agri and food processing nabard kerala गाँव बढ़े तो देश बढ़े ...

AGRI AND FOOD PROCESSING NABARD Kerala www.nabard.org /nabardonline Taking Rural India >> Forward

2 Food Processing Sector is the 5 th largest Manufacturing Industry Contributes 9% to the manufacturing sector Contributes 1.5% to GDP Indian Food Processing Industry (2012) - Rs. 8 lakh crore Estimate by 2015 : Rs. 12 lakh crore Important Segments Indian Food Processing Industry & Potential Meat, Fish, Fruits, Vegetables & Oils40% Dairy Products5% Grain Mill Products10% Beverages20% Other Food Products25%

3 www.nabard.org /nabardonline Taking Rural India >> Forward Advantage India FRUITS & VEGETABLES MILK & MILK PRODUCTS MARINE PRODUCTS MEAT & POULTRY GRAIN PROCESSING CONSUMER FOOD India is the worlds 2nd largest producer of fruits and vegetables; production to rise from 227MT currently to 377MT by 2021 With 133 MT (P) in FY13, India is the largest producer of milk in the world India is the largest producer of buffalo meat (1.5 MT*) and the second largest producer of goat meat (0.6 MT*) With 9.1 MT production in FY13, India is the second largest producer of fish in the world India produced about 259 MT of food grains in FY13 Among the fastest growing segments in India and includes (i) Packaged Foods (ii) Aerated Soft Drinks (iii) Packaged Drinking Water and (iv) Alcoholic Beverages

4 www.nabard.org /nabardonline Taking Rural India >> Forward Indian Food Processing Industry Unorganised Sector42% Small scale Industries33% Organised Sector25% Unorganised sector (includes SSI) contributes 75% by volume and 50% by value. Inputs Value Chain in Food Processing Production Procurement & Storage Processing Retailing Seeds, Fertilizers, Farm Equipment Farmers, Cooperatives, Companies Warehouses, Cold Storages Primary (cleaning, grading, packing, etc.) Secondary (product conversion) Malls Retail shops Cash & Carry

5 www.nabard.org /nabardonline Taking Rural India >> Forward Spices Marine Products Cashews Coconuts Cocoa, Coffee and Tea Fruits like banana and pineapple Major Food Processed in Kerala

6 www.nabard.org /nabardonline Taking Rural India >> Forward Coconut Park Rice park Activated carbon plant Modern Cold Storage Coconut based food processing plant Modern rice mill Individual Quick Freezing (IQF) facility Meat processing unit Medicinal plants preservation and processing centre Coconut oil mill and refinery Mango processing Marine food park Ready to Eat (RTE) products Bioethanol from Cashew Apple Food processing potential identified - Kerala

7 www.nabard.org /nabardonline Taking Rural India >> Forward Refinance Rural Infrastructure Development Fund Umbrella Programme on Natural Resource Management NABARD Infrastructure Development Assistance Warehouse Infrastructure Fund Producer Organisation Development Fund Off Farm Sector Development Food Processing Fund NABARD Support to Processing Sector

FOOD PROCESSING FUND 2014-15 www.nabard.org /nabardonline Taking Rural India >> Forward

9 Corpus contributed by Scheduled Commercial Banks NABARD to finance directly or through consortium financing. Lending rate and margin on loans to State Governments and Government entities on par with RIDF lending Loans to private sector at rates not below PLR of NABARD Operationalization of Fund

10 www.nabard.org /nabardonline Taking Rural India >> Forward State Governments Entities promoted by State Governments (with or without Government Guarantee) Entities promoted by Government of India, Joint Ventures, SPVs, Cooperatives, Federations of Cooperatives, Farmers Producer Organizations (FPOs), corporates, companies, entrepreneurs, etc. Eligible Institutions / Entities

11 www.nabard.org /nabardonline Taking Rural India >> Forward Food Parks promoted by MoFPI Mega Food Parks promoted by MoFPI Food Parks/food processing industrial estates promoted by States Food processing/ agro processing/ multi products SEZs and de-notified areas of these SEZs Any area having infrastructure and designated as Food Park by MoFPI Designated Food Parks (DFPs)

12 www.nabard.org /nabardonline Taking Rural India >> Forward Creation of infrastructure required in the DFPs Augmentation of existing infrastructure in the DFPs New processing units in DFPs Modernization of existing processing units in the DFPs Eligible Projects

13 www.nabard.org /nabardonline Taking Rural India >> Forward Activities resulting in value addition and/or enhanced storage life Units requiring product processing (primary/secondary) All types of products as per MoFPI guidelines (horticulture, milk, meat, fish, cereals, oilseeds, confectionery, convenience foods, ready-to-eat foods, nutraceuticals, health foods, etc.) Eligible Processing Activities / Units

14 www.nabard.org /nabardonline Taking Rural India >> Forward Land (up to a max. of 10% of land cost reckoned towards project outlay) Site development All civil works, covering core and non-core buildings, internal roads, fencing / boundary wall, etc. Plant and machinery, equipment and other fixed assets Miscellaneous fixed assets Technology transfer fee and other consultancy charges Preliminary and pre-operative expenses Capitalized working capital for one operating cycle, etc. Eligible Project Components

15 www.nabard.org /nabardonline Taking Rural India >> Forward Lending Terms Sl. No Borrowing entityMax. loan (% of TFO) Rate of interest (% p.a) Security (i) State Governments 95%As applicable for RIDF (Bank Rate less 1.50%) State Government Undertaking (ii) Entities promoted by State Govts. (with Govt. Guarantee) 95% As applicable for RIDF (Bank Rate less 1.50%) Primary security, Govt. guarantee and collateral security as acceptable to NABARD

Entities promoted by Government of India, Joint ventures, SPVs, Cooperatives, Federations of Cooperatives, FPOs, corporates, companies, entrepreneurs, etc. ** Prime Lending Rate 16 www.nabard.org /nabardonline Taking Rural India >> Forward Lending Terms Sl. No Borrowing entityMax. loan Tenure of loan RoI (% p.a) Security (iii)Entities promoted by State Govts. (without Govt. guarantee) 95%Up to 7 years PLR** + Risk Premium Primary security and collateral security as acceptable to NABARD (iv)Private Sector *75% Up to 7 years PLR** + Risk Premium Primary security and collateral security as acceptable to NABARD

17 www.nabard.org /nabardonline Taking Rural India >> Forward Linked to PLR of NABARD and Risk Rating of Borrower PLR of NABARD to be worked out by ALCO quarterly Risk Rating of the Borrower Risk premium to be based on Risk Rating Lending Rate to Private Sector

18 www.nabard.org /nabardonline Taking Rural India >> Forward Repayment Borrowing entityTotal repayment period Grace periodNature of installments Remarks State Governments 7 years2 (fixed)AnnualEach installment of release is a separate loan and has separate repayment schedule State Agencies (with Govt. Guarantee) 7 years2 (fixed)Quarterly / Half- yearly / Annual (as per cash flows) PLR-basedUp to 7 years Up to 2 years (based on cash flows) Quarterly / Half- yearly / Annual (as per cash flows) @ In all cases, interest shall be paid at quarterly intervals, including the moratorium period.

19 www.nabard.org /nabardonline Taking Rural India >> Forward Evaluation Fee No fees for RIDF-based lending Fees @ 0.25% of Project Cost, subject to a min. of Rs. 2 lakh and a max. of Rs. 30 lakh for PLR-based lending Annual Monitoring Fee No fees for RIDF-based lending Expenses on undertaking technical, financial and legal inspections undertaken during the currency of the loan, either by NABARD or through a LIE / LLC appointed for the specific purpose, shall be reimbursed by the borrowing entity to NABARD. Other Aspects

THANK YOU Picture 3 www.nabard.org /nabardonline Taking Rural India >> Forward

UPNRM 3 www.nabard.org /nabardonline Taking Rural India >> Forward

22 www.nabard.org /nabardonline Taking Rural India >> Forward A) Core Activities Soil and water conservation Plantation and horticulture (tree based farming, Bamboo based farming, wadi development,organic farming, energy plantations) Forestry activities (rehabilitation and management /Community Forest management, biodiversity conservation) Farming systems management (including livestock and aquaculture resources) Climate change adaptation / CDM Other Aspects

23 www.nabard.org /nabardonline Taking Rural India >> Forward b) Supplementary / support areas forward and backward linkages and livelihood generating activities; processing, storage, marketing, supply chain critical rural infrastructure (including rural roads, minor irrigation, drinking water) renewable energy (micro/mini-hydel, biomass based power generation, biofuels, wind-power, solar power) livelihood generating activities (dairy, poultry, fisheries, etc) c) Information & Knowledge Management (IKM) and Capacity Building Sectors Covered

24 www.nabard.org /nabardonline Taking Rural India >> Forward Pro-poor (improves employment, reduces poverty, improves access to credit, information, entitlements) Ensuring sustainability (conserves / augments NRM base of the region, prevents degradation) Good Governance (Equity in ownership and access and use of resources, decentralized decision making, accountability and transparency) Community participation (ownership / management/ empowerment) Integrated approach (need-based and flexible, convergence with other schemes / programmes) UPNRM Guiding Principles

25 www.nabard.org /nabardonline Taking Rural India >> Forward Rate of interest on UPNRM loans Type of funding Channel Partner Type of ProjectsRate of interest Project finance/ bulk finance NGOs, Cooperatives, MFIs Corporates Projects implemented thru CBOs (where loan is passed on to rural people directly or through POs); 9% 10 -12 % Projects implemented directly (without on- lending to people) 9-10% State Govt8.5%

26 www.nabard.org /nabardonline Taking Rural India >> Forward Investment loan various NRM measures, associated livelihood activities, related infrastructure and marketing chain management, etc Working Capital / Revolving Assistance Value addition and supply chain management Production of raw material, Procurement and stocking of produce, Processing and packing, Marketing inventories, distribution, etc Grant support Proposal development Capacity building Community mobilisation Cost of expertise UPNRM Special Features contd

FINANCING COLD CHAIN INFRASTRUCTURE UNDER WAREHOUSE INFRASTRUCTURE FUND 3 www.nabard.org /nabardonline Taking Rural India >> Forward

Eligible Projects 28 www.nabard.org /nabardonline Taking Rural India >> Forward Cold chain for Horticulture Products Pack houses / Integrated Pack houses (washing, grading, waxing, packing, etc.) Pre-cooling Units (with / without staging cold rooms) Standalone cold storages / CA Storages / MA Storages Refrigerated vehicles (reefer vans/ reefer trucks) Freezing / Individual Quick Freezing Units Integrated Cold Chain Projects

Eligible Items of Project Cost (indicative) 29 www.nabard.org /nabardonline Taking Rural India >> Forward Land (up to a max. of 10%) Civil works (core and ancillary) Plant and Machinery Equipment and Miscellaneous Fixed Assets Technical consultancy charges Preliminary and pre-operative charges Interest during construction Cost contingencies Capitalized working capital for one operating cycle

Sectors prioritized by GoI. Loans to Public and Private Sector. Private Sector* includes all agencies without Govt. guarantee. Loans to State Govts. & Govt undertakings with State Government guarantee on RIDF terms. Loans to Private Sector PLR based interest rate. Sectors eligible 30 www.nabard.org /nabardonline Taking Rural India >> Forward [email protected] [email protected] /[email protected] * - Central Government /State Government undertakings (without guarantee), Joint ventures, SPVs, Federations of Cooperatives, FPOs, Corporates, Companies, Entrepreneurs etc.,

WIF 2014 -15- Financing terms and conditions 31 www.nabard.org /nabardonline Taking Rural India >> Forward 13 Oct 2014 [email protected] Type of Borrower Maximum Quantum of Loan (% of TFO) Tenor of loan (Years) Rate of Interest (% p.a.) Security/ Documentation A Loans with RIDF rate of interest 1 State Governments (loans to Finance dept. under article 293(3) ) 9507 Prevailing RIDF rate of interest Government undertaking. 2State Owned Corporations (loans outside article 293(3) 9507Prevailing RIDF rate of interest Government Guarantee + Primary & Collateral Security, etc.

WIF 2014 -15- Financing terms and conditions 32 www.nabard.org /nabardonline Taking Rural India >> Forward [email protected] Type of Borrower Max. Quan. of Loan (% of TFO) Tenor of loan (Years) Rate of Interest (% p.a.) Security/ Documentation BLoans with interest rates based on Prime Lending Rate ( PLR) 1 State/Central Govt. Owned/Assisted Entities (without Government guarantee)/ Cooperatives, FPOs, SPVs set up under PPP mode, etc., 9507PLR*+ RP* Primary & Collateral Security, Assignment of rentals receivable and any other unencumbered receivables, Debt Service Reserve etc. 7 years PLR+ RP+TP* 2 Private Companies/ Corporates/ Individual Entrepreneurs etc. 7507PLR*+ RP* Primary & Collateral Security, Assignment of rentals receivable and any other unencumbered receivables, Debt Service Reserve etc. > 7 yearsPLR+ RP+TP* ABOVE SEVEN YEARS APPLICABLE ONLY FOR WIF LOANS *- PLR Prime Lending Rate, RP Risk Premium, TP Tenor Premium.

Producers Organisation 3 www.nabard.org /nabardonline Taking Rural India >> Forward

Presentation6.pptx 34 DEFINITION OF PRODUCER ORGANIZATIONS Formed and owned by a group of producers for either farm or non-farm activities It is a registered body and a legal entity Producers are shareholders in the organization It deals with business activities related to the primary produce/product. It works for the benefit of the member producers Portions of profit are shared amongst the producers and the balance goes to the share capital or reserves Taking Rural India >> Forward

What POs can offer End to end solutions !! Supply of seeds, fertilizers, pesticides, agri implements, etc Input Supply Services Provides/facilitates for loan for crops, purchase of agri implements, etc Financial Services Promote best farming practices, marketing information System, skill upgradation, etc. Technical Services

Taking Rural India >> Forward What POs can offer End to end solutions !! Various insurance like Crop Insurance, Life insurance, etc Insurance Services Procurement, storage, marketing, value addition and packaging Procurement & Packaging Services Direct marketing to reduce income leakages Marketing Services Making channels for information (product specification, market prices, etc Networking Services

Presentation6.pptx 37 NABARD COMPREHENSIVE SUPPORT PROGRAMME A.Credit support I.In the form of loan to POs i.Term loan ii.Working Capital Term Loan iii.Composite Loan (term loan + working capital) II. Assistance to Implementing Agency for on lending to PO Credit Support to implementing agencies like NGOs, Vas, Trusts (instrumental in forming SHGs, Farmer federations, clusters, other cooperatives/POs) and financial institutions including, subsidiaries like ABFL, ADFT and NABFINS participating in value chain process, for on-lending to POs, farmers/artisans groups or clusters such as SHGs, JLG, federations and farmers clubs. B. Credit plus support in the form of grant, subject to a cap of maximum 20% of loan amount I.Capacity Building: Includes Human resource development and organizational development. II. Market Linkages III.Others (DPR preparation, administrative expenses etc) Taking Rural India >> Forward

Presentation6.pptx 38 NABARD COMPREHENSIVE SUPPORT PROGRAMME III. Lending to Producer Organisations for Contribution to Share Capital Model I: Lending to Producer Organisations for Contribution to Share Capital Model II: Lending to the promoting agency which in turn can lend to the members of the PO Features: Capital: loan would be at 1:1 basis. Cap on loan amount would be Rs. 25 lakh. Further cap of Rs. 25000/- per member Repayment 5-7 years with 1-2 years moratorium period. ` Taking Rural India >> Forward

Presentation6.pptx 39 DETAILS OF FINANCIAL ASSISTANCE Quantum Limited to 90% of total financial outlay Mode Loan for taking up of economic activity along with grant or loan or a blend of both for capacity building RoI -As decided by ALCO Present range: 10.25-12% based on collaterals provided 10.25 % in case of 100% collateral Taking Rural India >> Forward

Presentation6.pptx 40 ELIGIBLE INSTITUTIONS PARTNERSHIP WITH CORPORATES, LINE DEPARTMENTS, NGOS, CBO Support to Supply Chain from Primary producer to retailer/ultimate consumer Support to value addition Encourage feeder/suppliers to retailer chains like Big Bazar to form/promote POs avail assistance under PODF. Subsidiaries/Ancilliaries of larger entities/corporate business houses can promote POs and avail assistance under PODF Taking Rural India >> Forward

agri and food processing nabard kerala गाँव बढ़े तो देश बढ़े ...

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