Agriculture Value-Addition Centres Scheme
A 25% investment subsidy — 35% for women and SC/ST entrepreneurs — to set up 100 agro-processing and value-addition centres across the state, capped at ₹1.5 crore per project.
Run by: Department of Agricultural Marketing & Agri Business, Government of Tamil Nadu
- Base subsidy
- 25% of project cost
- Women / SC-ST enterprises
- 35% of project cost
- Maximum subsidy
- ₹1.5 crore per project
- Project cost ceiling
- Up to ₹10 crore
- Target centres
- 100 across Tamil Nadu
Overview
Tamil Nadu notified this scheme in the 2025-26 Agriculture Budget to fix a gap that costs farmers money every harvest: produce that leaves the field with no cleaning, grading or processing sells for whatever the first buyer offers. The scheme funds 100 value-addition centres — hubs that do cleaning, grading, sorting, primary processing, packaging and cold storage close to where the crop is grown — for entrepreneurs and companies willing to set one up.
The subsidy is a straight 25% of project cost for a new project up to ₹10 crore. Women entrepreneurs, units in backward areas notified by the MSME department, and enterprises promoted by Scheduled Castes or Scheduled Tribes get an extra 10 percentage points, taking their subsidy to 35%. Either way the payout is capped at ₹1.5 crore per project, and a five-year interest subvention of 5% on the bank loan portion is available on top of the capital subsidy.
The scheme is targeted at crops where post-harvest loss and price volatility hurt the most: tomato, chilli, turmeric, banana, mango, drumstick, jasmine and millets. A promoter puts in at least 5% of the project cost themselves, finances the rest through a bank loan backed by an approved project report, and the subsidy is released in two instalments — 60% after the unit is set up, the remaining 40% after verification.
The 100-centre target is set within the state government's stated aim of a $1-trillion Tamil Nadu economy by 2030, and is meant to build up the secondary, processing side of farming rather than just move raw produce faster.
What you get
The benefit as the state notifies it — nothing here is an estimate.
- 25% capital subsidy on a new value-addition or agro-processing project costing up to ₹10 crore.
- 35% subsidy for women entrepreneurs, units in notified backward areas, and SC/ST-promoted enterprises.
- Subsidy capped at ₹1.5 crore per project, released in two instalments as the unit is verified.
- A 5% interest subvention on the bank-loan portion of the project, for five years.
- Covers cleaning, grading, sorting, primary processing, packaging and cold-storage infrastructure — not just machinery.
Who is eligible
State schemes usually state their criteria as prose rather than a checklist. This is that prose, unpacked — the department’s verification is what decides.
You qualify if
- Individual entrepreneur, FPO or company setting up a new value-addition or processing unit in Tamil Nadu
- Project focused on crops such as tomato, chilli, turmeric, banana, mango, drumstick, jasmine or millets
- Promoter contributes at least 5% of the project cost; balance financed through a bank loan
- A bank-approved detailed project report submitted for appraisal
Not covered
- Projects costing more than ₹10 crore (subsidy applies only up to the ceiling)
- Units already fully commissioned before sanction, or claiming subsidy retrospectively
- Projects without a bank-approved project report or without the promoter's own minimum contribution
Documents you need
Have these ready before you start — most rejections are a missing paper, not a missing right.
- Detailed project report, bank-appraised
- Aadhaar and PAN of the promoter or authorising documents for a company/FPO
- Proof of land or premises for the proposed centre
- Bank loan sanction letter
- Caste certificate where claiming the SC/ST enhanced subsidy rate
How to apply
Fewer steps than a central scheme, and usually one office rather than a portal.
- 1
Prepare a bank-appraised project report
Work out the project cost and financing with your bank, since the subsidy and the loan sanction both depend on an approved detailed project report.
- 2
Apply through the Department of Agricultural Marketing & Agri Business
Submit the application with the project report to the district office; it goes to the District Technical Committee and then the State Level Project Approval Committee for sanction.
- 3
Set up the unit, get it verified, receive the subsidy
On sanction, build the centre and start operations. 60% of the subsidy is released after commissioning, and the remaining 40% after the department verifies the unit is running.
If something goes wrong
Missing from the list, or payment stuck — here is the channel the department itself publishes for it.
- For an application stuck at the District Technical Committee or the State Level Project Approval Committee, or a subsidy instalment not released after verification, follow up with the district office of the Department of Agricultural Marketing & Agri Business and the department helpline 044-22253884, then the Director of Agricultural Marketing & Agri Business at Chennai.
- Beyond the department, use the Tamil Nadu CM Helpline (Mudhalvarin Mugavari) — toll-free 1100 (7am–10pm), the portal at cmhelpline.tnega.org, the "CMHelpline Citizen" app, or email [email protected]. Keep your Aadhaar or family card number and the complaint reference.
Frequently asked questions
Is this the same as the Micro Irrigation Subsidy or Uzhavar Pathukappu Thittam?
No. This scheme funds agro-processing and value-addition infrastructure — cleaning, grading, packaging, cold storage. Micro Irrigation Subsidy is for drip and sprinkler systems, and Uzhavar Pathukappu Thittam is accident and disability insurance for farmers. All three are separate Tamil Nadu schemes.
What is the maximum subsidy I can get?
25% of project cost for a general applicant, or 35% for a woman entrepreneur, a unit in a notified backward area, or an SC/ST-promoted enterprise — capped at ₹1.5 crore per project either way.
Do I get the full subsidy at once?
No. It comes in two instalments — 60% once the centre is set up, and the remaining 40% after the department verifies it is functioning.
Can an FPO apply, or only a company?
An individual entrepreneur, a Farmer Producer Organisation or a company can all apply, as long as it is a new value-addition or processing unit with a bank-appraised project report and the promoter's own 5% contribution.
Is the interest subvention automatic with the capital subsidy?
It is a separate benefit on the bank-loan portion — 5% for five years — claimed alongside the capital subsidy, not instead of it.
What if my project costs more than ₹10 crore?
You can still build it, but the subsidy is worked out only on cost up to ₹10 crore and is capped at ₹1.5 crore regardless.
Facts checked against www.agrimark.tn.gov.in on 8 September 2026. editorial policy.