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Budget 2023: Govt introduces startup fund for young agri-entrepreneurs, idea long pushed by RSS

Agriculture Accelerator Fund aims to bring 'innovative & affordable solutions for challenges faced by farmers' and modern technologies to increase productivity & profitability.

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New Delhi: Finance minister Nirmala Sitharaman announced an ‘Agriculture Accelerator Fund’ Wednesday to “encourage agri-startups by young entrepreneurs in rural areas”. The fund is a part of the Narendra Modi government’s efforts to incentivise agriculture and was mentioned by Sitharaman during her 2023 budget speech.

“The fund will aim at bringing innovative and affordable solutions for challenges faced by farmers. It will also bring in modern technologies to transform agricultural practices, increase productivity and profitability,” said Sitharaman. The finance minister added that the Union government will increase the agriculture credit target. The Modi government also increased the allocation for the Agriculture Infrastructure Fund (AIF) from Rs 150 crore in the previous budget, to Rs 500 crore in this budget.

The need to incentivise farming for the young generation and encourage farmers to continue with agriculture, has been previously discussed by Rashtriya Swayamsevak Sangh (RSS) general secretary Dattatreya Hosabale in several agriculture forums. The RSS is the ideological fountainhead of the Bharatiya Janata Party (BJP) currently in power at the Union.

In July last year, while attending an international seminar on agriculture organised in Delhi, Hosabale had said that the foundation of Bharat has been ‘Krishi’. Rapid migration to cities from villages by farmers or farm labourers, who have given up farming, will affect Indian culture adversely.

“Krishi is the foundation of Bharat. It is embedded in Indian culture and society . Agriculture and the farmers should flourish in national interest” Sunil Ambekar, the RSS akhil Bharatiya prachar pramukh (national spokesperson) told ThePrint.

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Focus on building agricultural infrastructure

According to the Agriculture Ministry’s 2023-24 budget document, “AIF was approved by cabinet in July 2020 to provide a medium-long term debt financing facility for investment in viable projects for post-harvest management infrastructure and community farming assets through interest subvention and financial support.”

The document added: “Under the scheme, (Rs) 1 Lakh Crore will be provided by banks and financial institutions as loans to Primary Agricultural Credit Societies (PACS), Marketing Cooperative Societies, Farmer Producers Organizations (FPOs), Self Help Group (SHG), Farmers, Joint Liability Groups (JLG), Multipurpose Cooperative Societies, Agri-entrepreneurs, Startups and Central/State agency or Local Body sponsored Public Private Partnership Project.”

The agriculture ministry’s budget document further added, “All loans under this financing facility will have interest subvention of 3% per annum up to a limit of.. (Rs) 2 crore. This subvention will be available for a maximum period of 7 years. Further, credit guarantee coverage will be available for eligible borrowers from this financing facility under Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE) scheme for a loan up to.. (Rs) 2 crore. The fee for this coverage will be paid by the Government.”

The ministry received allocations for some new programmes in Wednesday’s Union budget, including for an agriculture census.

“Agriculture Census forms part of a broader system of collection of agricultural statistics. It is a large-scale statistical operation for the collection and derivation of quantitative information about the structure of agriculture in the country,” stated the ministry’s budget documents.

The document further explained that the overall objective of the agri economics and statistics schemes is to “collect, compile, and maintain a database of different facets of the agriculture sector, study and analyze the socio-economic conditions of the agricultural sector and provide policy inputs”.

“It is the job of the central government to ensure the viability of agriculture as a business. The sector needs new policy initiatives, so that the farming community is better placed to manage natural risks such as weather, rainfall and so on. We have long been demanding guaranteed income and social respect for the farmers,” a senior RSS functionary lauding the budget.

The functionary added: “Dattatreya ji has also said on many occasions that farmers should get the same social respect (as those in) other professionals, including doctors, professors, engineers, and lawyers etc.”

Talking about the need to retain younger generations in farming and the rural-urban migration, the functionary further said, “for the young generation, (agri) start-ups are a good idea and the government can work to encourage agri start-ups. It will bring the young generation back to their roots and to farming. It will also address the limitless migration from villages to cities.”

(Edited by Poulomi Banerjee)

Also read: Budget 2023: Long-pending dam project in poll-bound Karnataka gets Rs 5,300 crore


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