Centre Plans Trillion-Rupee Boost For Farm Infrastructure To Reduce Crop Loss

The Centre is set to unveil a landmark initiative in the Union Budget 2026, with plans to inject over ₹1 trillion into farm infrastructure. This expansion of the Agriculture Infrastructure Fund (AIF) is designed to tackle crop losses, particularly for perishable produce, by improving storage, processing, and logistics facilities across rural India.  

Key highlights from the announcement include  

• The Agriculture Infrastructure Fund, launched in 2020 as part of a ₹20 trillion pandemic stimulus, currently has a loan support ceiling of ₹1 trillion.  
• The new allocation will extend support over the next five years, focusing on post-harvest infrastructure such as cold storage, warehouses, and food processing units.  
• Farmers and agri-entrepreneurs will benefit from loans with a 3% interest subvention and credit guarantee cover up to ₹2 crore for seven years.  
• Beneficiaries are required to contribute at least 10% of project costs, ensuring shared responsibility and sustainability.  
• Since its inception, the AIF has already sanctioned over ₹1.18 trillion across more than 146,000 projects nationwide.  
• The government’s push is expected to reduce crop wastage, improve price realization for farmers, and strengthen India’s food supply chain resilience.  
• Analysts note that the initiative aligns with broader rural development goals, including doubling farmer incomes and promoting sustainable agriculture.  
• Equitable distribution of funds across states will be critical to ensure balanced growth and minimize regional disparities.  

This trillion-rupee boost reflects the Centre’s recognition of agriculture as a cornerstone of India’s economy, contributing nearly 16% to GDP and supporting over 46% of the population. By focusing on infrastructure, the government aims to address systemic inefficiencies that have long plagued farmers, while ensuring food security in the face of climate and market challenges.  

Sources: NewsBytes, Mint, Business Standard, EY Union Budget Alert