Operation Greens

Operation Greens is a scheme that has been launched by the Food Processing Industries to support Farmer Producers Organizations (FPOS), processing facilities, agri-logistics and professional management. In this article, let us take a closer look at the scheme.

Objectives

The objectives of Operation Greens aims at

• Enhancement of value realisation of TOP (Tomato, Onion and Potato) farmers by targeted interventions to strengthen production clusters, their FPOs and link/connect them with the market.
• Price stabilisation for consumers and producers by proper production planning in the TOP clusters and introduction of dual-use varieties.
• Reduction of post-harvest losses by creating farm gate infrastructure, development of suitable agro-logistics and creation of appropriate storage capacity linking consumption centres.
• Development of food processing capacities and value addition in the TOP value chain with firm linkages of production clusters.
• Establishment of market intelligence network to collect and collate real-time data on demand, supply and price of TOP crops.

Strategies

The strategies adopted by Operation Greens are divided into price stabilisation measures (for short term) and integrated value chain development projects (for long term).

Short Term Price Stabilisation Measures

NAFED would be serving as the nodal agency to implement price stabilisation measures. MoFPI provides 50% of the subsidy on the below-given components:

• Transportation of TOP crops from the production to storage.
• Hire appropriate storage facilities for TOP crops.

Long Term Integrated Value Chain Development Projects

• Capacity Building of FPOs and their consortium
  • Formation of New FPOs in the clusters selected for TOP
  • Promotional activities, training/workshop of farmers and FPOs
  • Professional Management Support to FPOs and Federation
• Quality production
  • Provision for quality inputs such as seeds
  • Construction of nursery and greenhouses
  • Establishing protected cultivation
  • The mechanisation of farm practises
  • Promote contract farming
  • Varietal change depending on the market
• Post-harvest processing facilities
  • Appropriate storage at farm level
  • Collection centre (CC)/pack house
  • Primary processing like sorting, grading and packaging facilities
  • Secondary processing that covers any mechanised and mobile processing facilities
  • Appropriate transportation infrastructure
• Agri-Logistics
  • Integrated multi-mode appropriate transportation
  • Controlled temperature/ventilated trucks with or without ranking
  • Crates, rakes etc.
  • Medium/large scale storage at regional, state and national level
• Marketing/Consumption points
  • Appropriate storage facilities at aggregation/market level
  • Sorting, grading and packaging facilities
  • Establishing retail outlets
  • Establishing marketing yards at cluster level
  • Creation of e-market
• Creation of e-platform for demand and supply management of TOP crops

Eligible Organizations

Organizations of the following categories are eligible for this scheme.

Price Stabilization Measures

The organizations that are eligible for Price Stabilization Measures are existing State Marketing Federation, Co-operative Federations, FPOs/FPCs/farmers group/grower associations/aggregators, Central/State PSUs (such as CONCOR), private transportation/agri-logistics/warehouse operators, supply chain operators etc. engaged in transportation/warehousing/marketing TOP crops depending on transparent criteria, for transportation and hiring of appropriate storage at production and consumption centres.

For Integrated Value Chain Development Projects

State Agriculture and other marketing federations, FPOs, cooperatives,

self-help groups, companies, logistic operators, service providers, food processors, supply chain operators, retail and wholesale chains and central and state governments and their entities/organizations would be eligible to participate and avail the financial assistance. An organization, a group of organizations or individual who undertakes any activity with financial assistance under the project, would be referred to as the Project Implementing Agency (PIA).

Assistance Pattern

For Price Stabilization Measures

50% of the cost of transportation and 50% of the cost of hiring appropriate storage facilities would be provided as subsidy during the harvest of the crops. Storage facilities would be hired for a maximum of six months. NAFED would be the nodal agency for distributing subsidies to the eligible organizations.

For Integrated Value Chain Development Projects

The scheme has to have all the components as it works for the integrated development of TOP chain value. The Post-harvest processing facilities are mandatory components of the Integrated Value Chain Development project. The projects that incorporate secondary processing facilities would be given preference in selection. The projects that are eligible for grant-in-aid at the rate of 50% of the eligible project cost in all areas are subjected to a maximum of Rs. 50 Crore for every project. On the other hand, if PIAs are FPOs, the grant-in-aid would be at the rate of 70% of the eligible project cost in all areas and subject to a maximum of Rs. 50 Crore for every project. The eligible costs exclude the cost of the land and pre-operative expenses. The cost norm for several components under the scheme to determine the maximum cost of components are given below:

• Capacity Building of FPOs and their consortium - SFAC norms.
• Quality production - MIDH norms that have to be met by the Ministry of Agriculture.
• Post-Harvest processing facilities - MIDH norms, if MIDH is unavailable. MoFPI determines the cost norms with the approval of the Inter-Ministerial Committee.
• Agri-logistics - MIDH norms. If MIDH is unavailable, MoFPI determines the cost norms with the approval of the Inter-Ministerial Committee.
• Marketing and aggregating points - MIDH norms.
• If MIDH is unavailable, MoFPI determines the cost norms with the approval of the Inter-Ministerial Committee.

If required, a maximum of 5% of the total annual allocation under the scheme could be utilised for administrative expenses by the MoFPI/NAFED/State Governments.

Release of Funds

Once the project is granted for final approval, the grants would be released by MoFPI subject to the fulfilment of conditions that are prescribed for each instalment:

• The first instalment of 30% of the approved grant would be released to the PIA, upon the following conditions:
  • Establishment of Trust and Retention Account (TRA).
  • Appointment of the Ministry's nominee director on the Board/Governing body of PIA.
  • Consent to establish.
  • Award of contracts that are equal to 30% of the total project cost.
  • Expenditure from CA confirming expenditure of at least 10% of the eligible project cost on the eligible components of the project.
  • Proof of formation of new FPOs/promotion of existing FPOs in the cluster and their registration/tie-up with the existing FPOs in the cluster/linkages with the farmers and farmer's group.
  • Proof of arrangement that is made for quality products as proposed in DPR.
  • Recommendation of PMA that confirms the fulfilment of the above-mentioned regulations.
• The second instalment of 30% of the approved grant would be released to the PIA, upon the following conditions:
  • Utilization Certificate for the grant released as the first instalment.
  • Proof of proportionate contribution by PIA from term loan and promoter's contribution in TRA account.
  • Proof of proportionate expenditure by PIA from the term loan and equity of the eligible project.
  • Proof of commensurate physical progress, approximately 30% in all the components.
  • Recommendation of PMA confirming the fulfilment of the mentioned regulations.
• The third instalment of 30% of the approved grant would be released to the PIA, upon the following conditions:
  • Utilization Certificate for grant released as the second instalment.
  • Proof of proportionate contribution by PIA from term loan and promoter's contribution in TRA account.
  • Proof of proportionate expenditure by PIA from term loans and equity.
  • Proof of commensurate physical progress, approximately 60% in all the components.
  • Recommendation of PMA confirming the fulfilment of the above conditions.
• The fourth and final instalment of 10% of the approved grant would be released to the PIA upon the following conditions:
  • Utilization Certificate.
  • Proof of 100% contribution by PIA from term loan and promoter's contribution in TRA account.
  • Proof of 100% expenditure by PIA from the term loan and promoter's contribution to the project.
  • Completion and commissioning of the project.
  • Consent to operate.
  • Recommendation of PMA confirming the fulfilment of the above regulations.

Outcomes of the Scheme

The scheme is expected to result into capacity building of FPOs through their professional development, reduction of post-harvest losses, creation of preservation and processing infrastructure, provision of agri-logistics for supply chain, price stabilisation for consumers and producers, and preventing distress sale by TOP farmers.

Jurisdiction of Court

Disputes that arise from conditions stipulated in the guidelines, selection of proposals and implementation of the scheme would be subject to courts/tribunals having jurisdiction over Delhi.