Topic of the Day – Micro-Irrigation Fund

UPSC Exam Preparation: Topic of the Day – Micro-Irrigation Fund

Approval has been given by the Cabinet Committee on Economic Affairs (CCEA) chaired by Prime Minister for setting up of a dedicated ‘Micro Irrigation Fund’ (MIF) with NABARD under Pradhan Mantri Krishi Sinchayee Yojana (PMKSY) with an initial corpus of Rs 5,000 crore. For the current fiscal year (2018-19), an allocation of Rs 2,000 crore has been made while  Rs 3,000 crore has been earmarked for the next fiscal year (2019-20). The fund has been set up under NABARD, which will provide this amount to states on concessional rate of interest in order to promote micro-irrigation. The dedicated Micro Irrigation Fund is being set up in order to achieve the goal of ‘per drop more crop’.
 
Details

  • By supplementing the efforts of PMKSY programme, the dedicated micro irrigation fund would help in bringing about 10 lakh hectares under micro-irrigation.
  • The fund will facilitate States to mobilize resources for their initiatives, including additional (top up subsidy) in the implementation of Pradhan Mantri Krishi Sinchayee Yojana – Per Drop More Crop (PDMC) to achieve the annual target of about 2 million hectares per year during the remaining period of 14th Finance Commission.
  • The government estimates the area that can come under micro irrigation at 69.5 million hectares, compared with the current coverage of only about 10 million hectares. 
  • The states can access this fund for incentivizing micro-irrigation, innovative integrated projects, including projects in the Public Private Partnership (PPP) mode.
  • The funds can be accessed by State Level Agencies/ Farmers Producers Organization (FPO)/ Cooperatives with state government guarantee or any equivalent collateral.
  • The fund may be accessed by the Farmers Co-operatives for innovative cluster based community irrigation projects.
  • Under the programme, NABARD will extend loans to state governments during this period. The loans can be paid back in 7 years, including a grace period of two years. 

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