ANNOUNCEMENT 28 Feb 2018
The Government has increased the guarantee provided to banks for them to extend credit to a government procurement agency for the latter's procurement operations of pulses and oilseeds.
NUMBER OF INTERVENTIONS
Official release - Press Information Bureau
On 28 February 2018, the Indian Cabinet Committee on Economic Affairs doubled the guarantee provided to banks for providing credit to the National Agricultural Cooperative Marketing Federation of India (NAFED). The guarantee has been increased from INR 9,500 crore (~USD 1456 million) to INR 19,000 crore (~USD 2913 million)* and is provided for 5 years i.e. 2017-2018 to 2021-2022 with an exemption of a government fee of 1%.
The NAFED uses these loans for the procurement operations of pulses, oilseeds, and cotton under the Price Support Scheme (PSS). The PSS provides an opportunity for farmers to sell their produce to the government at the Minimum Support Prices (MSP), in case the prices fall below the declared MSP.
The pulses covered under the MSP are Moongs, Urad and Tur (Arhar) and the oilseeds covered are Groundnut, Sunflower, Soyabean, Sesamum and Nigerseed.
* INR to USD conversion as on 28 February 2018 - INR 65.22/USD