Krishi Unnati Yojana – MOVCDNER

Krishi Unnati Yojana – MOVCDNER

Realizing the potential of organic farming in the country’s North Eastern Region, the Ministry of Agriculture and Farmer Welfare has launched a Central Sector Scheme titled “Mission Organic Value Chain Development for North Eastern Region” for implementation in the states of Arunachal Pradesh, Assam, Manipur, Meghalaya, Mizoram, Nagaland, Sikkim, and Tripura during the 12th plan period. The scheme aims to develop certified organic production in a value chain mode, connecting growers with consumers and supporting the development of the entire value chain, beginning with inputs, seeds, and certification and progressing to the establishment of facilities for collection, aggregation, processing, marketing, and brand building.

Mission Objectives

A. To build crop commodity-specific organic value chains and address gaps in organic crop cultivation, wild crop harvesting, organic animal management, and organic agricultural product processing, handling, and marketing through:

  1. Creating crop-specific organic production clusters with the required infrastructure, technology, and financial assistance.
  2. By encouraging connections between farmers and organic businesses: Local firms and/or Farmer Producer Companies that have established long-term trading relationships with clients in both domestic and export markets.
  3. By fostering an enabling environment for project initiatives and development programs, including support for organic value chain development and market access.

B. Empower producers with program ownership by organizing them into Farmer Interest Groups (FIGs), with the ultimate goal of federating into farmer-producer organizations/companies.

C. To transform the conventional farming/subsistence farming system into a locally based, self-sustaining, high-value commercial organic enterprise.

D. Creating a commodity-specific commercial organic value chain using an integrated and concentrated strategy, complete with facilities for production, processing, storage, and marketing.

E. Establishment of organic parks/zones with infrastructure for collection, aggregation, value addition, processing, storage, and market connections for specific commodities that require capital-intensive technologies.

F. Establish NER goods as brands/labels through brand development and improved marketing access in the ownership of growers’ organizations/companies.

G. Establishing a state-specific lead agency (Organic Commodity Board or Organic Mission) to coordinate, monitor, support, and fund the creation and implementation of the complete value chain.

Project Strategies

  1. To mobilize commodity clusters and assist capacity building, handholding, and infrastructure creation for on-farm input production, as well as training farmers on the package of practices and providing certification services.
  2. To assist the formation and integration of firms (local enterprises/farmer producer companies) capable of developing and operating collection, aggregation, and post-harvest processes, trading organic products, and providing farmers with necessary services, as well as working to expand their market.
  3. To establish lead agencies at the national and state levels to collaborate with value chain supporting agencies, service providers, and business development consultancies.
  4. To provide access to information, know-how, and capital, allowing businesses to offer effective services, assisting them in developing the necessary managerial capacities, and stimulating market growth.

Mission Implementation Structure

The scheme “Organic Value Chain Development for the North Eastern Region” will be carried out in a Mission manner. The Mission structure at the Government of India level will include the National Advisory Committee (NAC), Executive Committee (EC), Mission Monitoring Committee (MMC), and Mission Headquarters at DAC&FW.

At the state level, the mission will be administered by the State Level Executive Committee (SLEC) and carried out by a chosen state Lead Agency in the form of a “Organic Commodity Board” or “Organic Mission”. The State Lead Agency will be overseen by the Department of Agriculture/Horticulture, and it will be staffed by contracted professional specialists.

Krishi Unnati Yojana – MOVCDNER (2)

Benefits

Developing a crop-specific organic production cluster

  1. Cluster growth and the emergence of Farmer Producer Organizations/Companies : Crop/commodity-specific production clusters will be built in a concentrated manner to facilitate training, support, certification, and data collecting and aggregation. Farmers can be organized into Farmer Interest Groups (FIGs) at the village level and federated into organizations/companies at the district/state level using the Small Farmers Agribusiness Consortium (SFAC) recommendations for forming farmer Producer Companies. States can acquire the assistance of competent resource agencies, ideally those with experience in Farmer Producer Companies (FPCs), organic farming, value chain development, cluster development, and FPC creation.
  • In states where FPCs have already been established, further clusters should be built adjacent to the existing Krishi Unnati Yojana
    MOVCDNER clusters within the existing FPC. Efforts should be made to establish commodity-specific clusters, with at least 50-60% of the area cultivated with selected crops. New FPCs may be created only when clusters are established in previously undeveloped areas. Even current FPCs in the region may be asked to incorporate FIGs into the system. This will help you save money on the establishment of a new FPC.

2. Assistance with on-farm input production units and off-farm inputs Registered farmers of FIGs/FPCs will be aided in the development of on-farm input production infrastructure such as liquid manure tanks, NADEP compost tanks, botanical extracts, etc. The support would be given for a maximum of two hectares per beneficiary. A one-time assistance of Rs. 3750 per ha (up to a maximum of Rs. 7500/- for 2 ha per beneficiary) will be paid as a direct benefit transfer upon certification of the infrastructure developed. The funds for component A.1.2. are being provided over a three-year period, but they may be used in the first year if necessary, with prior notification to the government.

3. Off-farm inputs such as biofertilizers, bio-pesticides, neem cake, etc. Farmers registered under the initiative would receive a one-time aid of Rs. 3750 per hectare area in the first year to purchase bio fertilizers, bio insecticides, and neem cake, among other things. The maximum aid per beneficiary will be 2 hectares (up to Rs 7500 per beneficiary). Assistance will be provided as a direct benefit transfer upon verification of input purchases.

4. Assistance with quality seed and planting materials To assure quality and varietal uniformity, registered farmers will be given with high-quality seed and planting supplies. Assistance for quality seed/planting material would be limited to 50% of the real seed/planting material cost, which is Rs17500/ha (50% of the maximum of Rs 35,000/-). For efficient implementation, the Lead Agency can develop a complete production and supply plan that will provide farmers with a timely supply of seed/planting material. The funds for component A.1.3. are being provided over three years and may be used in the first year if necessary, with notification to the GoI.

Support for extension services, input facilitation, training handholding, and certification during the manufacturing stage.

  1. Assistance in establishing input delivery, distribution facilities, and agri-machinery bespoke hiring center To assist lead agencies in the establishment of input facilitation service centers and agri- machinery custom hiring centers at the commodity cluster / FPC level, a sum of Rs. 10.00 lakh/FPC has been provided for the establishment of need-based facilities based on the crop and activities being carried out.
  2. Training, handholding, ICS management, paperwork, and crop production certification through service providers A budget of Rs. 10,000 per hectare has been set aside for three years to hire competent service providers to provide handholding, ICS management, documentation, and organic certification through the PGS/third-party system under NPOP. To improve output and coordination, just one agency should be contracted for both FPC formation and assistance, as well as ICS management, documentation and certification. Service providers must ensure that ICS staff are employed from among the participating farmers so that the activity can continue even after the agency departs.

Eligibility

Value Chain Post Harvest

  1. Financial assistance will be provided for the establishment of functional infrastructure for collection units, grading units, and the North East Organic Bazaar (NE Organic Bazaar). State lead agencies will assist FPCs in developing functional infrastructure for collection and grading units under their ownership through technical consultancies and hired experts.
  2. Financial assistance for the establishment of functional infrastructure for collection units, grading units, and the North East Organic Bazaar. State lead agencies will assist FPCs in developing functional infrastructure for collection and grading units under their ownership through technical consultancies and hired experts. The NE Organic Bazaar will be built, maintained, and controlled by FPCs/FIGs/FPOs registered with MOVCDNER, which will serve as collection points between the farm gate and processing infrastructure. The beneficiary FPCs/FIGs/FPOs must meet specific criteria to become eligible for financial assistance under the Mission, which are as follows:
  • FPCs/FIGs/FPOs have a minimum contiguous area of organic production or conversion of 400 ha.
  • The marketing infrastructure must be located within a 25-kilometer radius of the clusters built and registered under MOVCDNER.

Financial support is limited to 75% of the total financial outlay (TFO) or the maximum budget allocation (Rs. 11.25 lakh per unit), whichever is less.

Value Chain Processing

  1. Financial aid for establishing integrated processing units The establishment of an integrated processing unit is linked to an area that has already been certified as organic or is proposed for conversion to organic. It is critical to ensure that appropriate raw material is accessible from local grower organizations. It is also necessary to guarantee that facilities are designed such that diverse commodities can be processed under one roof and that the unit can operate for at least 8-10 months of the year. Subsidy should be on a pro-rata basis, which is defined as the proportionate distribution of money based on the promoter’s commitment. These ventures should preferably be driven by entrepreneurs, with support provided in the form of credit-linked subsidies. FPCs/FPOs/FIGs registered under the appropriate laws and with at least 250-500 members will also be eligible for support. FPCs/FPOs/FIGs can receive subsidies without a credit link if they can meet their portion of the project cost and complete all setting up transactions through banks. Assistance to FPCs/FPOs/FIGs shall be limited to 75% of TFO, or Rs 600 lakh, whichever is less. As a credit-linked subsidy, private entrepreneurs will receive 50% of TFO or up to Rs. 600 lakh, whichever is less. Before authorizing such units, states must confirm that the unit’s feasibility and economic viability, as well as the technology used, meet proper market standards. * The Project Management Unit will assist the state lead agencies in identifying technologies and technology-providing agencies/institutions.
  2. Integrated Pack House The scheme calls for the establishment of an integrated pack house as a subset of collection, aggregating, and grading units and integrated processing units. When developing the type of pack house, it must guarantee that it satisfies the needs of the commodities being targeted, is accessible to the handling and processing unit, and has market links. This component should also be considered as entrepreneur-driven. FPCs/FPOs/FIGs will also be eligible to get support. They may receive a subsidy without a credit link, provided that they can meet their share of the project costs. Assistance to FPCs/FPOs/FIG is limited to 75% of TFO or Rs 37.50 lakh, whichever is less. Assistance to private enterprises will be 50% of TFO or a maximum of Rs 37.50 lakh, whichever is less as a credit-linked subsidy.
  3. Transportation/four-wheeler up to TFO of 12 lakhs (50%) Refrigerated transport vehicles, as well as pre-cooling/cold stores/ripening chambers, are examples of cold chain infrastructure that should be created as part of an integrated pack house. State lead agency must assess the need based on the commodities and quantities being targeted. Cold storage projects will be approved in accordance with existing specifications, standards, and protocols for cold storage and cold-chain components. The National Centre for Cold-chain Development (NCCD) will update technical standards and adherence processes as needed as new technologies and efficiencies are introduced, understood, and authorized.
  4. Cold chain component Assistance for Refrigerated transport vehicles, as well as pre-cooling/cold stores/ripening chambers, shall be subject to the conditions outlined in 1 above and Cold chain component B.3.3 above. Assistance to FPCs/FPOs/FIGs shall be limited to 75% of TFO or Rs. 18.75 lakh, whichever is less, for both refrigerated vehicles and cold storage, respectively. As a credit-linked subsidy, private enterprises will receive 50% of TFO or a maximum of Rs. 18.75 lakh for each component, whichever is less.

Application Process

Offline

Subsidy Application Procedure

The State Lead Agency (SLA) would be in charge of selecting qualified participants and beneficiaries for the initiative. The beneficiary selection mechanism employed by the SLA must be transparent. A proposed unit that has already received a subsidy from another State or Central Government Department/Agency would be ineligible for this plan.

The qualified beneficiaries under Krishi Unnati Yojana 
MOVCDNER will complete the subsidy proposal in the approved format and submit it to the State Lead Agency (SLA) designated for each state.

The method for sanctioning and disbursing subsidies Once the beneficiary identification and selection process is done, SLA will transmit the subsidy proposal to NEDFi for processing. NEDFi will analyze the subsidy proposal based on the criteria established by Krishi Unnati Yojana
MOVCDNER and notify to the Commercial Bank/ Financial Institution where the eligible beneficiary has applied for a term loan component.

After the Commercial Bank/ Financial Institution approves the term loan for the proposed unit, the loan and subsidy proposal will be presented to the Subsidy Sanctioning Committee for final approval of the subsidy component. The Subsidy Sanctioning Committee is made up of NEDFi, IIFPT, and SLA representatives from each state.

The Subsidy Sanctioning Committee will conduct a combined pre-sanction site visit. Based on an assessment of the project’s physical progress/status, the subsidy amount will be sanctioned and released pro-rata based on the use of beneficiary contributions. The subsidy is expected to be disbursed in three (3) installments. Aside from the pre-sanction site inspection for a subsidy, NEDFi and other members of the Subsidy Sanctioning Committee will make mandatory visits to the project sites before the payout of each subsidy installment, or as needed.

NEDFi will pay for equipment and machinery and other significant vendors directly, subject to the maximum amounts sanctioned against each particular unit to cover such expenditures.

Documents Required

Check the list of documents to be supplied together with the subsidy claim:

  • Document Number A-1
  1. I am forwarding the beneficiary’s letter.The beneficiary’s complete address, including phone/fax numbers and email.
  • Document Number A-2
  1. The promoter submitted a copy of the project report (DPR) with itemized data of costs, total expenditure, financing, and margins.
  • Document Number: A-3
  1. Copy of the approved plan/map and civil drawings that clearly show the dimensions and capacity of the infrastructure project.
  • Document Number: A-4
  1. Invoices for machinery/equipment purchases (where applicable).
  • Document Number: A-5
  1. Copy of land documents where the project would be established.
  • Document Number: A-6
  1. Notarized Affidavit in Original executed by the promoter on non-judicial stamp paper as recommended by the State Lead Agency (SLA).
  • Document Number: A-7
  1. Copy of a fully registered partnership deed, if it is a partnership firm; Memorandum and Articles of Association; and certificate of incorporation, if it is a private limited company, etc.In the case of an FPC, a registration certificate as per the Producer Company under Section 581(C) of the Indian Companies Act, 1956, as amended in 2013. In the case of FPO, refer to the appropriate state’s Cooperative Societies Act/Autonomous or Mutually Aided Cooperative Societies Act.
  2. Figure: SLA recommendation.