Recently, Agriculture Minister Shivraj Singh Chauhan, during the Rajya Sabha session, assured considering an enhancement in the Agriculture Infrastructure Fund (AIF) given to Farmer Producer Organisations (FPOs), Agri Enterprises and Cooperative Societies to Rs five crore, mainly for post-harvest operations.The minister was replying to Member of Parliament Vikramjit Singh Sahney who sought that the amount be enhanced to Rs five crore, saying the current cap limit of Rs two crore was not enough for an operable large-scale agri-infrastructure project. The demand on February 19 came after the Centre had doubled the AIF loan amount from Rs one crore to Rs two crore on February 13, earlier this month.Aimed at better storage and processing facilities after reducing food wastage, the AIF was introduced in 2020-2021 by the Centre for the post-harvest infrastructure (cold chains, warehouses) and community farming assets (precision farming and processing units).Sahney is referring to big costs involved in setting up of warehouses, cold chains, processing units, silos and primary processing units besides the crop movement from farms. Other important aspects are inflation and the rising cost inputs in crop management. The AIF started way back in 2020, so rising costs of steel, labour, cement, hiring labour and refrigeration equipment also need to be factored in for the fund amount today.These projects need big upfront capital which was difficult for FPOs and cooperatives to manage on their own. Even in the overall perspective, the state has a massive agri-infrastructure deficit to integrate the exercises of harvesting crop and storage.It also needs to be seen that these projects have long gestation periods for the project to settle down and give positive returns. Servicing of loans during this period becomes very difficult for the beneficiaries. The FPOs already have weak balance sheets in wake of poor credit histories.By way of figures, a 2020 study by Punjab Agricultural University shows that the state farmers suffered over Rs 2,000 crore post-harvest loss annually for wheat and rice crops alone occurring during harvesting, transportation and storage. Separate research studies also show losses in tomatoes (11.6 per cent), cauliflower (6.79 per cent), okra (5.57 per cent), peas (5.2 per cent) and potatoes (4.44 per cent).Small and marginal farmers feel that they cannot not associate with AIF. Even Farmer Welfare Societies at the block level feel they were excluded from AIF eligibility. This restricts the grassroots participation.Reliable sources say that Punjab has 128 Farmer Producer Organisations (FPOs) on record. However, only three are working. The state has approximately 3,500 Primary Agricultural Credit Societies (PACS) on record. Finance Minister Harpal Cheema has recently pointed out that approximately 50 per cent of these are in dire financial distress. At least 74, which were registered before 2019, had become non-functional due to managerial or economic issues.Punjab does not have a single integrated food park or a cluster hub for agri produce. At the same time, it is also worth mentioning that the Ministry of Agriculture and Farmers Welfare awarded Punjab as the best performing state for utilisation of the AIF fund in 2023-2024.
