Gramin Bhandaran Yojana

It is well known that the small farmers do not have the economic strength to retain the produce with themselves till the market prices are favourable. There has been a felt need in the country to provide the farming community with facilities for scientific storage so that wastage and produce deterioration are avoided and also to enable it to meet its credit requirement without being compelled to sell the produce at a time when the prices are low. A network of rural godowns will enable small farmers to enhance their holding capacity in order to sell their produce at remunerative prices and avoid distress sales. Accordingly, Gramin BhandaranYojana, a capital investment subsidy scheme for construction / renovation of rural godowns was introduced in 2001-2002.

The main objectives of the scheme include creation of scientific storage capacity with allied facilities in rural areas to meet the requirements of farmers for storing farm produce, processed farm produce and agricultural inputs; promotion of grading, standardization and quality control of agricultural produce to improve their marketability; prevention of distress sale immediately after harvest by providing the facility of pledge financing and marketing credit; strengthen agricultural marketing infrastructure in the country by paving the way for the introduction of a national system of warehouse receipts in respect of agricultural commodities stored in such godowns and to reverse the declining trend of investment in agriculture sector by encouraging private and cooperativesectors to invest in the creation of storage infrastructure in the country.

The project for construction of rural godowns can be taken up by individuals, farmers, groups of farmers/growers, firms, non-Government organizations (NGOs), Self Help Groups(SHGs), companies, corporations, co-operatives, federations and agricultural produce marketing committees in the country.

Location

  Under the scheme, the entrepreneur will be free to construct godown at any place, as per his/her commercial judgment except that it should be outside the limits of Municipal Corporation area. Rural godowns constructed in the food parks promoted by the Ministry of Food Processing Industries shall also be eligible under the scheme for assistance.

Size

  Capacity of a godown shall be decided by an entrepreneur. However, Subsidy under the scheme shall be restricted to a capacity of minimum 100 tonnes and maximum 30,000 tonnes. Rural godowns of smaller size upto 50 tonnes capacity will also be eligible for subsidy under the scheme as a special case based on viability analysis. In hilly areas, rural godowns of smaller size upto25 tonnes capacity will also be eligible for subsidy.

Conditions for Scientific Storage

Godowns built under the scheme shall be structurally sound on account of engineering considerations and functionally suitable to store the agricultural produce. The entrepreneur may obtain a licence to operate the godown, if required by the State Government concerned, under the State Warehousing Act or any other relevant laws. The rural godowns of 1,000 tonnes capacity and more should get accreditation from Central Warehousing Cooperation (CWC).

Credit Linked Assistance

Subsidy under the scheme is linked to institutional credit and will be available to only such projects as are financed by commercial banks, Regional Rural Banks, state cooperative banks (SCBs), State Co-operative Agricultural and Rural Development Bank (SCARDBs), Agricultural Development Finance Companies (ADFCs), North Eastern Development Finance Corporation (NEDFI), Urban Cooperative Banks etc. Loan to the entrepreneurs from banks for the construction of godownswould carry an adequate long-term repayment period.

Assistance under the scheme shall be available on capital cost of construction of godown including the cost of allied facilities like boundary wall, internal road, platform, internal drainage system, weighing, grading, packaging, quality certification, warehousing facilities which are functionally required to operate the godown.

Pledge Loan Facility

    The farmers keeping their produce in the godown shall be eligible to avail pledge loan on hypothecation of their produce. The terms and conditions governing  pledge loans, rate of interest, period of pledge, amount etc. will be as per the guidelines issued by RBI/NABARD and as per normal banking practices followed by the financial institutions.

Subsidy

Rate of subsidy shall be:-

(a)    33.33% of the capital cost of the project for SC/ST entrepreneurs and their cooperatives and  in case of projects located in North – Eastern States, hilly areas  subject to a maximum ceiling on subsidy of Rs.3.00 crores.

(b)   25% of the capital cost of the project to all categories of farmers, agriculture graduates and cooperatives subject to a maximum ceiling on subsidy of Rs.2.25 crores.

(c)    15% of the capital cost of the project to all other categories of individuals, companies & corporations etc., subject to a maximum ceiling on subsidy of Rs.1.35 crores.

(d)   25% of the capital cost of the project for renovation of godowns of cooperatives with assistance from NCDC.

Capital cost of the project for the purpose of subsidy under the scheme shall be calculated as follows:

a)      For godowns up to 1000 tonnes capacity – project cost as appraised by financing bank or actual cost or Rs.3500/- pertonne of storage capacity, whichever is lower;

b)      For godowns exceeding 1000 tonnes capacity – project cost as appraised by bank or actual cost or Rs.1500/- per tonneof storage capacity, whichever is lower.

Subsidy shall be released through NABARD for projects financed by commercial, cooperative banks and RRBs. It will be kept in the Subsidy Reserve Fund Account of the financing bank and shall be tax free.

NERAMAC – A Vibrant Agri-Marketing Organization of North East

North Eastern Regional Agricultural Marketing Corporation (NERAMAC) Ltd, is a Government Enterprise under the Ministry of Development of North Eastern Region (DoNER). The Company with an authorized capital of Rs 10.00 Cr and a paid up capital of only Rs 7.62 Cr has registered a sales turnover of Rs. 96 Cr during the just concluded fiscal year 2011-12 with a net profit of Rs 1 Cr.

NERAMAC is playing a significant role by intervening in the sourcing, procuring and marketing of cash crops like ginger, fresh pineapple, cashew nut, Kiwi fruits etc. from the farmers and growers of the North Eastern Region. Its role as a dynamic and vibrant marketing organization essentially to support farmers of North East has started showing visibility through its operations to sustain farmers’ interest in production by application of post harvest technology thereby arresting decline in prices arising from larger output of the farm produces and marketing.

It has also procured and marketed various other items such as turmeric, large cardamom, maize etc, input supplies like fertilizer, assorted seeds, planting materials, floriculture items etc. under the Horticulture Mission for North East & Hill States (HMNEHS) & National Horticulture Mission. It has tied up with reputed companies in the field of setting up of various Horticultural Projects like High-tech green house, tissue culture laboratory, supply of planting materials etc. besides its initiative in supporting tiny and small scale processors in marketing their end products. NERAMAC helped farmers in getting better price of their produce besides procurement of the same. The Corporation has initiated building linkages by tying up through MoU with different farmer’s Societies as well processed products manufacturers having FPO licenses. It has helped building confidence among farmers and producers for a better network of procurement through NERAMAC.

It has taken initiative in involving various stakeholder particularly private sector in the field of processing thereby playing a greater role to tap the market potential for Kiwi and Passion fruit. Linkage were initiated with Passion Fruit Growers Association of Manipur and for procurement of passion fruit from them to make end product with the help of private and women entrepreneurs and marketing them through NERAMAC.  Similiarly, Kiwi fruit was introduced  by sourcing them from Arunachal Pradesh by involving private entrepreneur group.

In order to support the large cardamom growers of Sikkim, NERAMAC has set up a Large Cardamom Auction Centre at Rongpo, Sikkim during the last fiscal. Large cardamom growers are getting immense benefit as it has given them edge in getting value for their produce. Traders from all over the country are coming and participating in this auction program which has given a fillip to the cardamom producers.

NERAMAC has also taken a lead in setting up a outlet at Siliguri Regulated market to make way for produces like oranges and other fresh produces. This has given a facelift to the farmers. Oranges from Wakro and Tezu of Arunachal Pradesh are coming to Assam.

The Company has hosted a series of programs in the North-East to scale up awareness among the budding agri-preneurs, inviting investment on food processing involving national institutes and organizations of repute and large business houses in agro- horticulture processing with the financial support of Ministry of Food Processing Industries & North Eastern Council.

It has organized North East Food Processing Expo, an exhibition for the fruit processors of North East followed with conference and buyers sellers meet at Guwahati during January 2012 where processors from all the North Eastern states participated. This initiative was organised for the first time with the financial support of the Ministry of DoNER.

NERAMAC in association with IIP, Mumbai, organised for the first time in the region,  INDPACK 2012 at Maniram Dewan Trade Centre, Guwahati to support the first generation entrepreneurs of the North East in food processing and value addition. Two food processing entrepreneurs from each state of North East was taken to INDPACK 2011 at Hyderabad to give them the knowledge and expertise in packaging with the support of North Eastern Council.

100 Orange farmers were taken to National Research Centre for Citrus at Nagpur, Maharastra for giving them exposure to better orange production technique & demonstration.

North East Connect program was organised to show case potential of north east at Delhi, Kolkata, Mumbai & Bengaluru seeking investment opportunities as well as create business opportunity for the naturally grown organic produces of North East.

For the first time, an initiative has been taken to set up kiosks at six Malls in the National Capital Region (NCR) Delhi to sell North East produces to the consumers of NCR Delhi. Outlets in the name N E Fresh are located at Shipra mall, EDM mall, Mahugana mall, Sab mall, Star City mall & TDI mall at NCR Delhi. This was followed with weeklong Mall festivals in the beginning.

-PIB

Agripreneurs and Producer Organizations

The concept of an “Agripreneur” is slowly gaining ground in the agriculture sector in the country. The term entrepreneur is quite familiar; so is the term agriculturist. The agripreneur is one who plays the role of an entrepreneur in the field of agriculture.

The National Bank for Agriculture and Rural development (NABARD) is in the fore front of pioneering this concept. Its Assistant General Manager at Madurai, Sankar Narayan says that NABARD is actively working with farmers federations in Usilampatti and Chellampatti to transform agriculturists into agripreneurs.

Producer Organizations

NABARD has floated another concept also called Producers Organizations, as a first step towards the realization of changing farmers into agricultural entrepreneurs or agripreneurs.

A producer organization comprises of a group of producers who have joined hands for the purpose of either agricultural or non agricultural activities. NABARD has specified that it should be a registered legal body. It has also been specified that only actual producers – especially farmers – should be shareholders in the organization.

NABARD will extend support to the producers’ organizations by providing term loan and working capital, support to capacity building and help in the creation of marketing linkages. Support in terms of loan and grant is available to any registered producer company, cooperatives, registered farmers federations, etc.  Under the Financial Intervention schemes of the Government, NABARD will also provide loans directly to the producer organizations. These loans can either be term loans or composite loans comprising of both working capital and term loan requirements.

Since many of these newly formed producer organizations may not be very familiar with processes and procedures of availing loans, subsidies etc., and since many of them may lack the soft skills to become a full fledged Agripreneur, NABARD will also extend grant support for need based skill building,  guide business planning and support technological extension through classroom training, exposure visits, agricultural university tie ups, expert meetings, etc., For marketing efforts of the producer organization, NABARD will provide assistance  for setting up of marketing infrastructure facilities for sale of produce.

PODF

An Organization Development Fund –  a dedicated fund by the name ‘Producers Organization Development Fund (PODF) – has also been set up in this connection by NABARD. The main purpose of this fund is to support comprehensively the various producer organizations in different forms across the country.

As Sankar Narayan explains “farmers have not only to adopt latest technological practices, but they should also have access to all the necessary resources. For instance, they should collectively source inputs, own farm implements and give out on hire to fellow farmers and even sell their produce collectively so that they command the best price. All this requires unity and mobilization for which NABARD encourages formation of farmers clubs, joint liability groups and farmers club federations – all of which can eventually take the shape of producer organizations.

S.Natarajan, DGM, NABARD, Madurai said that farmers’ federations and NGOs functioning in a transparent manner should take advantage of the support available for producers’ organizations. When the entire farming community is craving for better farm income, this concept will help in empowering them and give them the crucial hold on pricing decisions. However, professional functioning will be a key factor, when the organisations are assessed for support by NABARD. With flexible interest rates and support for capacity building, this product from NABARD will be a win-win.

Views from Some Producers Organizations

Banana Ripening Chambers for the banana growers of Varadarajapuram, Tiruchi, Coffee growers in Dindigul, Drip Irrigation in Tirunelveli Cotton ginning in Ramanathapuram etc. are some of the examples of producers organizations that are on the way to becoming very good agripreneurs.

Perumal from the OPR Federation in Tirunelveli says that “support from NABARD has helped us cover our entire village under the novel DRIP irrigation technology and thereby survive on scarce water. This support also helped us to bring in convergence in the form of subsidy support from the horticulture and other departments.

Kanakama and Krishnaveni from Dindugul say confidently that the concept of agripreneurs is indeed a workable and practical one. They have pointed out that even woman’s self help groups have been able to maximize their income in a more efficient manner through the networking with various producers’ organizations.
-PIB