New Delhi, July 31 The Union Cabinet, chaired by Prime Minister Narendra Modi, on Thursday approved the Central Sector Scheme grant in aid to National Cooperative Development Corporation (NCDC) with an outlay of Rs 2,000 crore for a period of four years from 2025-26 to 2028-29, which works out to Rs 500 crore for each year.
On the basis of this grant in aid of Rs 2,000 crore, NCDC will be able to raise Rs 20,000 crore from the open market over a span of four years. These funds will be utilised by NCDC for granting loans to Cooperatives for setting up new projects, expansion of plants and loans for meeting working capital requirements, according to an official statement issued after the Cabinet meeting.
The source of finance of the Rs 2,000 crore grant to NCDC will be through budgetary support from the Government of India.
Approximately 2.9 crore members of 13,288 cooperative societies of various sectors like Dairy, Livestock, Fisheries, Sugar, Textile, Food Processing, Storage and Cold Storage; Labour and Women-led cooperatives. across the country are likely to benefit by the approval of the NCDC grant, the statement explained.
NCDC will be the executing agency for this scheme for the purpose of disbursement, follow up, monitoring of implementation of project, and recovery of loan disbursed out of the fund.
It will provide loans to cooperatives either through state government or directly, as per its guidelines. Cooperatives, which are meeting the criteria of direct funding guidelines of NCDC, would be considered for financial assistance directly against admissible security or state government guarantee, the statement said.
NCDC will also provide loans to cooperatives, long-term credit for setting up new projects as well as for modernizing or expanding existing project facilities for various sectors and working capital to run their businesses efficiently and profitably, the statement added.
Funds provided to these cooperatives will lead to creation of income generating capital assets and provide cooperatives with much needed liquidity in the form of working capital.
In addition to economic benefits, cooperatives through their principles of democracy, equality and community concerns are an essential tool to bridge the socio-economic gap and increase participation of women in the workforce, the statement explained.
The availability of loans will help cooperatives in their capacity augmentation, modernisation, diversification of activities, increasing their profitability and enable them to increase their productivity and generate more employment and improving the economic conditions of the farmer members.
Additionally, term loans for infrastructure development also create widespread employment opportunities across different skill levels, the statement added.
Disclaimer: This post has been auto-published from an agency feed without any modifications to the text and has not been reviewed by an editor