NewDelhi : The Cabinet Committee on Economic Affairs chaired by the Prime Minister, Shri Narendra Modi today has approved an initial Corpus of Rs.5,000 crore for setting up of a dedicated “Micro Irrigation Fund” (MIF) with NABARD under Pradhan MantriKrishiSinchayeeYojana (PMKSY).
The allocation of Rs. 2,000 crore and Rs. 3,000 crore will be utilised during 2018-19 and 2019-20 respectively. NABARD will extend the loan to State Governments during this period. Borrowings from NABARD shall be paid back in 7 years including the grace period of two years. The lending rate under MIF has been proposed at 3% lower than the cost of raising the fund by NABARD. This cost shall be met from the ongoing scheme of PMKSY-PDMC by amending the existing guidelines.The total financial implication on interest subvention comes to about Rs 750 crore.
The dedicated Micro Irrigation Fund would supplement the efforts of Per Drop More Crop Component (PDMC) of Pradhan MantriKrishiSinchayeeYojana in an effective and timely manner.With the additional investment for micro irrigation accessing MIF, innovative composite/ commodity/ community/ cluster based micro irrigation projects/ proposals may bringabout 10 lakh ha.The Fund will facilitate States to mobilise resources for theirinitiatives, including additional (top up subsidy) in implementation of PMKSY-PDMC toachieve the annual target of about 2 Million ha/year during the remaining period of 14thFinance Commission under Per Drop More Crop Component of PMKSY as recommended by the Group of Secretaries.