PM-KUSUM Solar Pump Subsidy: CFA, Components, Apply

How much subsidy do farmers get under PM-KUSUM?

Farmers get a central subsidy of 30% of the benchmark cost or tender cost, whichever is lower, for a standalone solar agriculture pump of up to 7.5 HP under PM-KUSUM Component B, with the state government adding at least 30% - so the farmer pays at most 40%, and bank finance can cover that share so the upfront payment is only about 10%. In the North-East, Jammu & Kashmir, Ladakh, Himachal Pradesh, Uttarakhand and the islands, the central share rises to 50% and the farmer pays at most 20%. These figures come from the MNRE scheme guidelines and the MNRE PM-KUSUM page.

PM-KUSUM is about more than pumps: it also funds small solar power plants on farmland that sell electricity to the DISCOM, and the solarisation of existing grid-connected pumps. This guide explains all three components, who qualifies and how to apply.

TL;DR: PM-KUSUM has three parts. Component A pays farmers to set up 500 kW-2 MW solar plants on their land and sell power to the DISCOM. Component B subsidises standalone solar pumps up to 7.5 HP (30% central + at least 30% state subsidy; farmer pays up to 40%, often via a bank loan with about 10% upfront). Component C pays 30% to solarise grid-connected pumps. Apply through the National Portal or your State Implementing Agency; the scheme timeline now runs to 31 March 2027.

Last verified: 12 November 2026

The three components of PM-KUSUM

Component B: standalone solar pumps (diesel replacement)

Component B is for farmers in off-grid areas where grid supply is not available, to install a standalone solar pump or replace a diesel pump. The subsidy structure per the MNRE guidelines:

• Central financial assistance: 30% of the benchmark cost or tender cost, whichever is lower (50% in the North-East, Sikkim, J&K, Himachal Pradesh, Uttarakhand, Lakshadweep and A&N Islands).
• State subsidy: at least 30%. A state may give more to reduce the farmer's share, but the central CFA stays capped.
• Farmer's share: up to 40% (20% in the special-category states above), which bank finance can cover - the guidelines note the farmer may initially pay only 10% of the cost with the rest as a loan.
• Pumps above 7.5 HP are allowed, but the CFA is limited to what a 7.5 HP pump would receive. In special-category states, CFA is available up to 15 HP for pumps within a 10% installation cap.
• Solar PV capacity is tied to pump size per MNRE specifications - a 3 HP pump cannot have more than 3 kW of panels.
• Projects must be completed within 24 months of sanction by MNRE.

Component C: solarising grid-connected pumps

For pumps already connected to the grid, Component C replaces (or partially offsets) grid and diesel draw with solar. The CFA is 30% (50% in the special-category states) of the solarisation cost - covering solar modules, mounting structure, controller/inverter, balance of system, installation and commissioning, five-year comprehensive maintenance and insurance - on the benchmark cost or tender-discovered cost, whichever is lower.

Key conditions: solar PV capacity can be up to twice the pump capacity in kW for pumps up to 7.5 HP; there is no CFA for replacing an old pump with an energy-efficient one; and where a state offers no subsidy, a farmer can solarise with just the 30% central CFA and fund the rest personally or through a bank loan of up to 70% of the cost.

Component A: earning from a solar plant on your land

Component A lets farmers, groups of farmers, cooperatives, panchayats, FPOs and water user associations set up grid-connected renewable power plants of 500 kW to 2 MW on their land and sell the electricity to the local DISCOM - turning surplus land into a source of annuity income. Where the farmer group cannot arrange equity, the plant can be developed through a developer or the DISCOM acting as the renewable power generator. The National Portal describes the route: install a grid-connected plant on farmland or fallow land and sell electricity to the local DISCOM.

If you are evaluating a plant at this scale, our guides on net metering policy across Indian states, what DISCOMs pay for surplus solar and project financing through IREDA, PFC and SIDBI cover the economics and the paperwork.

How to apply for a PM-KUSUM solar pump

1. Confirm eligibility with your State Implementing Agency (SIA) - usually the agricultural or minor irrigation department, the DISCOM or the state renewable energy agency.
2. Apply through the PM-KUSUM National Portal or your state's portal. Where a state does not provide its 30% share, farmers can still apply on the national route with the 30% central subsidy and fund the remaining 70% themselves or via a bank loan.
3. Sanction, vendor selection and installation follow the SIA's process, with MNRE benchmark costs or tender-discovered costs setting the CFA basis. Installing agencies run bank melas to arrange financing for the farmer's share.

Keep the pump size, land records and bank details ready; the SIA verifies eligibility before sanction, and CFA is released against installation milestones.

Scheme timeline: extension and PM-KUSUM 2.0

The scheme's implementation window, originally till 31 March 2026, has been extended to 31 March 2027 - MNRE's Lok Sabha reply of 29 July 2026 states the timeline is extended till 31.03.2027 for all components, with commissioning extended to 31.03.2027 for projects whose PPAs or national-portal terms were signed or issued by 31 December 2025 (Lok Sabha answer, 29 July 2026). Two more dated changes matter:

• 28 September 2026: MNRE set 30 November 2026 as the last date for achieving financial closure under Components A and C (MNRE office memorandum).
• 28 March 2026: MNRE said PM-KUSUM's committed liabilities will be subsumed under a proposed "PM KUSUM 2.0", which remains at the proposal stage (MNRE office memorandum; Economic Times, March 2026).

Because the successor scheme is still only proposed, confirm the current window and CFA terms with your State Implementing Agency or the National Portal before you buy anything.

Frequently Asked Questions

Who is eligible for a PM-KUSUM solar pump?

Individual farmers are eligible for Component B standalone solar pumps up to 7.5 HP in off-grid areas where grid supply is unavailable, with priority for small and marginal farmers and those using micro-irrigation. Farmers with grid-connected pumps can use Component C to solarise them, and farmers, FPOs, cooperatives and panchayats can set up 500 kW-2 MW plants under Component A.

Is PM-KUSUM a free solar pump scheme?

No. PM-KUSUM subsidises the pump; the farmer still pays. In general states the split is 30% central subsidy, at least 30% state subsidy and up to 40% farmer contribution - though bank finance can cover the farmer's share so the upfront payment is around 10%. In the North-East and hill states, the farmer's share falls to at most 20%.

How much does a solar pump cost under PM-KUSUM?

The subsidy is calculated on the MNRE benchmark cost or the tender-discovered cost, whichever is lower, and MNRE revises benchmark costs from time to time - so the exact price depends on your state, pump capacity and the implementing agency's tender. Ask your State Implementing Agency for the current benchmark cost schedule before comparing vendor quotes.

Can farmers sell solar power to the DISCOM under PM-KUSUM?

Yes, under Component A: farmers and farmer institutions can set up 500 kW-2 MW grid-connected plants on their land and sell the power to the local DISCOM. Under Component C, income from surplus power generated by a solarised pump can also be used toward loan repayment.

What is the difference between PM-KUSUM and PM Surya Ghar?

PM-KUSUM is for agriculture: solar pumps and small power plants on farmland. PM Surya Ghar is for homes: a central subsidy of Rs 30,000/kW for the first 2 kW and Rs 18,000 for the third kW, capped at Rs 78,000, for residential rooftop systems. See our PM Surya Ghar subsidy guide for the residential scheme.

What is the last date to apply under PM-KUSUM?

The implementation timeline runs to 31 March 2027 for all components per MNRE's July 2026 Lok Sabha reply, with financial closure under Components A and C required by 30 November 2026 and commissioning extended to 31 March 2027 for qualifying projects. Because a successor scheme (PM KUSUM 2.0) is still only proposed, confirm current deadlines with your State Implementing Agency or the National Portal before applying.

Does solar farming work alongside crops?

Yes - component A plants are ground-mounted on farmland, and agrivoltaic designs let crops grow under or between panel rows. Our agrivoltaics guide for India covers the dual-use model in detail.