The proposal on Cooperative Initiative for Agriculture Infrastructure in Kerala (CAIK) in the revised Budget for 2021-22, which aims to speed up capital formation in the farm sector to build infrastructure like chain of cold storages, processing and value addition facilities, improve marketing set-up and adopt hygienic markets for fish and meat, among others, is expected to bring big changes to agriculture in the State.
The government proposal comes in the wake of the disruption in normal business activities in the COVID-19 scenario. There has been a breakdown in the supply chain and movement of products. The government has been planning to do something about these types of situations in the post-COVID-19 scenario and the proposal to help infuse more capital into the agricultural infrastructure is part of these steps, said sources in Kerala Agricultural University.
C.P. John, former member of the Planning Board and Communist Marxist Party leader, welcomed the proposal and called it a sensible one that can help build infrastructure in the agricultural sector. The produce in the State may not all be sold as fresh items, processing is the key whether they are roots or fruits. Processing and value addition would be able to give the necessary support to the farmers.
In this regard, he said that a policy change can help the State to turn a part of the fruit production into wine. While there was a taboo on alcohol and distilling, the State could think of fermentation. He also suggested ethanol production and changes in the State policy on these issues.
Sources in the dairy sector said that the cooperative sector had succeeded to a large extent in building infrastructure like milk chillers. There are 160 coolers with capacity ranging between 1,000 litres and 2,000 litres in Thrissur, Ernakulam, Kottayam, and Idukki. Such facilities existed in other districts too. The chain of chillers ensured that procured milk was not spoiled. But processing for value addition remained a lacuna in the sector, sources said, expressing confidence that the new initiative would address the issue also.
The budget proposals pointed to improving investment credit to boost private capital formation and create local markets, warehouses, cold chain facilities and fruit processing centres for pineapple, banana and mango. Processing centres for products such as vegetables, milk, meat and fish and marketing can be established. These facilities can be built with the proposed Infrastructure Rejuvenation Loan Scheme from NABARD for primary cooperative societies at the rate of 4% interest, with 3% interest subvention.
Sources in Kerala Bank, which will lead the initiatives for providing loans to the primary cooperatives, said that the loans would also be available to private individuals and corporates with 3% interest subvention facility. The Budget proposal said that the objective was to provide loans amounting to Rs. 2,000 crore under the programme in the current financial year.
