NABARD is currently providing financial support to PACS by refinancing them at highly subsidized rates of around 1%, after incorporating the 3% interest subvention under AIF scheme for projects up to Rs 2 crore.
To reduce post-harvest losses and protect farmers from distress, the government is aiming to create storage infrastructure for agricultural commodities at around 65,000 primary agricultural credit societies (PACS) in the next couple of years.
The move aims at integrating godowns built at the PACS level with the national food grain supply chain, providing essential market linkages, help farmers store their commodities for longer periods, reduce post harvest losses, avoid multiple handling and transportation costs. Currently, most of the storage facilities by state warehousing corporations and central agencies are not located in rural areas.
“At the initial phase, those PACS which are being computerized will be supported for creating storage facilities,” an official told FE. These storage facilities would expand PACS’s economic viability by diversifying their business activities and generating additional revenue streams.
The move aims at creation of infrastructure including godowns, custom hiring center, processing units, fair price shops through convergence of various existing schemes including agriculture infrastructure fund (AIF), agriculture marketing infrastructure schemes, sub-mission of agricultural mechanisation and Pradhan Mantri formalisation of micro food processing enterprise schemes.
“PACS can avail subsidies and interest subvention benefits for construction of godowns or storage facilities and setting up of other agri infrastructure,” according to a note. NABARD is currently providing financial support to PACS by refinancing them at highly subsidized rates of around 1%, after incorporating the 3% interest subvention under AIF scheme for projects up to Rs 2 crore.
Officials said the department of consumer affairs has given nod to National Cooperative Consumers Federation (NCCF) to use warehouses created by PACS for storing various commodities like pulses, oilseeds, onions, and grains under various government schemes like the price support scheme and price stabilisation fund.
State level cooperatives and national cooperatives such as NCCF and farmers’ cooperative NAFED have identified 1,711 PACS for creation of storage capacity under the pilot project, according to an official note.
“NCCF has signed MoUs with more than 400 PACS for construction in Rajasthan, Maharashtra and Karnataka and Telangana so far and further processing of documents for financing by NABARD and district cooperative banks is on,” an official said
A MoU has been signed between the cooperation ministry, department of food and public distribution, Food Corporation of India and National Cooperative Development Corporation for ensuring utilisation of storage facilities created by PACS. Currently India has a grain storage capacity of about 145 million tonne (MT), with annual agricultural commodities production over 311 MT.
In May, 2023, to address shortage of food grain storage capacity, the government approved ‘world’s largest grain storage plan’ in the cooperative sector, which is currently being rolled out as pilot projects across the country. An official note stated that with the creation of storage facilities at the village level, there will be reduction in post harvest losses from the current level of 6%.
Source:financialexpress.com