If a farmer from Uttar Pradesh wishes to purchase agricultural machinery but faces budget constraints, their dream may come true thanks to government support. In UP, there is an opportunity to acquire agricultural machines through government grants, with some programs potentially covering up to 100,000 rupees.
However, the subsidy amount is not guaranteed for every farmer; it depends on the specific program's conditions, the tractor's horsepower, and the available quantity of equipment.
According to the Uttar Pradesh Department of Horticulture program, a subsidy of up to 100,000 rupees can be provided for tractors up to 20 horsepower (hp), and up to 75,000 rupees for cultivators. Under this scheme, four tractors and two cultivators can be purchased.
Let's examine how much money will be required after receiving the subsidy to buy one tractor.
Suppose a farmer wants to buy a 36 hp tractor costing about 500,000 rupees, and under the program, they receive a subsidy of 100,000 rupees. In that case, 400,000 rupees will be needed to purchase one tractor, and this amount can be taken as a loan since banks offer low-interest loans.
When taking a loan from a bank for a tractor, the annual interest rate usually ranges from 7% to 14%. The loan amount can range from 200,000 to 2.5 million rupees. However, if the loan is processed through NBSFI, the interest rate can reach from 17% to 25%.
Under the central program Sub-Mission on Agricultural Mechanization (SMAM), financial assistance for agricultural machinery is provided at a rate of 40% to 50% according to established rules. However, it cannot be assumed that every tractor will receive a direct 50% discount; the support is determined by the machine category, the set maximum grant, and the beneficiary's compliance with requirements.
If we assume that a tractor costing 500,000 rupees receives a 50% subsidy from the central government, this amount will decrease to 250,000 rupees. If a subsidy of 100,000 rupees from the UP government is added to this, only 150,000 rupees will be required to purchase a 36 hp tractor. Although simultaneous approval of both subsidies for one farmer can be difficult, if such an opportunity arises, it significantly reduces the required amount.
Farmers in Uttar Pradesh can find information on booking agricultural machinery and subsidies on the official Department of Agriculture portal at https://agriculture.up.gov.in/. It is also recommended to contact the district horticulture department for information on the special tractor program. When applying, you should prepare your passport, bank account details, land documents, and other necessary certificates.