The Ministry of Fisheries, Animal Husbandry and Dairying is spearheading a novel initiative to bolster the Micro, Small & Medium Enterprises (MSMEs) involved in the livestock sector. This comes as the first-ever “Credit Guarantee Scheme,” falling under the Animal Husbandry Infrastructure Development Fund (AHIDF), which aims to provide collateral-free credit facilities. This significant move will assist in strengthening the credit delivery system, enhancing finance accessibility for un-served and under-served livestock sectors, with an emphasis on first-generation entrepreneurs and economically disadvantaged sections.
Key Features of the Credit Guarantee Scheme
The scheme’s primary objective is to fortify the credit delivery system and facilitate the smooth flow of credit to MSMEs in the Livestock sector. Further, it aims to enhance access to finance for the less-served parts of the livestock sector, with a particular focus on budding entrepreneurs and underprivileged communities.
A Credit Guarantee Fund Trust worth Rs.750.00 crores has been established under the scheme to provide credit guarantee coverage up to 25% of the credit facilities rendered to eligible MSMEs by lending institutions. The scheme also offers an interest subvention of 3%, applicable on loans obtained from Scheduled Banks or the National Cooperative Development Corporation (NCDC). Therefore, borrowers can avail themselves of up to 90% of the total project cost as a loan.
About Animal Husbandry Infrastructure Development Fund (AHIDF)
The AHIDF is an initiative devised to encourage and incentivize MSMEs and private companies to engage in processing and value addition infrastructure. This fund is part of the Central Sector Scheme under Prime Minister’s Atma Nirbhar Bharat Abhiyan stimulus package worth Rs.15000 crores, targeted to promote investments in multiple sectors.
The sectors include dairy processing and value addition infrastructure, meat processing and value addition infrastructure, and animal feed plant. It also supports breed improvement technology and breed multiplication farm, management of animal waste to wealth (Agri Waste Management), and setting up of veterinary vaccine and drugs manufacturing facilities.
Encouragement to Invest in Livestock sector
Investments from individual entrepreneurs, private companies, MSMEs, Farmers Producers Organizations (FPOs), and Section 8 companies are welcomed and highly encouraged through this fund. This move is projected to greatly boost the involvement and innovation within the Livestock sector, paving the way for significant economic and infrastructural growth.
UPSC Civil Services Examination – Previous Year Question (PYQ) Mains Question
A question from the 2015 UPSC Civil Services Examination Mains asked candidates to discuss how livestock rearing has massive potential for providing non-farm employment and income in rural areas, suggesting suitable measures to promote this sector in India. As evident from the recent moves made by the Ministry of Fisheries, Animal Husbandry, and Dairying, promoting financial accessibility and infrastructural development within the livestock sector has been prioritized to unlock its full potential.
