Cabinet approves initial corpus of Rs. 5000 crore for Micro Irrigation Fund with NABARD

The Cabinet Committee on Economic Affairs (CCEA) yesterday approved an initial corpus of Rs. 5,000 crore for setting up of a dedicated Micro Irrigation Fund (MIF) with NABARD under the Pradhan Mantri Krishi Sinchayee Yojana (PMKSY). 
An official press release said the allocation of Rs. 2,000 crore and Rs. 3,000 crore would be utilised during 2018-19 and 2019-20, respectively. 
NABARD will extend the loan to State Governments during this period.  Borrowings from NABARD shall be paid back in seven years including the grace period of two years.
The lending rate under MIF has been proposed at 3% lower than the cost of raising the fund by NABARD.
This cost shall be met from the ongoing scheme of PMKSY-PDMC by amending the existing guidelines. The total financial implication on interest subvention comes to about Rs 750 crore, the release said.
The MIF would supplement the efforts of Per Drop More Crop Component (PDMC) of PMKSY in an effective and timely manner, the release added.
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