The Union Cabinet on Wednesday approved the PM-Vidyalaxmi scheme that makes students who get admission in Quality Higher Education Institutions (QHEIs) eligible for a collateral-free and guarantor-free education loan. An outlay of Rs 3,600 crore has been made for the scheme for 2024-25 to 2030-31 period and around 7 lakh fresh students are expected to benefit from the interest subvention offered under the scheme. Students will be provided a 75% credit guarantee by the central government for loans up to Rs 7.5 lakh. Students, with an annual family income of up to Rs 8 lakh, who are ineligible for benefits under any other government scholarship or interest subvention schemes, will be provided 3% interest subvention for loan up to Rs 10 lakh during the moratorium period. “The interest subvention support will be given to 1 lakh students every year. Preference will be given to students who are from government institutions and have opted for technical and professional courses,” the government statement said. This is in addition to an existing scheme — the Central Sector Interest Subsidy (CSIS) that provides full interest subvention on loans up to Rs 10 lakh to students with an annual family income of up to Rs 4.5 lakh, pursuing technical or professional courses. In a post on X, Prime Minister Narendra Modi called the Cabinet decision “a big boost to making education more accessible.” “The Cabinet has approved the PM-Vidyalaxmi scheme to support youngsters with quality education. It is a significant step towards empowering the Yuva Shakti and building a brighter future for our nation,” he wrote. Quality higher education institutions (QHEIs) will be determined by NIRF rankings. The scheme will be applicable to all institutions, including government and private, in the top 100 in overall and in other domain-specific rankings, state government institutions ranked 101 to 200, and all Centre-run institutions. Students in 860 higher education institutions will be eligible, and the list will be updated based on NIRF rankings each year. An official of the Ministry of Education said that with this, students enrolled in all courses, not just technical or professional ones, will be eligible under the scheme. Students can apply for a loan and interest subvention on a portal ‘PM-Vidyalaxmi’. Equity infusion in FCI In a separate decision, the Cabinet Committee on Economic Affairs (CCEA), chaired by Prime Minister Narendra Modi, approved infusion of equity of `10,700 crore for working capital in FY 2024-25 in Food Corporation of India (FCI). “The decision is aimed at bolstering the agricultural sector and ensuring the welfare of farmers nationwide,” said an official statement issued after the Cabinet meeting. “FCI started its journey in 1964 with an authorised capital of `100 crore and equity of `4 crore. The operations of FCI increased manifolds resulting in an increase of authorised capital from `11,000 crore to `21,000 crore in February 2023. The equity of FCI was `4,496 crore in Financial Year 2019-20, which increased to `10,157 crore in the Financial Year 2023-24. Now, the Government of India has approved a significant amount of equity of `10,700 crore for FCI which will strengthen it financially and will give a big boost to the initiatives taken for its transformation,” the statement said. “The infusion of equity is a significant step towards enhancing the operational capabilities of FCI in fulfilling its mandate effectively. FCI resorts to short term borrowings to match the gap of fund requirement. This infusion will help to lower the interest burden and will ultimately reduce the subsidy of the Government of India,” it said. In a post on X, the PM said: “Today’s Cabinet decision on the infusion of equity of `10,700 crore in the Food Corporation of India will enhance its capacity to manage food procurement and distribution efficiently. It will also ensure better support for farmers and contribute to national food security.”
