India's Decentralized Grain Storage Plan Achieves Significant Capacity Expansion
The Decentralised Grain Storage Plan in Cooperative Sector, launched as a Pilot Project on May 31, 2023, has created substantial storage infrastructure across India's agricultural cooperative network. As of July 2026, the initiative has completed godown construction in 313 Primary Agricultural Credit Societies (PACS), creating more than 1.80 Lakh Metric Tons (LMT) of storage capacity. The plan currently encompasses 1,012 identified PACS or cooperative societies nationwide.
Integrated Approach Through Scheme Convergence
The plan operates through convergence of multiple government schemes: Agriculture Infrastructure Fund (AIF) provides financing and interest subvention support; Agricultural Marketing Infrastructure (AMI) scheme offers back-ended capital subsidy with enhanced rate increased from 25% to 33.33%; Sub Mission on Agricultural Mechanization (SMAM) facilitates Custom Hiring Centres; and Pradhan Mantri Formalisation of Micro Food Processing Enterprises (PMFME) promotes processing units. This integrated approach allows PACS to evolve into rural service hubs offering storage capacities of 50 MT, 100 MT, and 200 MT, along with custom hiring services, fair price shops, and primary processing units.
Financial Support and Implementation Framework
The National Cooperative Development Corporation (NCDC) serves as the implementing agency, supported by institutional coordination at national, state, and district levels through Inter-Ministerial Committee, National Level Coordination Committee, State Cooperative Development Committees, and District Cooperative Development Committees. Financial viability measures include reduced margin money requirement from 20% to 10%, revised cost norms for godown construction, and NABARD's special refinance facility. Combined with 3% interest subvention under AIF, PACS access loans at effective interest rate of 1%. Food Corporation of India provides assured hiring of eligible godowns subject to prescribed conditions.
Progress from Pilot to Nationwide Expansion
The initiative began with pilot projects across 11 states—Maharashtra, Uttar Pradesh, Gujarat, Rajasthan, Madhya Pradesh, Uttarakhand, Tamil Nadu, Telangana, Assam, Karnataka, and Tripura—completing 9,750 MT storage capacity in 11 PACS. The Nerpingalai PACS case study in Amravati, Maharashtra demonstrates tangible benefits: a 3,000 MT warehouse storing 32,000 bags of soybeans from 300 farmers, providing ₹4.50 crore advances against stored produce, generating ₹7.68 lakh annual rental income and ₹54 lakh annual interest income for the society.
Quality Standards and Operational Framework
The plan mandates WDRA-compliant storage structures using durable, corrosion-resistant materials with proper ventilation systems. Uniform branding guidelines with specific logos and color schemes create recognizable identity. Regular inspections, quality audits, and Project Management Consultant monitoring ensure compliance with design specifications and safety standards. PACS selection requires own land (not waterlogged or forest areas) or leased land with minimum 20-year lease period, approved by District Cooperative Development Committees based on storage demand areas.
Context and Significance
The initiative addresses India's growing agricultural production, with 2025-26 foodgrain production estimated at 376.563 million tonnes (5.3% higher than previous year's 357.732 million tonnes), and supports the National Food Security Act covering 80 crore people. By reducing transportation costs between procurement centers, minimizing foodgrain wastage, providing farmers flexibility to avoid distress sales, and strengthening rural cooperative institutions, the plan enhances food security while creating local employment opportunities.