Tamil Nadu launches subsidy scheme for 100 agriculture value-addition centres

CHENNAI: The Tamil Nadu government on Wednesday notified a new scheme to support entrepreneurs and companies establishing value-addition and processing units for agricultural produce, as announced in the Agriculture Budget 2025–26.

The scheme aims to set up 100 value-addition centres across the State in line with the Chief Minister Stalin's target of making Tamil Nadu a $1 trillion economy by 2030.

The Agriculture and Farmers' Welfare Minister, MRK Panneerselvam, said the initiative is designed to strengthen secondary industries in the farming sector.

Under the scheme, a 25 per cent investment subsidy will be provided for new projects up to Rs 10 crore. Women entrepreneurs, enterprises from backward areas (as per the MSME department schedule), and those promoted by Scheduled Castes and Scheduled Tribes will receive an additional 10 per cent, totalling 35 per cent. The maximum subsidy is capped at Rs 1.5 crore. All beneficiaries are also eligible for a 5 per cent interest subsidy for five years.

Projects should focus on secondary or tertiary processing of crops such as tomato, chilli, turmeric, banana, mango, drumstick, jasmine and millets, producing items including puree, powders, starch, oils, flakes, and snacks. Beneficiaries must contribute at least 5 per cent of the project cost, with the balance funded through bank loans.

Applications, supported by bank-approved project reports, will be evaluated by District Technical Committees and the State Level Project Approval Committee. Subsidy will be released in two instalments—60 per cent initially and 40 per cent later. Beneficiaries of earlier State or Union schemes are also eligible, subject to subsidy limits.