India Expands World’s Largest Grain Storage Plan in Cooperative Sector

Syllabus: GS3/ Agriculture

In Context

• Under the pilot phase of the ambitious World’s Largest Grain Storage Plan in the cooperative sector, godowns have been successfully constructed at Primary Agricultural Credit Societies (PACS) in 11 states across India.
  • PACS are village level cooperative credit societies that serve as the last link in a three-tier cooperative credit structure headed by the State Cooperative Banks (SCB) at the state level.

Core Elements of the Plan

• Decentralization: Shifting the focus of grain storage from large central warehouses to smaller, localized units at the PACS level. This has multiple advantages:
  • Reduced Transport Costs: Farmers can store their produce closer to their farms, minimizing transportation expenses.
  • Reduced Post-harvest Losses: Faster storage after harvest reduces spoilage and wastage.
  • Increased Accessibility: Farmers, especially in remote areas, have easier access to storage facilities.
  • Empowering PACS: The plan aims to revitalize PACS by diversifying their role beyond credit disbursement. This can make them more financially sustainable and enhance their contribution to rural development.
  • Convergence of Schemes: The plan smartly utilizes existing government schemes like AIF and AMI to provide financial support to PACS, ensuring efficient utilization of resources.
• Multi-faceted Infrastructure: Besides godowns, the plan encourages PACS to establish other agricultural infrastructure like warehouses, processing units, and custom hiring centers. This integrated approach can create a more robust and efficient agricultural ecosystem.
• Financial Support: The initiative integrates subsidies and interest subventions through various government schemes, such as the Agriculture Infrastructure Fund (AIF) and the Agricultural Marketing Infrastructure Scheme (AMI).
  • Under the AIF scheme, PACS receive a 3% interest subvention on loans up to ₹2 crore, with a repayment tenure of seven years (2+5 years). The AMI scheme provides a 33.33% subsidy to PACS for constructing storage units
• Key Supporting Agencies: National Cooperative Development Corporation (NCDC), National Bank for Agriculture and Rural Development (NABARD), NABARD Consultancy Services (NABCONS).

Other initiatives to enhance grain storage infrastructure

• Gramin Bhandaran Yojana (Rural Godown Scheme): This scheme offers subsidies to individuals and organizations for constructing or renovating rural godowns, thereby increasing storage capacity at the farm level. 
• Central Warehousing Corporation (CWC): Established in 1957, the CWC operates over 400 warehouses across India, providing scientific storage and handling services for various commodities, including agricultural produce. 
• National Centre for Cold-chain Development (NCCD): NCCD focuses on developing cold-chain infrastructure to minimize post-harvest losses of perishable commodities.

Source: DD News