Animal Husbandry Infrastructure Development Fund (AHIDF)

Overview

The government has been executing various schemes for incentivising the investment executed by the dairy cooperative area for the growth and development of dairy infrastructure. The AHIDF has been set up as private companies and MSMEs also need to be encouraged and incentivised for their responsibility in processing and value enhancement support on the infrastructure. The qualified beneficiaries under the scheme would be MSMEs, (FPOs) farmer producer organisations, private companies, Section 8 companies, and individual entrepreneurs.

Advantages of Animal Husbandry Infrastructure Development Fund

• The beneficiaries are to provide a minimum of 10% margin capital or money as an investment. The excess 90% would be the loan segment to be made possible by registered banks.
• The Government of India will contribute 3% interest subsidy to qualified beneficiaries.
• There will be a 6-year compensation period consequently and a 2-year moratorium period for the first loan amount.
• Credit guarantee would be given to those approved schemes which are included under MSME fixed ceilings From the Credit Guarantee Fund. Guarantee coverage would be up to 25% of the Loan facility of the borrower.
• Attentive and focussed investment: Investment incentivisation in AHIDF would invest seven times the private investment.
• Higher productivity in agriculture or farming: It would also encourage the farmers to spend more on data thereby making more powerful productivity pointing to an improvement in farmers income.
• Livelihood production: The projects supported through AHIDF would also assist in a direct and complicated livelihood work for 35 lakhs.

Projects That Are Eligible for Availing Advantages under AHIDF

1. Dairy processing: Under the dairy managing foundation the EE (Economic Efficiency) can get the benefit for the establishment of the following :

2. Value-added product manufacturing: The EE (Economic Efficiency) can also get a loan for the establishment of different units and increasing on existing production units for value addition of the resulting milk products:

• Cheese manufacturing unit
• Ice cream unit
• Flavoured milk-producing unit
• Ultra-high temperature (UHT) milk manufacturing unit with tetra packaging facilities
• Milk powder production unit
• Whey powder production and manufacture unit
• Any other value addition manufacturing unit and milk products.

• Establishment of the fresh meat processing system and the strengthening of current rural meat managing facilities for goat/sheep/poultry can be prepared.
• Initiation of the fresh meat processing unit and broadening of a current meat processing unit in semi-urban and urban regions for goat/sheep/ poultry can be prepared and processed.
• Large-scale united meat processing abilities or unit or plant.
• Additionally, export-oriented multicultural buffalo meat processing abilities or plant or unit
• Integrated poultry-meat processing comforts and unit
• Pork processing unit or facilities
• Value-added products: Meat products like nuggets, sausage, ham, bacon making, salami, or any other value addition unit can also be installed as an essential part of the meat processing complement. Standalone plans for setting up of meat value computing units can also be offered under AHIDF in the current unit or new units.

The project value of various meat processing manufactory should imperatively add an effluent-treatment plant (ETP), residue-testing laboratory, meat microbiological testing laboratory, skin/hide processing areas, cold storage for keeping the offals, and their safety and preservation or refrigeration facilities for handling the chilled products and value-added outcomes for a minimum of 24 hours.

4. EE can also get the advantage for the enterprise of animal feed production and strengthening of current units or plant of the resulting sections:

• Establishment of a medium, mini, and large animal feed plant
• Enrich silage making unit
• Bypass protein unit
• Total mixed ration block-making unit
• Mineral mixture plant
• Animal feed measuring laboratory to be associated with the medium to large feed manufacturer or the EE can get the benefit for the initiation of an animal-feed testing laboratory in the current feed plant to assure quality feed.

Additional Features of the Animal Husbandry Infrastructure Development Fund

• The fund would promote incentivisation of advances in the establishment of infrastructure for dairy and meat processing and value addition foundation and initiation of animal feed plants in the private sector.
• Size of the fund is 15000 crore.
• The qualified beneficiaries under the Scheme would be;
  • MSMEs
  • farmer producer organisations (FPOs)
  • Section 8 companies(companies licensed under Section 8 of the Companies Act, 2013)
  • Individual entrepreneurs
  • Private companies
• With a minimum 10% margin capital participation by the qualified beneficiaries, the excess 90% would be the loan component to be made accessible by scheduled banks.
• The government will give 3% interest subsidy and a 2-year moratorium time for principal loan amounts with a 6-year compensation period.

Credit Guarantee Fund

• The government would further set up a credit guarantee supply of Rs. 750 crores to be managed by NABARD.
• Credit guarantee would be given to those approved schemes which are included under MSME fixed ceilings.
• Guarantee coverage would be up to 25% of the extension ability of the borrower.

Uses of AHIDF

• To help to improve or increase of milk and meat processing ability and product diversification by giving more comprehensive access for random rural milk and meat manufacturers to prepared milk and meat markets
• To make possible improved price realisation for the farmer
• To make accessible quality meat and milk products for the domestic purchaser
• To accomplish the purpose of protein-enriched quality products provision of the increasing population of the country and check malnutrition in one of the highest malnourished children population in the world
• Promote entrepreneurship and create employment
• To encourage exports and improve the export contribution in the meat and milk sector.
• To make possible quality-focused animals feed to the buffalo, cattle, goats, sheep, pigs, and poultry to implement balanced ration at affordable prices.

The AHIDF will incentivise the subsequent activities :

• Incentivising the dairy processing and diversified products’ support
• Incentivising establishment of a feed manufacturing unit.
• Incentivising the meat product manufacturing and processing infrastructure

Legal Clearance Claimed for AHIDF Project Implementation

The entrepreneurs are expected to get the required approvals, licenses, and permits for the implementation of the combined project under the AHIDF. A suggestive list of legal clearances expected is as follows:

• Local authority approvals as per the state specifications
• No objection from the property authorisation on the leaseholds ownership of the land
• Consent to Operate (CO) or Consent to Establish (COE) from the state’s pollution authority Board
• Food Safety and Standard Authority of India
• Trade License
• State Electricity Board
• Water and Air Acts
• Registration under Companies Act
• MSME Registration (only for MSMEs)
• Enrollment under the Labour Act and EPFO or Employees’ Provident Fund Organisation
• Any other legal or statutory clearances expected from the particular state to discover dairy, animal feed plant and meat processing.

Documents Required for AHIDF Loan

Documents Required for AHIDF loan are as follows:

• Complete project including component-wise cost break up, recurring cost, net income, total cost, and viability of the scheme
• Proof of address – TIN, PAN, MSME Certificate, Aadhaar Card
• Verification of landholding – purchase or lease, conversion
• Educational certificate, income proof, training certificate
• Bank report of the last six month suitable for the project
• Cite plan for the scheme
• List of device, machinery and Equipment
• List out plan (both machinery and civil) of the processing facility
• All statutory clearances (as specified above)
• Road map to assure the quality management of the scheme, product development, and business development.

What Is the Objective of AHIDF?

The Animal Husbandry Infrastructure Development Fund (AHIDF) aims to achieve the following:

• To encourage entrepreneurship and create jobs
• To encourage exports and boost the sector's export contribution of milk and meat, as well as to contribute to the expansion of India's capacity for milk and meat processing
• To provide the producer with increased price realisation
• To make wholesome milk and meat products available to home consumers
• To fulfil the objective of the protein-enriched quality food requirement of the growing population of our country
• To supply quality concentrated animals feed to cattle, buffalo, sheep, goats, pigs, and poultry in order to provide balanced rations at reasonable costs.

Process to Make Repayment of AHIDF Loan

The AHIDF loan has an eight-year maximum repayment term, including a two-year principal deferment.

The scheduled banks would distribute the entire ₹15,000 crore AHIDF fund over a three-year period beginning in 2020 and 2021.

The National Bank for Agriculture and Rural Development would establish a credit guarantee fund with a cap of ₹750 crore (NABARD). At the start of each fiscal year, the Ministry of Animal Husbandry and Dairy will contribute Rs. 75 crore for Credit Guarantee over a 10-year period.

Only viable projects that fall inside MSME ceilings will be eligible for the credit guarantee, which will cover 25% of the borrower's available credit facility.

To implement the integrated project funded by the AHIDF, the business owners must get the relevant approvals, permits, and licences. The following is a list of the necessary statutory clearances:

• Local Authority Clearances as per the State Requirements
• No objection from the land authority on the leaseholds ownership of the land
• Consent to Establish (COE) and Consent to Operate (CO) from the State pollution control Board
• Trade License
• Food Safety and Standard Authority of India
• Water and Air Acts
• State Electricity Board
• MSME Registration (only for MSMEs)
• Registration under Companies Act
• Registration under the Labour Act/ Employees’ Provident Fund Organization
• Any other statutory clearances required from the respective state to establish dairy, meat processing, and animal feed plant.

FAQs on Animal Husbandry Infrastructure Development Fund (AHIDF)

Why Vakilsearch

Vakilsearch is India’s largest professional platform of lawyers, chartered accountants, and company secretaries-with years of experience behind. We execute legal work for over 1000 companies and LLPs every month, by leveraging our tech capabilities, and the expertise of our team of legal professionals.

We make your interaction with the government as smooth as possible by doing all the paperwork for you. We will also give you absolute clarity on the process to set realistic expectations.

With a team of over 300 experienced business advisors and legal professionals, you are just a phone call away from the best in legal services.

We provide access to reliable professionals and coordinate with them to fulfil all your legal requirements. You can also track the progress on our online platform, at all times.

By handling all the paperwork, we ensure a seamless interactive process with the government. We provide clarity on the incorporation process to set realistic expectations.