Cold Chain Schemes

Cold Chain Schemes are subsidy based assistance schemes by Govt of India. Financial assistance is provided through the State Govt. or directly to the eligible cooperatives. NCDC is a nodal agency of the Government of India for implementing schemes of various Ministries. NCDC will make every effort to avail subsidy from all the Ministries of the GOI. These efforts are for the benefit of cooperative Cold chain projects.

Cold Chain is an uninterrupted temperature-controlled logistic chain, ensuring market link from farm gate to the consumer. It is a kind of supply chain that is specialized in the storage, transport, and preservation of cargo. These goods need to be maintained at a specific temperature. They may also needs management within an acceptable temperature range, humidity, and other conditions. It maintains and prolongs the shelf life of products. These include fresh agricultural produce, seafood, frozen food, photographic film, and chemical and pharmaceutical drugs. Such products during transport and when in transient storage, are sometimes called cool cargo. Unlike other goods or merchandise, Cold Chain goods are perishable. They are always en route towards end use or destination, even when held temporarily in cold stores. Hence, they are commonly referred to as cargo during its entire logistics cycle.

Integrated Post Harvest Management projects through National Horticulture Board (NHB)

Credit linked back ended subsidy @ 35% of project cost limited to Rs.50.75 lakh per project in general areas and @ 50% of project cost limited to Rs.72.50 lakh per project in Hilly, North East & Scheduled Areas. The assistance is provided under NHB schemes for establishment of integrated pack house. It includes pre-cooling units, cold room, mobile pre-cooling unit, ripening chambers and refrigerated transport vehicle.

Pattern of assistance under Integrated Post Harvest Management projects will be as under:

Higher subsidy is available for some small components. These include small pack house with size of 9 M*6 M, evaporative/low energy cool chamber (8 MT), preservation unit (low cost), low cost onion storage structure (25 MT), and Pusa Zero energy cool chamber (100 kg). In these cases, 50% of the total cost is provided as subsidy.

Capital Investment Subsidy Scheme of National Horticulture Board (NHB)

Credit linked back ended subsidy @ 35% of project cost limited to Rs.50.75 lakh per project in general areas and @ 50% of project cost limited to Rs.72.50 lakh per project in Hilly, North East & Scheduled Areas, is provided under NHB schemes for establishment of integrated pack house, pre-cooling units, cold room, mobile pre-cooling unit, ripening chambers and refrigerated transport vehicle.

Pattern of assistance under Integrated Post Harvest Management projects will be as under:

Agricultural Marketing Infrastructure (AMI) Sub Scheme of Integrated Scheme for Agriculture (ISAM) – for Non – Storage Infrastructure Projects

Funding pattern under AMI scheme:-

Other than the above mentioned schemes NCDC also provides financial assistance for Cold Chain projects under Dairy Processing & Infrastructure Development Fund (DIDF), Fisheries and Aquaculture Infrastructure Development Fund (FIDF) & Pradhan Mantri Matsya Sampada Yojana (PMMSY).

Through Ministry of Food Processing Industries (MoFPI):

In the case of Cold Chain scheme of MoFPI, cost norms of MIDH/NHB/NHM scheme will be followed wherever applicable. Pattern of assistance will also be same as given in the above table. For facilities not covered under MIDH guidelines, cost norms as determined by the MoFPI will be followed. For value addition and processing infrastructure including frozen storage / deep freezers associated and integral to the processing, grant-in-aid 50% for General Areas and 75% for North-East, Hilly States, & difficult areas, will be provided. Maximum grant-in-aid under Cold Chain scheme of MoFPI would be Rs.10 crore per project. Further details can be checked from the Ministry’s website http://www.mofpi.nic.in

In addition to assisting the cooperatives in setting up of Cold Chain infrastructure/ components as per the pattern of assistance given above, NCDC also provides working capital assistance for undertaking business operations by the cooperative assisted for Cold Chain facilities.

All project proposals assisted under MIDH/NHM/NHB various schemes for setting up of Cold Chain infrastructure/components are required to comply, without fail, with the extant specifications standards and protocols on Cold Chain components prescribed by them and as revised and updated from time to time by any authorized agency like National Centre for Cold Chain
Development (NCCD), etc., otherwise subsidy may be refused by the above agencies. The State Governments/societies may be requested to adhere to the technical standards and protocols etc. while preparing the Detailed Project Report for assistance for setting up of Cold Chain infrastructure/components. In order to claim subsidy from NHB, time limit for completion of the project
would be maximum of 18 months period from the date of disbursement of 1st instalment of term loan, which may be extended for a period of 3 months, if reasons for delay are considered justified by NCDC and agreed to by NHB.

Mode of Funding

Financial assistance is provided through the State Govt. or directly to the eligible cooperatives.

Eligible Cooperative Societies:
NCDC provides assistance to primary, district and state level cooperatives

Quantum of Assistance and Pattern of Assistance

Varies from activity to activity and upto 90-95% of the total cost for the most of the activities. However, in case of strengthening of share capital base/margin money/working capital assistance, the quantum of assistance can be up to 100%.

Yuva Sahakar – Cooperative Enterprise Support and Innovation Scheme:

To encourage newly formed cooperatives take advantage of innovative ventures, especially by societies with new/innovative idea, NCDC has introduced a new scheme titled, “Yuva Sahakar – Cooperative Enterprise Support and Innovation Scheme” linked to a Cooperative Start-up and Innovation Fund created by NCDC. Please click for details of the Scheme.

Norms for direct funding

Cooperatives operating for minimum three years & broadly fulfilling following criteria are eligible:
(i) Net worth should be positive.
(ii) There should be no erosion in share capital.
(iii) Should be in a position to provide 1.25 to 1.5 times security.
(iv) Financial/operational performance of the cooperative should be at satisfactory level of NCDC.

Common Loan Application Form : for availing assistance under the scheme of NCDC can be seen here from NCDC’s website. http://www.ncdc.in

Frequently Asked Questions (FAQ)

Q – What is a Cold chain?

A – An environmentally controlled logistics chain, ensuring uninterrupted market link from farm-gate to the consumers. It consists of refrigerated storage and distribution related activities in which the crop/produce is maintained within predetermined ambient parameters relating to temperature, humidity, etc.

Q – What are the major components of Cold chain?

A – Modern Pack Houses with Pre-coolers and a small cold room
Transportation (Refrigerated / normal trucks depending on product)
Cold Storage (Bulk) at farm gates for long term inventory
Cold Storage (Hub) near Consumption Centres as a distribution platform
Ripening Units

Q – What is a Cold Storage?

A – A frozen storage system with installed and refrigerated chamber is called cold storage. It is a large warehouse building for long term storage of bulk quantity of agricultural produce and other perishable commodities.

Q – What is the difference between Cold Storage and Cold chain?

A – Cold storage is a static part of Cold chain which can help in preservation of perishable commodities. On the other hand, Cold chain actually helps in marketing of those commodities at a lucrative price in distant markets which is more important for the farmers and a necessary requirement.

Q – What are the advantages of Cold chain?

A – i) Reduces the loss of agricultural and other perishable commodities like food, fruits & vegetables meat, meat products, seafood, etc. till it reaches the consumer.
ii) Preserves and extends the shelf life and safeguards nutrient quality of products.
iii) Improves domestic food supply, leads to improved nutrition and food safety, adds to farmer’s income and helps in lowering market price for local population.
iv) New jobs would be created all along the Cold chain.

Q – Whether all the Cold chain components are necessary in every Cold chain project?

A – No. Every Cold chain project will have components as per its own requirements. Thus, assistance can be availed for a combination of two or more Cold chain infrastructure components by a cooperative, within the prescribed norms of individual items.

Q – Role of NCDC in Cold chain development?

A – NCDC is a nodal agency of the Government of India for implementing schemes of various Ministries. As such, NCDC will make all efforts to avail subsidy from all the Ministries of the GOI for the benefit of cooperative Cold chain projects. However, for one Cold chain project, subsidy can be availed from one source only.

Most of the programmes of GOI for development of Cold chain projects are credit linked back ended subsidy schemes. This means that the cooperative has to first tie-up all the loan requirements for its Cold chain programme and only then it is eligible for subsidy. Here, comes the role of nodal agencies like NCDC from which loan assistance can be availed and thereafter subsidy can be dovetailed for the project.

Q – What are the schemes of NCDC for Cold chain?

A – Through Mission for Integrated Development of Horticulture (MIDH) / National Horticulture Board (NHB) / National Horticulture Mission (NHM) : After tying up the loan portion, subsidy @ 35% of project cost limited to Rs. 50.75 lakh per project in General Areas and @ 50% of project cost limited to Rs. 72.50 lakh per project in Hilly, North East and Scheduled areas is provided for Cold chain components as given in question no. 2 above. However, higher subsidy is available for some small components, the details of which and the details of cost norms, pattern of assistance, operational guidelines, etc. may be seen at websites like http://www.midh.gov.in, http://www.nhb.gov.in.

Secondly, Through Ministry of Food Processing Industries (MoFPI) : For development of Cold chain infrastructure, the quantum of subsidy will be the same as in the case of MIDH/NHB/NHM. However, for value addition and processing infrastructure including frozen storage/ deep freezers associated and integral to the processing, grant-in-aid @ 50% for General Areas and @ 75% for North East States, Himalayan States, ITDP Areas & Islands, will be provided. Maximum grant-in-aid would be Rs. 10 crore per project.

Q – Procedure for availing financial assistance from NCDC?

A – The cooperative society should prepare a Detailed Project Report (DPR) with all the financials and submit the same to the NCDC. The cooperative may submit its proposal either through the State Government with their guarantee or the societies which fulfil direct funding guidelines of NCDC may apply directly to NCDC for sanction of assistance. Direct funding guidelines of NCDC are available on NCDC website i.e. http://www.ncdc.in. If the proposal of the cooperative is found in order, technically feasible and financially viable by the NCDC, loan component for the project shall be sanctioned by NCDC. Thereafter, full guidance will be provided by the NCDC to the cooperative for their sanctioned projects in availing loan as well as subsidy.