The Government of India has approved a one-time, interest-free working capital assistance of ₹50,000 per barn for Flue-Cured Virginia (FCV) tobacco growers in Andhra Pradesh under the Interest-Free Working Capital Assistance Scheme. This financial intervention, totaling approximately ₹220 crore, will benefit around 44,000 growers and is proposed to be provided directly to farmers through Direct Benefit Transfer (DBT).
The assistance is intended to provide immediate liquidity to growers, enabling them to meet household requirements, repay institutional loans, purchase inputs for the ensuing crop season, and reduce dependence on private borrowing. This initiative comes amid evolving global market conditions for tobacco, including changing demand patterns, geopolitical developments, and evolving international trade dynamics that have influenced procurement and marketing conditions.
Auctions for the 2025-26 crop season in Andhra Pradesh commenced on March 25, 2026, with approximately 100 million kg of FCV tobacco auctioned so far. FCV tobacco is predominantly cultivated in Andhra Pradesh and Karnataka. The government is undertaking coordinated measures to facilitate procurement, enhance market participation, and promote exports, with continuous engagement with exporters, buyers, growers, and other stakeholders to facilitate smooth marketing of the crop and strengthen the FCV tobacco sector.