Skip to content

How it works

What NHB actually pays for a mushroom farm

A vendor told a grower NHB pays up to ₹1 crore. This site answered that it was false. On the documents in force, the vendor was closer to right than we were.

A grower was told by a vendor that the National Horticulture Board pays “up to ₹1 crore” on a mushroom project. This site answered that the claim was false, because NHB capped the component at ₹30,00,000. That cap was real, and it was NHB’s own:

Operational Guidelines for Scheme on Development of Commercial Horticulture through Production and Post Harvest Management of Horticulture Crops (NHB Scheme No. 1, the SUPERSEDED operational guideline: the 27-page edition that capped mushroom at Rs 30 lakh)

National Horticulture Board, Ministry of Agriculture & Farmers Welfare, Government of India

No date is printed on this document.

Credit linked back ended subsidy @ 40% of project cost limited to Rs.30.00 lakh per project in general area and @ 50% of project cost limited to Rs. 37.50 lakh for NE and Hilly States for subsidy on the pattern of HMNEH States and scheduled areas.Read the full clause and reasoning
Annexure I, Item A.1 (PDF p.6), "Pattern of Assistance" column, verbatim: "Credit linked back ended subsidy @ 40% of project cost limited to Rs.30.00 lakh per project in general area and @ 50% of project cost limited to Rs. 37.50 lakh for NE and Hilly States for subsidy on the pattern of HMNEH States and scheduled areas." Mushroom reached that rate indirectly: the Eligible Projects clause on page 1 nests "mushroom production units" inside "Commercial production units in open field", which is A.1's own category, and neither appendix carried a mushroom line of its own. READ THE CAPTION ON THIS ANNEXURE. It is headed "COST NORMS AND PATTERN OF ASSISTANCE UNDER MIDH FOR NATIONAL HORTICULTURE BOARD RELATED ACTIVITIES DURING XII PLAN", the XII Plan ran 2012 to 2017. This guideline has since been replaced: NHB's Operational Guidelines, whose Chapter 1 states "The Scheme guidelines shall be effective from 01.01.2025", give the mushroom unit a clause of its own priced per tonne of installed capacity, and NHB's Public Circular of 21 August 2026 then cut the rates. Cited here for one fact only: that the Rs 30 lakh cap still quoted in this market was real, and was NHB's own, until those documents replaced it.

PDF p.6 (Annexure I, Item A.1); Annexure I caption, same page

Read on 14 September 2026 by chirag.

Read the caption on that annexure: it is headed for a plan period that ran 2012 to 2017, and the guideline it sits in has been replaced. On the documents in force today the vendor’s figure is roughly reachable, and a grower who believed us was told their entitlement was about a third of what it is. That was our mistake, not only theirs.

What NHB pays now

NHB’s Operational Guidelines, effective 1 January 2025, give the integrated mushroom unit a clause of its own. It is priced per tonne of installed capacity, and it covers the growing rooms and the compost unit together:

National Horticulture Board Operational Guidelines JANUARY 2025 (NHB Operational Guidelines, January 2025)

National Horticulture Board, Ministry of Agriculture & Farmers Welfare, Government of India (Plot No. 85, Sector-18, Institutional Area, Gurugram 122015)

Printed January 2025

As per NHB norms for a minimum installed capacity above 50 MT and upto 300 MT in controlled conditions @ Rs. 75000/MT without canning and @ Rs. 85000/ MT with Canning including Production Unit + Compost making Unit.Read the full clause and reasoning
Chapter 02, Scheme No. 01, cost norms table, item 1 (vi) (PDF p.17, printed page 7). Item column, verbatim: "Integrated Mushroom Production Unit in project mode". Cost norms column, verbatim: "As per NHB norms for a minimum installed capacity above 50 MT and upto 300 MT in controlled conditions @ Rs. 75000/MT without canning and @ Rs. 85000/ MT with Canning including Production Unit + Compost making Unit." Pattern of assistance column, verbatim: "Credit linked subsidy @ 40% of eligible project cost in General area and @ 50% of eligible project cost for NER and Himalayan States, Scheduled Areas and UTs of Andaman &Nicobar Islands, Lakshadweep Islands, Jammu & Kashmir and Ladakh." Those two percentages were cut to 35% and 45% by NHB's Public Circular of 21 August 2026, cited separately on every rate this record publishes. Read with Chapter 04, Important Instructions, item 16 (PDF p.51, printed page 40), verbatim: "In case of cold storage/CA storage, Mushroom, Ripening chamber, Reefer Van, Cold room and Pre-cooling unit, the EPC is worked out on the basis of capacity." Chapter 01 dates the whole instrument: "The Scheme guidelines shall be effective from 01.01.2025."

PDF p.17 (Chapter 02, item 1(vi)); PDF p.51 (Chapter 04, instruction 16); PDF p.14 (Chapter 01, "Date of Coming into force")

Read on 14 September 2026 by chirag.

The percentages printed there, 40% and 50%, are no longer the ones in force. A Public Circular dated 21 August 2026 revised six components, “Integrated Mushroom Units” among them, with immediate effect:

PUBLIC CIRCULAR No.NHB/CC/Guidelines/2026-27 (NHB Public Circular, 21 August 2026: the amendment that cut the rates)

National Horticulture Board, Ministry of Agriculture & Farmers Welfare, Government of India; signed C.P. Gandhi, Joint Director (Coordination)

Printed 21 August 2026

Item 3, "Revision in Rate of Financial Assistance", verbatim: "The rate of subsidy/financial assistance under various components has been revised." Its table lists six components against two columns headed "General Area" and "NER/Himalayan States, Scheduled Areas and specified…Read the full clause
Item 3, "Revision in Rate of Financial Assistance", verbatim: "The rate of subsidy/financial assistance under various components has been revised." Its table lists six components against two columns headed "General Area" and "NER/Himalayan States, Scheduled Areas and specified UTs*", at 35% and 45% respectively. "Integrated Mushroom Units" is the fourth of the six. The asterisk is defined directly below, verbatim: "As applicable under the respective Scheme Guidelines, including NER and Himalayan States, Scheduled Areas, Andaman & Nicobar Islands, Lakshadweep Islands, Jammu & Kashmir and Ladakh." The item closes, verbatim: "The applicable ceiling of subsidy and other component-specific conditions shall remain as prescribed in the revised Scheme Guidelines." The circular opens by stating its own commencement, verbatim: "following amendments in the Scheme Guidelines shall be applicable with immediate effect".

Page 2 of 4, item 3 and its footnote

Read on 14 September 2026 by chirag.

So the rate is 35% in a general area and 45% in NER and Himalayan States, Scheduled Areas, the Andaman & Nicobar and Lakshadweep Islands, Jammu & Kashmir and Ladakh. Applied to capacity, at the top of the band, that is:

An integrated mushroom unit at 300 tonnes a year, with canning

Subsidy in a general area, at 35%₹89,25,000
Subsidy in an enhanced-rate state, at 45%₹1,14,75,000

Worked out here from the rate below, not a total any single document prints on its own.

PUBLIC CIRCULAR No.NHB/CC/Guidelines/2026-27 (NHB Public Circular, 21 August 2026: the amendment that cut the rates)

National Horticulture Board, Ministry of Agriculture & Farmers Welfare, Government of India; signed C.P. Gandhi, Joint Director (Coordination)

Printed 21 August 2026

Item 3, "Revision in Rate of Financial Assistance", verbatim: "The rate of subsidy/financial assistance under various components has been revised." Its table lists six components against two columns headed "General Area" and "NER/Himalayan States, Scheduled Areas and specified…Read the full clause
Item 3, "Revision in Rate of Financial Assistance", verbatim: "The rate of subsidy/financial assistance under various components has been revised." Its table lists six components against two columns headed "General Area" and "NER/Himalayan States, Scheduled Areas and specified UTs*", at 35% and 45% respectively. "Integrated Mushroom Units" is the fourth of the six. The asterisk is defined directly below, verbatim: "As applicable under the respective Scheme Guidelines, including NER and Himalayan States, Scheduled Areas, Andaman & Nicobar Islands, Lakshadweep Islands, Jammu & Kashmir and Ladakh." The item closes, verbatim: "The applicable ceiling of subsidy and other component-specific conditions shall remain as prescribed in the revised Scheme Guidelines." The circular opens by stating its own commencement, verbatim: "following amendments in the Scheme Guidelines shall be applicable with immediate effect".

Page 2 of 4, item 3 and its footnote

Read on 14 September 2026 by chirag.

The same unit at 300 tonnes, without canning, at ₹75,000 a tonne

General area, at 35%₹78,75,000
Enhanced-rate state, at 45%₹1,01,25,000

Worked out here from the rate below, not a total any single document prints on its own.

National Horticulture Board Operational Guidelines JANUARY 2025 (NHB Operational Guidelines, January 2025)

National Horticulture Board, Ministry of Agriculture & Farmers Welfare, Government of India (Plot No. 85, Sector-18, Institutional Area, Gurugram 122015)

Printed January 2025

As per NHB norms for a minimum installed capacity above 50 MT and upto 300 MT in controlled conditions @ Rs. 75000/MT without canning and @ Rs. 85000/ MT with Canning including Production Unit + Compost making Unit.Read the full clause and reasoning
Chapter 02, Scheme No. 01, cost norms table, item 1 (vi) (PDF p.17, printed page 7). Item column, verbatim: "Integrated Mushroom Production Unit in project mode". Cost norms column, verbatim: "As per NHB norms for a minimum installed capacity above 50 MT and upto 300 MT in controlled conditions @ Rs. 75000/MT without canning and @ Rs. 85000/ MT with Canning including Production Unit + Compost making Unit." Pattern of assistance column, verbatim: "Credit linked subsidy @ 40% of eligible project cost in General area and @ 50% of eligible project cost for NER and Himalayan States, Scheduled Areas and UTs of Andaman &Nicobar Islands, Lakshadweep Islands, Jammu & Kashmir and Ladakh." Those two percentages were cut to 35% and 45% by NHB's Public Circular of 21 August 2026, cited separately on every rate this record publishes. Read with Chapter 04, Important Instructions, item 16 (PDF p.51, printed page 40), verbatim: "In case of cold storage/CA storage, Mushroom, Ripening chamber, Reefer Van, Cold room and Pre-cooling unit, the EPC is worked out on the basis of capacity." Chapter 01 dates the whole instrument: "The Scheme guidelines shall be effective from 01.01.2025."

PDF p.17 (Chapter 02, item 1(vi)); PDF p.51 (Chapter 04, instruction 16); PDF p.14 (Chapter 01, "Date of Coming into force")

Read on 14 September 2026 by chirag.

Neither document defines what canning means, or what a project must install to qualify for the higher norm, so treat the gap between the two as something to settle with NHB against your own drawings.

Why spending more does not buy more

This is the sentence most likely to be missed, because it sits in a general instructions list in a different chapter from the cost norms:

National Horticulture Board Operational Guidelines JANUARY 2025 (NHB Operational Guidelines, January 2025)

National Horticulture Board, Ministry of Agriculture & Farmers Welfare, Government of India (Plot No. 85, Sector-18, Institutional Area, Gurugram 122015)

Printed January 2025

In case of cold storage/CA storage, Mushroom, Ripening chamber, Reefer Van, Cold room and Pre-cooling unit, the EPC is worked out on the basis of capacity.Read the full clause and reasoning
Chapter 02, Scheme No. 01, cost norms table, item 1 (vi) (PDF p.17, printed page 7). Item column, verbatim: "Integrated Mushroom Production Unit in project mode". Cost norms column, verbatim: "As per NHB norms for a minimum installed capacity above 50 MT and upto 300 MT in controlled conditions @ Rs. 75000/MT without canning and @ Rs. 85000/ MT with Canning including Production Unit + Compost making Unit." Pattern of assistance column, verbatim: "Credit linked subsidy @ 40% of eligible project cost in General area and @ 50% of eligible project cost for NER and Himalayan States, Scheduled Areas and UTs of Andaman &Nicobar Islands, Lakshadweep Islands, Jammu & Kashmir and Ladakh." Those two percentages were cut to 35% and 45% by NHB's Public Circular of 21 August 2026, cited separately on every rate this record publishes. Read with Chapter 04, Important Instructions, item 16 (PDF p.51, printed page 40), verbatim: "In case of cold storage/CA storage, Mushroom, Ripening chamber, Reefer Van, Cold room and Pre-cooling unit, the EPC is worked out on the basis of capacity." Chapter 01 dates the whole instrument: "The Scheme guidelines shall be effective from 01.01.2025."

PDF p.17 (Chapter 02, item 1(vi)); PDF p.51 (Chapter 04, instruction 16); PDF p.14 (Chapter 01, "Date of Coming into force")

Read on 14 September 2026 by chirag.

Eligible project cost for a mushroom unit is capacity times the per-tonne norm. Not the invoice. Not the bank’s appraised project cost. Not what the farm cost to build. Two farms at the same capacity draw the same subsidy whether one cost two crore and the other three, and a more expensive build does not move the figure at all.

A 120 tonne unit with canning, general area

Eligible project cost NHB will work with: 120 × ₹85,000₹1,02,00,000
Subsidy, at 35%₹35,70,000
What it changes if the farm actually cost ₹3,00,00,000 to buildNothing

Worked out here from the rate below, not a total any single document prints on its own.

National Horticulture Board Operational Guidelines JANUARY 2025 (NHB Operational Guidelines, January 2025)

National Horticulture Board, Ministry of Agriculture & Farmers Welfare, Government of India (Plot No. 85, Sector-18, Institutional Area, Gurugram 122015)

Printed January 2025

In case of cold storage/CA storage, Mushroom, Ripening chamber, Reefer Van, Cold room and Pre-cooling unit, the EPC is worked out on the basis of capacity.Read the full clause and reasoning
Chapter 02, Scheme No. 01, cost norms table, item 1 (vi) (PDF p.17, printed page 7). Item column, verbatim: "Integrated Mushroom Production Unit in project mode". Cost norms column, verbatim: "As per NHB norms for a minimum installed capacity above 50 MT and upto 300 MT in controlled conditions @ Rs. 75000/MT without canning and @ Rs. 85000/ MT with Canning including Production Unit + Compost making Unit." Pattern of assistance column, verbatim: "Credit linked subsidy @ 40% of eligible project cost in General area and @ 50% of eligible project cost for NER and Himalayan States, Scheduled Areas and UTs of Andaman &Nicobar Islands, Lakshadweep Islands, Jammu & Kashmir and Ladakh." Those two percentages were cut to 35% and 45% by NHB's Public Circular of 21 August 2026, cited separately on every rate this record publishes. Read with Chapter 04, Important Instructions, item 16 (PDF p.51, printed page 40), verbatim: "In case of cold storage/CA storage, Mushroom, Ripening chamber, Reefer Van, Cold room and Pre-cooling unit, the EPC is worked out on the basis of capacity." Chapter 01 dates the whole instrument: "The Scheme guidelines shall be effective from 01.01.2025."

PDF p.17 (Chapter 02, item 1(vi)); PDF p.51 (Chapter 04, instruction 16); PDF p.14 (Chapter 01, "Date of Coming into force")

Read on 14 September 2026 by chirag.

The floor, which is where most small growers stop

The clause reads “a minimum installed capacity above 50 MT and upto 300 MT”. Both ends bind, and they bind differently. Above 300 tonnes the extra capacity is simply not counted, which costs you nothing you had. Below 50 tonnes a year this item pays nothing at all, however much the farm cost. And the word is “above”, not “at least”, so a unit at exactly 50 tonnes does not clear it.

That floor is not a small detail. It is roughly four times the size of a starter farm, and a grower below it should be looking at MIDH, which sets no minimum capacity for a mushroom production unit and carries credit-linkage escapes NHB does not. NHB’s own guideline makes the two mutually exclusive on a single project, so this is a choice between doors, never a stack.

Is there a rupee ceiling? No, and we looked

All 96 pages were read for one. There is none on this item, and that is a finding rather than silence: the same table states a ceiling in terms wherever one exists. “Protected cultivation” and the hi-tech plug nursery each read “maximum subsidy upto 100 Lakh/project”; refrigerated transport reads “Upto max. Rs. 80.00 lakh/project”. The mushroom row’s pattern-of-assistance column is a bare percentage. The word “crore” does not appear in the document at all. The circular then closes the question itself:

“The applicable ceiling of subsidy and other component-specific conditions shall remain as prescribed in the revised Scheme Guidelines.”

The guidelines prescribe none for this component. What limits it is the capacity band.

The conditions that will decide your claim

One member of a family. Ever.

This is new, it is strict, and it reaches further than most applicants expect:

PUBLIC CIRCULAR No.NHB/CC/Guidelines/2026-27 (NHB Public Circular, 21 August 2026: the revised family definition)

National Horticulture Board, Ministry of Agriculture & Farmers Welfare, Government of India; signed C.P. Gandhi, Joint Director (Coordination)

Printed 21 August 2026

Item 1, "Revised Definition of Family and Eligibility", verbatim: "For the purpose of determining eligibility under NHB Schemes, the term “family” shall comprise the applicant's spouse, father, mother, sons and daughters." Its bullets, verbatim: "Only one member of a family…Read the full clause
Item 1, "Revised Definition of Family and Eligibility", verbatim: "For the purpose of determining eligibility under NHB Schemes, the term “family” shall comprise the applicant's spouse, father, mother, sons and daughters." Its bullets, verbatim: "Only one member of a family shall be eligible to avail financial assistance under NHB Schemes, whether individually or through HUF, partnership/proprietorship firm or as a Director of a Company, subject to the applicable provisions."; "Once financial assistance has been availed by any member of an applicant’s family under any NHB Scheme/component, no further financial assistance shall be admissible to any other member of the same family under any NHB Scheme/component, irrespective of any unutilised portion of the maximum admissible ceiling."; "The restriction shall apply across all NHB Schemes/components and shall constitute the final entitlement of the family."; "Where financial assistance has already been availed by an FPO/FPC/Company, its members shall be eligible to avail assistance once in their individual capacity, subject to the revised definition of family."; "Suppression, misrepresentation or furnishing of incorrect information for obtaining financial assistance shall render the applicant liable for recovery of the assistance released along with applicable interest." This REPLACES the narrower definition still printed in the January 2025 guideline itself, whose Chapter 01 reads "The term family shall refer to the husband, wife, and dependent minor children" and allows that "any or all members are eligible to avail benefits under the scheme". Under the circular only one member may.

Page 1 of 4, item 1 (and, for the definition it replaces, guideline PDF p.14)

Read on 14 September 2026 by chirag.

Family here means your spouse, your father, your mother, your sons and your daughters. Once any one of them has availed anything under any NHB scheme or component, no other member gets anything under any NHB scheme or component, and the circular adds “irrespective of any unutilised portion of the maximum admissible ceiling”. So a father who drew a small NHB grant years ago has, on the face of this rule, spent the family’s entitlement. The one relaxation runs the other way: where an FPO, FPC or company has already availed, its members may still avail once in their individual capacity.

Some people may not apply at all

PUBLIC CIRCULAR No.NHB/CC/Guidelines/2026-27 (NHB Public Circular, 21 August 2026: who may not apply at all)

National Horticulture Board, Ministry of Agriculture & Farmers Welfare, Government of India; signed C.P. Gandhi, Joint Director (Coordination)

Printed 21 August 2026

Item 2, "Categories Not Eligible for NHB Assistance", verbatim: "The following categories shall not be eligible for financial assistance under NHB Schemes: 1. Present holders of Constitutional Posts; 2. Present Ministers, Ministers of State, Members of Lok Sabha/Rajya Sabha,…Read the full clause
Item 2, "Categories Not Eligible for NHB Assistance", verbatim: "The following categories shall not be eligible for financial assistance under NHB Schemes: 1. Present holders of Constitutional Posts; 2. Present Ministers, Ministers of State, Members of Lok Sabha/Rajya Sabha, Members of State Legislative Assemblies/Councils, Mayors of Municipal Corporations and Chairpersons of District Panchayats; 3. Serving employees of Central/State Government Ministries/Departments, PSUs, Autonomous Bodies and Local Bodies, except MTS/Class-IV/Group-D employees; 4. Superannuated/retired pensioners receiving monthly pension of ₹10,000/- or more, excluding MTS/Class-IV/Group-D employees; and 5. Group of Farmers." It then provides, verbatim: "Family members of persons falling in the above categories may, however, avail one-time assistance, subject to the applicable provisions of the revised definition of family." The bar on a "Group of Farmers" is reflected in NHB's own reissued eligible-organisations list, which drops "Association/Group of Growers" from the list the January 2025 guideline prints.

Page 2 of 4, item 2

Read on 14 September 2026 by chirag.

Note the fifth item in particular, because it is the one that quietly closes a route a lot of growers were pointed at: a “Group of Farmers” is no longer eligible. Note also the pension threshold, which is low enough to catch a great many retired applicants. Family members of anyone in these categories may still avail one-time assistance, subject to the family rule above.

Build nothing before clearance

NHB now states that commencement of any project works at site before the Grant of Clearance is not permitted and shall lead to rejection of the application. A handful of preliminary works are allowed first out of your own margin money: land levelling and digging of pits, fencing with a gate, a tube well or borewell forming part of the project, applying for power, internal roads and drainage, and other statutory approvals. Everything else waits. The In-Principle Approval, confusingly, is no longer mandatory; it is the clearance that gates construction, not the approval.

So was the vendor right?

About the number, close enough to matter: a 300 tonne unit with canning in an enhanced-rate state rounds to the ₹1 crore that was quoted, and even a general-area project at that capacity is not far below it. What the quote left out is everything that decides whether a particular grower reaches it: the capacity floor, the capacity ceiling, the fact that the figure is driven by capacity rather than by what you spend, the family rule, the term loan NHB requires, and the bar on building before clearance. A figure without its conditions is not an answer.

The superseded guideline is kept on this site in full, rather than deleted, because its ₹30 lakh figure is still in wide circulation and a reader who meets it needs to be able to see exactly what it is and why it no longer governs.

One reading of ours, and everything computed here rests on it

NHB’s clause says “installed capacity” in tonnes and does not define it. Neither the guideline nor the circular defines it anywhere else. This site reads it as annual installed production capacity, which is the reading the numbers themselves support: at ₹75,000 to ₹85,000 a tonne, a unit at the 300 tonne ceiling is priced between ₹2.25 crore and ₹2.55 crore, which is about what a farm producing that much mushroom a year costs to build. On any other reading the norms would not resemble the cost of a real project. It is still a reading, not the document’s own words. Confirm with NHB how your capacity will be assessed before you commit spend against a figure from this page.

Two smaller gaps, stated rather than filled. The documents do not define canning, or say what a project must install to be assessed at the higher norm. And NHB’s technical standards name the Button Mushroom standard for mushroom projects, with conformity mandatory, but neither document says whether a project growing oyster, milky or an exotic species is ineligible or simply has no standard named for it. No species restriction is published here, because none is written down.