AHIDF Scheme: Eligibility, 3% Subvention and How to Apply

Reviewed by: WeCredit Research Team

The Animal Husbandry Infrastructure Development Fund (AHIDF) helps entrepreneurs, companies, farmer producer organisations and dairy cooperatives build dairy, meat processing, animal feed and similar plants. A scheduled bank or NCDC gives the term loan, and the government pays a 3% interest subvention to the lender for up to 8 years.

AHIDF at a Glance

Item	What the official sources say
What it is	A fund under the Department of Animal Husbandry and Dairying that supports investment in dairy, meat, feed and related infrastructure
Who can apply	Individual entrepreneurs, private companies, Section 8 companies, MSMEs, farmer producer organisations (FPOs) and dairy cooperatives
Loan cover	Term loan of up to 90% of the project cost from a scheduled bank or NCDC, with no rupee ceiling on credit
Your contribution	10% for micro and small units, 15% for medium enterprises, 25% for other entrepreneurs (lender pages)
Subsidy	3% interest subvention a year for up to 8 years, including a 2-year moratorium on principal
Interest rate	For MSME projects, not more than EBLR plus 200 basis points
Credit guarantee	Up to 25% of the credit facility for MSME projects, from a Rs 750 crore guarantee fund
Apply at	ahidf.udyamimitra.in, then a scheduled bank

What AHIDF Funds

According to PIB, AHIDF covers dairy processing and value addition facilities, meat processing and value addition units, animal feed manufacturing plants, breed enhancement technology and breed multiplication farms, veterinary vaccine and medicine production centres, animal waste management solutions and wool processing facilities. It is a scheme for plants and infrastructure, not for running costs. The scheme guidelines do not allow subvention on land, working capital, old machinery or vehicles for personal use.

If your project is a post-harvest or farm-gate asset rather than an animal husbandry plant, the Agriculture Infrastructure Fund loan may fit better.

Who Is Eligible

• The applicant must be an individual entrepreneur, private company, Section 8 company, MSME, FPO or dairy cooperative.
• The project must fall in one of the activities listed above.
• The loan must come from a scheduled bank, NCDC, NABARD, NDDB or SIDBI route as set out in the scheme, and the term loan can cover up to 90% of the project expense.
• The term loan sanction date must not be before 1 April 2023. A DAHD office order of August 2025 changed the earlier cut-off of 24 June 2020 to this date, with effect from 1 April 2025. Projects already applied for and marked eligible by the department are exempt.
• Land must be available before you submit the proposal. The guidelines accept ownership, or a long-term lease of at least 30 years, and ask for proof that the land is free from encroachment and encumbrance.

How the 3% Interest Subvention Works

The government pays the 3% subvention to your bank, not to you. In practice your effective cost falls by 3 percentage points for regular repayment, for up to 8 years of the loan including the moratorium. The bank is paid the first year of subvention upfront under the guidelines. A moratorium of up to 2 years on principal is allowed and varies by project. Lender pages state a maximum total repayment period of 10 years including moratorium, but the subvention runs only for the first 8.

Worked example (illustrative numbers)

Suppose a micro dairy processor plans a plant costing Rs 4 crore on eligible items. The loan can cover up to 90%, so up to Rs 3.6 crore, and the promoter puts in at least 10%, which is Rs 40 lakh. If the bank charges 10% a year on the loan, a borrower who repays regularly effectively bears about 7%, because 3% is met by the subvention. On the full Rs 3.6 crore, 3% is about Rs 10.8 lakh in the first year, falling as the principal reduces. These figures are only an illustration. The bank computes the real subvention on your outstanding balance, and your rate depends on the lender and your profile.

Credit Guarantee for MSME Projects

For MSME projects, AHIDF offers a guarantee of up to 25% of the credit facility from a Rs 750 crore Credit Guarantee Fund managed by NABSanrakshan Trustee Company. The guidelines also allow micro and small units to use the CGTMSE route for part of the loan. To understand how that cover works, read about the CGTMSE credit guarantee. The guarantee protects the lender, not you, so you still repay in full.

Documents You Will Need

The AHIDF implementation guidelines list these items for the online application. Your bank may ask for more.

• Detailed project report with component-wise cost, recurring cost, expected income and viability
• Proof of address, PAN or Aadhaar, and MSME (Udyam) certificate if you are an MSME
• Balance sheets for the last three years and bank statements for the last six months
• Proof of land ownership or lease, and change of land use where applicable
• Site plan, list of machinery and equipment, and a layout plan certified by a registered architect
• Statutory clearances such as trade licence, State Pollution Control Board consents to establish and operate, and an FSSAI licence where relevant
• A roadmap for quality management, product promotion and market development

These come from the Implementation Guidelines 2.0. The department later issued Guidelines 3.0 (14 January 2025), so ask your bank for its current checklist.

How to Apply: Step by Step

1. Prepare the detailed project report. Handholding agencies are listed on the AHIDF portal.
2. Submit your proposal and DPR online at ahidf.udyamimitra.in, the portal built by SIDBI, naming the bank you want to approach.
3. The Department of Animal Husbandry and Dairying screens the application and marks it eligible, returned or rejected.
4. Eligible applications go to your bank, which appraises the project and sanctions the loan.
5. A project approval committee approves the interest subvention for projects up to Rs 50 crore. Larger projects go to a project sanctioning committee.
6. For MSME projects, the committee recommends the credit guarantee after the loan is sanctioned.
7. Draw down the loan within six months of sanction and start the project within 12 months.

Rejection and Delay Reasons, and Fixes

Problem	Why it happens	Fix
Land not ready	The guidelines need land acquired and free from encumbrance before submission	Complete the purchase or a lease of at least 30 years first
Costs on ineligible items	Land, working capital, old machinery and personal vehicles get no subvention	Keep these out of the project cost
Sanction date before 1 April 2023	The cut-off applies from 1 April 2025	Confirm the cut-off with your bank
Incomplete DPR or clearances	The department can return an application	Attach every clearance and certified layout plan
No drawdown within six months	The project becomes a non-starter	Plan disbursement milestones with the bank
Not grounded within 12 months	The sanction lapses	Line up contractors and approvals early

AHIDF Compared With Related Schemes

	AHIDF	Agriculture Infrastructure Fund	PM FME	CGTMSE-backed loan
Main purpose	Dairy, meat, feed and animal husbandry plants	Farm-gate and post-harvest agri infrastructure	Micro food processing units	Collateral-free loans for micro and small enterprises
Type of help	3% interest subvention and a credit guarantee	Interest support and guarantee on infrastructure loans	Credit-linked subsidy	Guarantee only
You apply to	AHIDF portal, then a bank	Scheme portal, then a bank	Bank or state nodal agency	A member lender

If your unit is a small food business rather than an animal husbandry plant, see the PM FME scheme.

Is AHIDF Right for You? Checklist

• My project is a dairy, meat, feed, breeding, vaccine, waste or wool facility.
• I am an eligible entity type and can fund my 10% to 25% contribution.
• I own or hold a long-term lease on land that is free from encumbrance.
• I can prepare a DPR and the statutory clearances.
• My bank confirms it is accepting new AHIDF applications.

Security, Repayment and Costs

Lender pages describe the primary security as hypothecation or mortgage of the assets created out of the bank finance, such as the plant, buildings, machinery and stock. Units that are not covered by a credit guarantee may be asked for minimum collateral, which the SBI page puts at 30% of the loan limit for entities outside the guarantee route. Repayment is spread over a maximum of 10 years including the moratorium, and the moratorium itself is a maximum of 2 years from the date of disbursement and varies from project to project.

The interest rate is set by the lender. For MSME projects the scheme says it should not exceed EBLR plus 200 basis points, where EBLR is the bank’s external benchmark based lending rate. For other entities the SBI page says projects below Rs 50 lakh follow the same EBLR plus 200 basis points, while larger projects follow the bank’s own guidelines. Ask the bank for the exact spread and any processing fee in writing, because the scheme documents do not fix a processing fee.

Typical Timeline From DPR to Disbursement

Stage	Who acts	What you do
1. Project preparation	You or a handholding agency	Secure land, finalise the DPR, collect clearances
2. Online submission	You	Upload the proposal and documents on the AHIDF portal
3. Eligibility screening	Department of Animal Husbandry and Dairying	Respond if the application is returned
4. Bank appraisal and sanction	Scheduled bank	Answer queries, sign the sanction letter
5. Subvention approval	Approval or sanctioning committee	Nothing to submit, track through the bank
6. First drawdown	Bank	Draw within six months of sanction
7. Project grounded	You	Start the project within 12 months of sanction

The scheme documents do not promise a fixed number of days for any stage, so treat the order of steps as the guide and the dates as the bank’s to confirm.

Questions to Ask Your Bank Before You Apply

• Is the bank accepting new AHIDF proposals today, and from which sanction date will it consider a loan?
• What spread over EBLR will apply, and are there processing or legal fees?
• Will the credit guarantee be sought for my project, and who pays its cost?
• How much moratorium will the bank allow for my plant, and when does the first instalment fall due?
• Which items in my cost estimate will be treated as eligible for subvention?

Common Mistakes

• Expecting the 3% to be paid to you. It goes to the lender.
• Including land or working capital in the subsidised project cost.
• Starting civil work before the sanction and clearances are in place.
• Paying agents for a “guaranteed approval”. Apply only on the official portal and through banks.

WeCredit does not sanction government scheme loans. For other options, browse our government loan schemes hub.

Frequently Asked Questions

Is AHIDF still open?

The latest official validity is up to 2025-26. A July 2026 PIB release still lists AHIDF but gives no new end date. Check the portal and your bank.

How much interest subvention does AHIDF give?

3% a year for up to 8 years including a 2-year moratorium, paid to the lender for regular repayment.

What is the maximum loan under AHIDF?

The scheme states no rupee ceiling on credit. The term loan can cover up to 90% of the project cost.

Who can apply for AHIDF?

Individual entrepreneurs, private companies, Section 8 companies, MSMEs, FPOs and dairy cooperatives.

Is collateral needed?

MSME projects can get a guarantee of up to 25% of the credit facility. Lender pages say units without guarantee cover may need collateral, and the bank also takes the assets created from the loan as security.

Where do I apply for AHIDF?

Online at ahidf.udyamimitra.in, followed by bank appraisal and sanction.