AGRISURE (AGRI FUND FOR START-UPS & RURAL ENTERPRISES) SCHEME

Minister for Agriculture and Farmers Welfare and Rural Development launched the AgriSURE (Agri Fund for Start-ups & Rural Enterprises) Scheme.

Key Features of AgriSure

Background: It was announced in Budget 2022-23
Through this, an Alternative Investment Fund (AIF) of Rs 750 crore will be established.
The Ministry of Agriculture and NABARD will contribute Rs 250 crore each to this fund and Rs 250 crore will be raised through other financial institutions.

The objective of the AgriSure initiative is to promote innovation and sustainability in India's agriculture sector and to include high risk and high impact activities in the agricultural value chain.
The fund is structured to support around 85 agriculture start-ups, each with an investment size of up to Rs 25 crore.
The fund will provide support through investments in sector specific and Alternative Investment Funds (AIFs).
The fund will also provide direct equity support to start-ups.
The fund will encourage entrepreneurship through IT-based solutions for farmers, thereby promoting sustainable growth and development in the agriculture sector.
The fund will focus on innovation in agriculture, enhancing the agricultural produce value chain, building rural infrastructure, employment generation and supporting Farmer Producer Organizations (FPOs).
The AgriSure Fund is to be operated for 10 years, which can be extended for two or more years.
Small and marginal farmers will benefit from this fund.
NABARD's wholly-owned subsidiary 'NABentures' will act as the fund manager.

There are two components of AgriSURE fund:

This component is designed to provide funding to Category I and Category II Alternative Investment Funds (AIFs) that make onward investments in Start-ups in preferred sectors of the fund.
Eligible AIFs should be incorporated in India and can be investing in equity related instruments and/or debt securities.
The scheme will require sector agnostic funds to invest into the desired number of units and/or amount into preferred sectors of scheme.
The scheme can invest up to a maximum of 5% of the corpus of the AIF or Rs 25 crore in one AIF, whichever is lower.

This component is designed to make direct equity investments in early-stage start-ups focused on agriculture and rural development in India. These early-stage start-ups should be recognised by the Department for Promotion of Industry & Internal Trade (DPIIT) and should be incorporated in India.
The scheme can invest a maximum of Rs 25 crores in a single start-up, subject to AIF regulations.
The scheme will invest in equity, compulsorily convertible preference shares or other equity related instruments.
The scheme may reinvest in successful portfolio companies during subsequent funding rounds to
Duration: The fund’s duration is 10 years from the date of inception which can be extended by two years.

To attract more investments into the agriculture and rural start-up ecosystem by contributing to various Alternative Investment Funds (AIFs).
Providing liquidity to existing agriculture and agri-tech start-ups that are unable to scale their businesses due to lack of access to various forms of financing such as equity, debt instruments, etc.
To encourage young entrepreneurs to take higher risks while engaging in high-impact activities in agriculture and agro-technology.
To promote opportunities for profitable forward and backward linkage systems to strengthen the agricultural produce value chain system and to bring new entrepreneurs into the agribusiness sector.
To involve more and more players in the agricultural ecosystem so that Farmer Producer Organizations (FPOs)/Farmer Producer Companies (FPCs)/Primary Cooperative Societies can access the latest automated agricultural processes and machinery through agritech start-ups.
To create additional employment opportunities for technically qualified rural and urban youth so that they can take up agriculture as a vocational opportunity.