‘Rs.7,000-crore investment proposals in Million Farmers initiative’

A total of 35 proposals, with an investment of Rs.7,000 crore, were received from various companies for the “Million Farmers” initiative in public private partnership, a Federation of Indian Chambers of Commerce and Industry (FICCI) official said Thursday.

The proposals will cover 11.8 lakh farmers on a total crop area of 12 lakh hectares in 17 states. According to FICCI, the project is almost in the stage of approval by the agriculture ministry.

The pilot projects envisage minimum investment of Rs.1 lakh in each farm with the ministry bearing 50 percent of the total cost and the remaining 50 percent coming from private developers through own or institutional finance.

Eight of the proposals were submitted by ITC and they include a Rs.1,368 crore proposal for cereals, pulse, oilseeds in the states of Madhya Pradesh, Uttar Pradesh, Maharashtra and Rajasthan covering over one lakh farmers.

B. Baskar Reddy, head, agriculture, FICCI, told a meeting on agri business here that four to five pilot projects would be launched during the coming kharif season while the full-fledged scheme will become operational during kharif 2013-14.

For the 35 proposals received, the subsidy component would be Rs.2,900 crore while common infrastructure would be created at a cost of Rs.1,000 crore.

“We are in the stage of approving business plans and will leverage funds from state governments,” he said.

Reddy said the states were evaluating the PPP model, and the agriculture ministry is likely to issue detailed guidelines for PPP-integrated agriculture development by the end of the current month.

The PPP model would combine operational efficiencies of the private sector and the investment by the public sector, he said, adding that each project covering at least 10,000 farmers will set quantifiable outputs with defined timelines and strategies.

The companies, which will work as facilitator, will develop farmer producers organisations, provide extension, supply inputs, manage infrastructure and buy back the products while the government will extend support, channelise funds from various schemes, provide operational freedom to private sector, do the monitoring and evaluation and invest in infrastructure.

The companies will be provided performance-based incentives. “Every developer will define outputs for three years. There will be third-party independent monitoring,” Reddy said.