CAPITAL INVESTMENT SUBSIDY SCHEME FOR CONSTRUCTION/ RENOVATION/EXTENSION OF RURAL GODOWNS

In order to provide suitable and scientific storage facility a capital investment subsidy scheme for construction/renovation/expansion of rural godowns has been introduced. The NABARD is the nodal agency for providing subsidy to the borrowers through banks. 

ELIGIBILITY : 

1) Proprietary and partnership firms

2) Co-operatives 

3) Companies

4) Corporations

5) Agro Processing Co-operative Societies

6) Agricultural Produce Marketing Committees

7) Agro Industrial Corporations

8) Group of farmers/growers 

9) NGOs 

10) Individuals/farmers

11) Agro Processing Corporations

12) Self Help Groups

13) Marketing Boards etc.

Subsidy for renovation/expansion of rural godowns is available only for godowns constructed by co-operatives.

LOCATIONS : 
The entrepreneur will be free to construct godown at any place and of any size as per his commercial judgment. However, subsidy will be released only for godowns:

constructed outside the limits of Municipal Corporation area and

which have a minimum capacity of 100 M.T.

TECHNICAL REQUIREMENT:
The godown built under the scheme should be structurally sound and functionally suitable to store the agricultural produce. The construction shall be as per Public Works Department specifications or any other specifications laid down in this behalf.

LOAN AMOUNT:    
75% cost of construction is allowed as loan under the scheme. 25% margin money will be paid by the borrower.Subsidy @ 25% of the project cost will be made available by the Govt. of India through NABARD. Thus the actual bank loan will be 50% of the construction cost.

SUBSIDY:
As the subsidy is back ended, eligible amount of subsidy (25%) would be initially allowed as term loan to the beneficiary. The repayment schedule will be drawn on the total loan amount (including subsidy) in such a way that the subsidy amount is adjusted after liquidation of net bank loan (excluding subsidy). No interest shall be charged by the bank on subsidy portion.

 

i)        Pattern of assistance :            
 

  Other than north eastern states In north-eastern states & hilly areas
a) Owner's Contribution  25%  20%
b) Subsidy from Govt.  25%
(max. Rs.37.50 lacs)		 33.33%
(max.Rs.50/-lac)
c) Institutional Loan 50% 46.67%

          
VIABILITY OF THE SCHEME :
The viability of the scheme will depend on the optimum capacity utilization and need to be examined at the time of appraisal of the project.
The income for godown owner will be generated only by way of rentals from goods/farm produce so stored. The farmers will also be able to borrow in case of need by pledge of godown receipts upto 75% of the value of produce subject to a ceiling of Rs.5 lacs per borrower for a period not exceeding 12 months. 

REPAYMENT PERIOD :
The repayment period will depend upon the cash flow and will be upto 11 years including a grace period of one year. 

RATE OF INTEREST :
As per RBI guidelines.

SECURITY :
Primary security of the land and the godowns constructed thereon by creating  mortgage charge.

INSURANCE :
The godowns including stock therein are to be fully insured against all possible risks.

REFINANCE FROM NABARD :
The refinance assistance @ 90% of the term loan is  available from NABARD.

MONITORING  :
The monitoring of the projects shall be done by Directorate of Marketing and Inspection (DMI) through its regional/sub-office and review will be done on monthly basis with NABARD/National Co-operative Development Corporation (NCDC). 

PROJECT COST :
The promoter will submit project proposal for term loans and subsidy to the bank on application form alongwith project report and other documents.

FINANCING FOR RAIN WATER HARVESTING STRUCTURES IN MADHYA SCHEME PRADESH /CHHATTISGARH

To avail the loan against his own for produce stored in the godown.

MARGIN:
The farmer's contribution will be 15% only. 

REPAYMENT :
15 years including  grace  period of one year.

The NABARD has formulated the scheme for M.P. and Chhattisgarh states under water conservation and harvesting initiatives which can be taken up on the farmers' private lands. These are farm ponds, recharge of dug wells and similar structures taken up independently or a combine there of. Recently we have introduced the scheme in our bank for implementation. It will be useful for all drought prone regions.

The bank's finance will be available for the following structures :-

FARM POND :
These ponds are the bodies of water made either by constructing a dam or an embankment across the water course or by creating a dug out to collect and store run-off water during  rainy season. The benefit would accrue directly to the farmers. Two models have been prepared primarily on the basis of usage of pond water. They are

Farm pond for irrigation purpose.

Farm pond for both irrigation and fish farming.


DUG WELL RECHARGE:
The object is to augment the ground water source through artificial recharge  mechanism by  harvesting  rain water on private land. The loan is available for recharge with finance for new dug wells and for recharge in old dug wells. 

DIRECT RECHARGE STRUCTURE KUNDI/KUIYA/DABRA - DABRI.
These structures are mainly intended for recharge of ground water. The structure shall be constructed in the lower portion of the farmer's field with focus on such areas where aquifer of sufficient thickness and adequate permeability is available. 

COST OF CONSTRUCTION :
The cost of construction for the above structures have been worked out for the various models on the basis of NABARD guidelines.


ELIGIBILITY :
Farmers having private land holdings and repayment on the basis of income generation.

GENERAL TERMS AND CONDITIONS: 

1.       They are common for the structures. The bank will also provide crop loan facilities to the farmers taking up the scheme. 

2.       Rate of Interest: 

          As per RBI guidelines. 

3.       Margin:         

          As per RBI/NABARD norms. 

4.       Security : 

          Registered mortgage of land. 

5.       Repayment period : 

          (a)     Farm Pond:  8 years including 23 months grace period. 

          (b)     Dugwell recharge structure : 

              

11 years with 23 months grace period (wherever the financing is made in conjunction with new dug well). 

3 years with no grace period (wherever the financing is made in respect of an existing dug well).


SCHEME FOR FINANCING FARMERS FOR
PURCHASE OF LAND FOR AGRICULTURAL PURPOSE

There is need to finance farmers for purchasing land to expand activities and make existing small and marginal units economically viable. This would enable to diversify their present activities and take up allied activities.

 OBJECTIVES  : 

To make the small and marginal holdings economically viable.

To bring fallow lands and waste lands under cultivation.

To step up agricultural production and productivity.

To finance the share croppers/tenant farmers to purchase land to enable them to increase their income.

ELIGIBILITY : 

(i)      Small and marginal farmers i.e. those who would own maximum of 5 acres of non-irrigated or 2.5 acres of irrigated land including the proposed land to be purchase under the scheme.

Share croppers/Tenant farmers.

PURPOSE  :

The objective of the Scheme is to finance the farmers to purchase, develop and cultivate agricultural as well as fallow and waste land. Banks may also consider financing purchase of land for establishing or diversifying into other allied activities. Complete details of the project proposal of the farmer will be obtained by the bank while considering finance for purchase of land.

MARGIN :

The margin will be minimum of 15%. Maximum Loan amount Rs. 5.00 lacs.

SECURITY :

The existing land owned and land purchased out of the bank finance will be mortgaged in favour of the Bank, which will form the security for the bank loan.

INTEREST RATE :

As per the RBI directives from time to time.

REPAYMENT PERIOD :

9 to 10 Years including grace period or 24 Months.