaning, grading, standardisation and quality certification, labeling, packaging, value addition facilities (without change of form) Market users common facilities like market yards, platforms for loading, assembling and auctioning of the produce, weighing etc.

Eligible Marketing Infrastructure (contd.) Infrastructure for Direct marketing of agricultural commodities from producers to consumers/processing units/bulk buyers etc. Infrastructure for E-trading, market intelligence, extension etc. Infrastructure for post harvest operations (excluding transport vehicles) Infrastructure for supply of production inputs and need based services to the farmers.

Eligible persons/institutions Assistance will be available to Individuals Group of farmers/growers/consumers Partnership/Proprietary firms Non-Government Organizations (NGOs) Self Help Groups (SHGs) Companies Corporations Autonomous Bodies of Government Cooperatives, Cooperative Marketing Federations APMCs & Marketing Boards

Land and Location Entrepreneur will be free to locate the marketing infrastructure project at any place of his choice. No restriction on location. Land cost will be restricted to a maximum of 10% of project cost in rural areas and 20% in municipal areas and it would form part of the owner’s contribution. Entrepreneur will not alienate the land during the period of the loan for any purpose other than the purpose for which the loan is sanctioned.

Stipulation not applicable to State Agencies Credit Linkage Term Loan Minimum 50% / 46.67% Stipulation not applicable to State Agencies Repayment in 11 yrs with 2 yrs grace period Repayment schedule prescribed at the time of sanction of the project will not be allowed to be altered by the financing bank without the prior approval of Head office of DMI on the recommendation of NABARD

Credit Linkage (contd.) Term Loan Working capital could also be provided but only capital cost/term loan considered for subsidy Back-ended subsidy No Lock in period prescribed in the scheme

Agencies will adhere to their own appraisal norms Other Modalities Mode of Release 50% - Advance Subsidy Remaining 50% - after JMV Agencies will adhere to their own appraisal norms Insurance of the unit - Responsibility of owner Signboard

Procedure for sanction & release of subsidy Bank to sanction loan & release first installment Submit Annexure I and other documents to NABARD for advance subsidy. NABARD sanctions subsidy and send to GoI. On receipt of funds from GoI, subsidy released On release from NB, banks credit to SRF A/c Banks not to charge interest on subsidy amount from date of receipt of subsidy.

Procedure for sanction & release of subsidy (contd) On completion, banks to submit request to NABARD for JMV alongwith completion documents. On receipt of letter from NABARD, coordinate for conduct of JMV. JMV team comprises of THREE members Official from DMI Official from NABARD Financing Banker – Branch Manager After JMV, banks to submit Annexure II alongwith original JMV Report for claiming final subsidy Last but not least, banks have to submit Utilization Certificate after full amount of subsidy is received and utilized.

Type of Projects sanctioned in Gujarat The projects sanctioned under the Scheme in Gujarat include: Market yard Bulk Milk Coolers Cleaning, Sortex Machines Cotton Ginning units (not oil mills) Weigh Bridge Animal Cess Market Upgradation of agro commodities Frizzing of Fruits and Vegetables

Progress of Scheme in Gujarat (31.03.12) No. of projects sanctioned : 330 TFO of projects : Rs.36419 lakh Bank Loan : Rs.23255 lakh Eligible Subsidy : Rs.7257 lakh Advance Subsidy released : Rs.3391 lakh Final Subsidy released : Rs.866 lakh Total Subsidy released : Rs.4257 lakh

Thank You for Your Attention !!!