The Cabinet Committee on Economic Affairs (CCEA) approved initial corpus of Rs.5,000 crore for setting up of dedicated Micro Irrigation Fund (MIF) in NABARD under Pradhan Mantri Krishi Sinchayee Yojana (PMKSY).
Key Facts
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The allocation of MIF under PMKSY will be made in instalments of Rs 2,000 crore and Rs 3,000 crore in 2018-19 and 2019-20.
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Under it, NABARD will extend loans to state governments during this period.
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The lending rate under MIF has been proposed at 3% lower than cost of raising fund by NABARD.
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States will pay back loans in total seven years period, including grace period of two years.
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The total financial implication on interest subvention from MIF will be about Rs. 750 crore.
Benefits
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The dedicated MIF will supplement efforts of Per Drop More Crop (PDMC) Component of PMKSY in an effective and timely manner.
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It will help to bring about 10 lakh ha of land under irrigation through innovative composite, community and cluster based micro irrigation projects with additional investment in MIF.
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The MIF will facilitate states to mobilise resources for their initiatives, including additional (top up subsidy) in implementation of PMKSY-PDMC to achieve annual target of about 2 Million ha per year during remaining period of 14th Finance Commission under PDMC component of PMKSY as recommended by Group of Secretaries.
Implementation Strategy
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States may access MIF for innovative integrated irrigation projects, including projects in Public Private Partnership (PPP) mode.
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They may also use it for incentivizing micro irrigation through additional (top up) subsidy over and above one available under PMKSY-PDMC Guidelines and for covering additional areas.
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Farmers Producers Organization (FPO), Cooperatives and State Level Agencies can also access funds with Guarantee of State Government or equivalent collateral.
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Farmers Co-operatives can also access this fund for innovative cluster based Community Irrigation Projects.
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Advisory Committee will be constituted to provide policy direction and ensure effective planning, coordination and monitoring projects along with Steering Committee for examining and approving these projects from state governments.
Coverage
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Micro Irrigation Fund (MIF) will have pan India coverage.
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States lagging behind in adoption of micro irrigation will be encouraged to take advantage of fund for incentivizing farmers.
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Besides, community driven and innovative projects will be taken up by state will be provided loans to bring additional coverage of micro irrigation.