Government Schemes & Policies for Agri Startups in India: Funding Procedure
Posted on September 28, 2025
The economy is still heavily dependent on agriculture, with approximately half of the population deriving a livelihood from it. With advancements and innovations, a new crop of agri startups is out there transmuting traditional farming into modern commercial ventures. Startups are addressing gigantic challenges thrown at the industry-from precision farming and agri-tech platforms to organic food companies.
That is not to say that great ideas do not need funding! Thus, a number of schemes and policies have been introduced by the Government of India for the development of innovation in agriculture. The knowledge of these schemes is the first step an entrepreneur must take while trying to start or enlarge their agri business to seek help.
So, let’s run aground major government policies and schemes for agri startups in India and how you can tap into such benefits.
Why Government Support is Needed for Agri Startups
Far more than many other industries, agriculture has inherent risks-climate volatility, pressing inputs, and unpredictable market returns. For fledgling startups, this is usually enough to deter investors. Support from the government fills this void through financial assistance, mentoring, developing infrastructure, and exposure to networks that allow agri startups to grow.
The schemes, rather than just providing for the money, also provide for:
- Subsidies for acquiring equipment and technology.
- Access to credit and loans at lower interest rates.
- Grants for R&D and for pilot projects.
- Incubation and networking with incubators, universities, and global markets.
Government Schemes for Agri Startups
1. Rashtriya Krishi Vikas Yojana (RKVY – RAFTAAR)
Aim: To encourage entrepreneurship and innovation in agriculture and allied sectors.
What It Provides:
- – Incubation centres that provide seed funding support to startups.
- – Idea-stage startup grants of up to ₹25 Lakh.
- – Growth-stage startups up to ₹5 Crores.
How To Apply: Entrepreneurs apply through approved RKVY-RAFTAAR incubation centres hosted within different agri universities and institutes across India.
2. Agriculture Infrastructure Fund (AIF)
Objective: Provide financing for post-harvest management and community farming assets.
What It Offers:
- – Medium- and long-term debt financing with an interest subsidy of 3%.
- – Credit guarantee coverage for loans of up to ₹2 crore.
- – Support for warehousing, cold storage, grading, and processing units.
How to Apply: One can submit an online application through the AIF portal, which allows startups to submit proposals directly and contact lending institutions.
3. Pradhan Mantri Formalisation of Micro Food Processing Enterprises (PM-FME) Scheme:
Objective: This may support micro food processing industries, including agri startups concerned with value-added products.
What It Offers:
- – Credit-linked subsidy of 35% project costs is eligible(up to ₹10 lakh).
- – Capacity-building, skill training, and branding assistance.
- – Support cluster-wise food processing industries.
How to Apply: Eligible startups may apply through state nodal agencies or the specifically designed online portal for schemes.
4. NABARD Support for Agri Startups
Objective: Foster agri-innovation through incubation and funding.
What It Provides:
- – Funding through the Rural Innovation Fund for scalable solutions.
- – Grants, loans, and equity participation for agri-tech ventures.
- – Easy access to credit through collaboration with rural banks and cooperatives.
How to Apply: Startups can reach out to NABARD-funded incubators or directly visit NABARD offices with project plans.
5. Startup India Seed Fund Scheme (SISFS)
Goal: To nurture early-stage startups, including agricultural startups.
What It Offers:
- – Seed funding of up to Rs. 20 lakhs for prototype development.
- – A grant of up to Rs. 50 lakhs for entering markets and commercialization.
- – Incubators are recognized and well-known throughout India.
How to Apply: The application process is conducted through the Startup India portal, where qualifying startups can apply under the scheme.
How Agri Startups Can Access Funding?
There are enormous government funding opportunities, but they must be accessed with clarity and planning. Below are some action steps:
- – Identify the Right Scheme – Study your business model and match it with the scheme that best fits your needs. For example, if you’re building cold storage, AIF is ideal; for food processing, PM-FME works better.
- – Register as a Startup – Your company must be registered with Startup India to be able to avail of most state-sponsored central schemes.
- – Connect with Incubators- Many schemes like RKVY and NABARD operate through incubators. Being part of one will increase your chances of getting funds and mentoring.
- – Prepare a Strong Proposal- Speak about your innovation, scalability, and impact on farmers’ livelihoods. It increases the credibility of your business plan.
- – Stay Updated- Government policies keep changing frequently. Track announcements from the Ministry of Agriculture, NABARD, and Startup India.
Snapshots of Agri Startup Success that Leverage Schemes
- – AgroWave: The farm-to-business supply chain startup profited from schemes initiated by Startup India to scale its operations at the state level.
- – Ninjacart: The government funds and collaborates with incubators to become an eminent grocery logistics platform in India.
- – Ecozen Solutions: Famous for solar-powered cold storage, this company used the NABARD route and was able to lure international investors.
These examples map government funding from conceiving an idea to transforming it into a household name.
Conclusion:
India and Agriculture in the 21st Century
One of the greatest transformations is occurring within Indian Agriculture and agri startups. The government has put forth good policy frameworks coupled with liberal funding schemes and incubation facilities so that the entrepreneurship culture may flourish and further innovative aptitude may be nurtured.
Are you doing something in farm automation or maybe working on food processing or supply-chain? Then there surely is a scheme designed for you to follow through with your idea. Getting to know the right scheme to apply for, putting together a good plan, and practically using the schemes granted form the key.
Agri entrepreneurs, the time to act is now, with the right kind of funding; your great idea could be the next big success story in India’s agricultural revolution.