Economy
Credit Guarantee Scheme for Livestock Sector
- 25 Jul 2023
- 3 min read
For Prelims: MSMEs, Ministry of Fisheries, Farmers Producers Organizations (FPOs), Interest Subvention scheme.
For Mains: Economics of Animal-Rearing, MSMEs.
Why in News?
The Ministry of Fisheries, Animal Husbandry and Dairying has launched the first ever “Credit Guarantee Scheme” under Animal Husbandry Infrastructure Development Fund (AHIDF) to facilitate collateral-free credit for MSMEs in the livestock sector.
What are the Key Features of the Credit Guarantee Scheme?
- Objective:
- Strengthen credit delivery system and facilitate smooth flow of credit to Micro, Small & Medium Enterprises (MSMEs) engaged in the Livestock sector.
- Increase access to finance for un-served and under-served livestock sector, with a focus on first-generation entrepreneurs and underprivileged sections of society.
- Credit Guarantee Fund Trust:
- A Credit Guarantee Fund Trust of Rs. 750.00 crores have been established to provide credit guarantee coverage up to 25% of the credit facilities extended to eligible MSMEs by lending institutions.
- Interest Subvention:
- The scheme offers an interest subvention of 3% on loans obtained from Scheduled Banks or National Cooperative Development Corporation (NCDC).
- Borrowers can avail up to 90% of the total project cost as a loan.
What is Animal Husbandry Infrastructure Development Fund?
- The AHIDF has been set up as MSMEs and Private companies also need to be promoted and incentivized for their involvement in processing and value addition infrastructure.
- The AHIDF is a Central Sector Scheme under the Prime Minister’s Atma Nirbhar Bharat Abhiyan stimulus package of Rs.15000 crores for incentivizing investments in:
- Dairy processing and value addition infrastructure.
- Meat processing and value addition infrastructure.
- Animal Feed Plant.
- Breed Improvement technology and Breed Multiplication Farm.
- Animal Waste to Wealth Management (Agri Waste Management).
- Setting up of Veterinary Vaccine and Drugs Manufacturing facilities.
- Individual entrepreneurs, private companies, MSMEs, Farmers Producers Organizations (FPOs), and Section 8 companies are encouraged to invest in the Livestock sector through this fund.
UPSC Civil Services Examination, Previous Year Question (PYQ)
Mains
Q. Livestock rearing has a big potential for providing non-farm employment and income in rural areas. Discuss suggesting suitable measures to promote this sector in India. (2015)
