Indian Economy News

Asian Development Bank (ADB) and India have agreed on a loan of US$ 130 million to advance horticulture in Himachal Pradesh

To boost farmers’ income in the state of Himachal Pradesh, the Indian government and the Asian Development Bank (ADB) agreed to a loan agreement worth US$ 130 million. The financing would be used to improve irrigation access, boost agricultural production, and support horticultural agribusinesses.

Additional Secretary, Department of Economic Affairs, Ministry of Finance, for the Government of India, Mr. Rajat Kumar Mishra and Country Director of Asian Development Bank (ADB) India Resident Mission, Mr. Takeo Konishi were the signatories to the Himachal Pradesh Subtropical Horticulture, Irrigation, and Value Addition Project.

Mr. Rajat Kumar Mishra said after he signed the loan agreement that developing subtropical horticulture in the southern parts of Himachal Pradesh, which had previously depended on temperate horticulture in the northern parts, offers opportunities for crop diversification, climate adaptation, and more equitable economic and social development throughout the state's rural areas. Fostering horticulture value chains will help increase the subsector's contribution to the growth and food security of the nation.

The project, according to Mr. Takeo Konishi, "builds on a pilot funded by ADB's project readiness facility that demonstrated subtropical horticulture production over 200 hectares and prepared the Draught Water User Association (WUA) Act and the draught state horticulture development strategy."

At least 15,000 agricultural households in the state's seven districts-Bilaspur, Hamirpur, Kangra, Mandi, Sirmour, Solan, and Una—will benefit from the project interventions by having their incomes rise and become more resilient to the effects of climate change. Due to a lack of irrigation facilities and crop damage from stray and wild animals, some households have quit farming or reduced their farming fields. With the help of the state's Jal Shakti Vibhag (Water Resources Department) and Department of Horticulture (DOH), the project will strengthen the capacity of WUAs for micro irrigation management and improve on-farm irrigation and water management in about 6,000 hectares of farmland.

The project will also assist in developing an ecosystem to improve farmers' access to subtropical horticultural markets. The growers will be divided into district-wide and cluster-wide Cooperative Horticulture Production and Marketing Associations (CHPMAs). To ensure profitability and access to markets for subtropical horticulture, CHPMA's apex institution, a Farmer Producer Corporation (FPC), would oversee state-wide agribusiness development. The FPC will oversee creating business plans, promoting agriculture, and constructing value-added facilities such as sorting, packaging, and storage facilities as well as collection and storage facilities. Additionally, it will help CHPMAs manage these facilities.

The project will also upgrade public and private subtropical horticulture nurseries for better plant health, increase beneficiary farmers' access to Information and Communication Technologies (ICTs), and implement other digital Agri-Technology systems for better CHPMA management and real-time farm advisories.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.