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Introduction On Nabard: National Bank For Agriculture and Rural Development (Nabard)
Introduction On Nabard: National Bank For Agriculture and Rural Development (Nabard)
CHAPTER 1
INTRODUCTION ON NABARD
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INTRODUCTION
National Bank for Agriculture and Rural Development (NABARD) is an apex
development bank in India based in Mumbai, Maharashtra. It was established on
12 July 1982 and it completed its 25 years on 12 July 2007. It was established by a
special act by the parliament and its main focus was to uplift rural INDIA by
increasing the credit flow for elevation of agriculture and rural non farm sector. It
has been accredited with "matters concerning policy, planning and operations in
the field of credit for agriculture and other economic activities in rural areas in
India".
NABARD was established on the recommendations of Shivaraman Committee, by
an act of Parliament on 12 July 1982 to implement the National Bank for
Agriculture and Rural Development Act 1981. It replaced the Agricultural Credit
Department (ACD) and Rural Planning and Credit Cell (RPCC) of Reserve Bank
of India, and Agricultural Refinance and Development Corporation (ARDC). It is
one of the premiere agencies to provide credit in rural areas.
International associates of NABARD ranges from World Bank-affiliated
organizations to global developmental agencies working in the field of agriculture
and rural development. These organizations help NABARD by advising and giving
monetary aid for the upliftment of the people in the rural areas and optimizing the
agricultural process.
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ROLE OF NABARD:
1. serves as an apex financing agency for the institutions providing investment
and production credit for promoting the various developmental activities in
rural areas
2. It takes measures towards institution building for improving absorptive
capacity of the credit delivery system, including monitoring, formulation of
rehabilitation schemes, restructuring of credit institutions, training of
personnel, etc.
3. co-ordinates the rural financing activities of all institutions engaged in
developmental work at the field level and maintains liaison with
Government of India, State Governments, Reserve Bank of India (RBI)
and other national level institutions concerned with policy formulation
4. undertakes monitoring and evaluation of projects refinanced by it.
NABARD's refinance is available to State Co-operative Agriculture and Rural
Development Banks (SCARDBs), State Co-operative Banks (SCBs), Regional
Rural Banks (RRBs), Commercial Banks (CBs) and other financial institutions
approved by RBI. While the ultimate beneficiaries of investment credit can be
individuals, partnership concerns, companies, State-owned corporations or cooperative societies, production credit is generally given to individuals.
NABARD has its head office at Mumbai, India
NABARD operates throughout the country through its 28 Regional Offices and
one Sub-office, located in the capitals of all the states/union territories. Each
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Regional Office[RO] has a Chief General Manager [CGMs] as its head, and the
Head office has several Top executives like the Executive Directors[ED],
Managing Directors[MD], and the Chairperson.It has 336 District Offices across
the country, one Sub-office at Port Blair and one special cell at Srinagar. It also
has 6 training establishments.
NABARD is also
known for its 'SHG Bank Linkage Programme' which encourages India's banks to
lend to self-help groups (SHGs). Because SHGs are composed mainly of poor
women, this has evolved into an important Indian tool for microfinance. As of
March 2006 2.2 million SHGs representing 33 million members had to been linked
to credit through this programme.[6]
NABARD also has a portfolio of Natural Resource Management Programmes
involving diverse fields like Watershed Development, Tribal Development and
Farm Innovation through dedicated funds set up for the purpose.
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CHAPTER 2
RURAL INNOVATION
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RURAL INNOVATION
NABARD's role in rural development in India is phenomenal. National Bank For
Agriculture & Rural Development (NABARD) is set up as an apex Development
Bank by the Government of India with a mandate for facilitating credit flow for
promotion and development of agriculture, cottage and village industries. The
credit flow to agriculture activities sanctioned by NABARD reached Rs 1,574,800
million in 2005-2006. The overall GDP is estimated to grow at 8.4 per cent. The
Indian economy as a whole is poised for higher growth in the coming years. Role
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Recently in 2007-08, NABARD has started a new direct lending facility under
'Umbrella Programme for Natural Resource Management' (UPNRM). Under this
facility financial support for natural resource management activities can be
provided as a loan at reasonable rate of interest. Already 35 projects have been
sanctioned involving loan amount of about Rs 1000 million. The sanctioned
projects include honey collection by tribals in Maharashtra, tussar value chain by a
women producer company ('MASUTA'), eco-tourism in Karnataka[10] etc.[11]
OVERVIEW
NABARD is set up by the Government of India as a development bank with the
mandate of facilitating credit flow for promotion and development of agriculture
and integrated rural development. The mandate also covers supporting all other
allied economic activities in rural areas, promoting sustainable rural development
and ushering in prosperity in the rural areas.
With a capital base of Rs 2,000 crore provided by the Government of India and
Reserve Bank of India , it operates through its head office at Mumbai, 28 regional
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CHAPTER 3
NABARD TODAY
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NABARD TODAY
Initiates measures toward institution-building for improving absorptive capacity
of the credit delivery system, including monitoring, formulation of rehabilitation
schemes, restructuring of credit institutions, training of personnel, etc.
Coordinates the rural financing activities of all the institutions engaged in
developmental work at the field level and maintains liaison with the government of
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India , State governments, the Reserve Bank of India and other national level
institutions concerned with policy formulation
Prepares, on annual basis, rural credit plans for all the districts in the country.
These plans form the base for annual credit plans of all rural financial institutions
Undertakes monitoring and evaluation of projects refinanced by it
Promotes research in the fields of rural banking, agriculture and rural
development
Functions as a regulatory authority, supervising, monitoring and guiding
cooperative banks and regional rural banks
1. ABOUT NABARD
NABARD is set up as an apex Development Bank with a mandate for facilitating
credit flow for promotion and development of agriculture, small-scale industries,
cottage and village industries, handicrafts and other rural crafts. It also has the
mandate to support all other allied economic activities in rural areas, promote
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integrated and sustainable rural development and secure prosperity of rural areas.
In discharging its role as a facilitator for rural prosperity NABARD is entrusted
with
Providing refinance to lending institutions in rural areas
Bringing about or promoting institutional development and
Evaluating, monitoring and inspecting the client banks
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CHAPTER 4
NABARD'S ROLES AND
FUNCTIONS
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CREDIT FUNCTIONS
Credit functions, involving preparation of potential-linked credit plans annually for
all districts of the country for identification of credit potential, monitoring the flow
of ground level rural credit, issuing policy and operational guidelines to rural
financing institutions and providing credit facilities to eligible institutions under
various programmes
NABARD's credit functions cover planning, dispensation and monitoring of credit.
This activity involves:
Framing policy and guidelines for rural financial institutions
Providing credit facilities to issuing organizations
Preparation of potential-linked credit plans annually for all districts for
identification of credit potential
Monitoring the flow of ground level rural credit
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strengthen the cooperative credit structure and the regional rural banks, so that
adequate and timely credit is made available to the needy.
DEVELOPMENTAL FUNCTIONS
Overview
Developmental Initiatives
Credit Planning
Watershed Development Fund
Special Projects
PROMOTIONAL FUNCTIONS
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FUNCTIONS
As an apex bank involved in refinancing credit needs of major financial
institutions in the country engaged in offering financial assistance to agriculture
and rural development operations and programmes, NABARD has been sharing
with the Reserve Bank of India certain supervisory functions in respect of
cooperative banks and Regional Rural Banks (RRBs).
Undertakes inspection of Regional Rural Banks (RRBs) and cooperative banks
(other than urban/primary cooperative banks) under the provisions of Banking
Regulation Act, 1949.
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INSTITUTIONAL BUILDING
Help cooperative banks and RRBs to prepare development actions plans for
themselves
Enter into Moue with state governments and cooperative banks specifying
their respective obligations to improve the affairs of the banks in a stipulated
timeframe
Help RRBs and the sponsor banks to enter into Moue specifying their
respective obligations to improve the affairs of the RRBs in a stipulated
timeframe
Monitor implementation of development action plans of banks and
fulfillment of obligations under Moue.
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information
system,
computerisation
of
operations,
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4. OBJECTIVES
NABARD was established in terms of the Preamble to the Act, "for providing
credit for the promotion of agriculture, small scale industries, cottage and village
industries, handicrafts and other rural crafts and other allied economic activities in
rural areas with a view to promoting IRDP and securing prosperity of rural areas
and for matters connected therewith in incidental thereto".
The main objectives of the NABARD as stated in the statement of objectives while
placing the bill before the LokSabha were categorized as under:
1. The National Bank will be an apex organization in respect of all matters relating
to policy, planning operational aspects in the field of credit for promotion of
Agriculture, Small Scale Industries, Cottage and Village Industries, Handicrafts
and other rural crafts and other allied economic activities in rural areas.
2. The Bank will serve as a refinancing institution for institutional credit such as
long-term, short-term for the promotion of activities in the rural areas.
3. The Bank will also provide direct lending to any institution as may approved by
the Central Government.
4. The Bank will have organic links with the Reserve Bank and maintain a close
link with in.
5. MAJOR ACTIVITIES
1. Preparing of Potential Linked Credit Plans for identification of exploitable
potentials under agriculture and other activities available for development
through bank credit.
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Raj
Institutions
(PRIs)
for
developing
rural
infrastructure.
4. Supporting credit innovations of Non Government Organizations (NGOs)
and other non-formal agencies.
5. Extending formal banking services to the unreached rural poor by evolving a
supplementary credit delivery strategy in a cost effective manner by
promoting Self Help Groups (SHGs)
6. Promoting participatory watershed development for enhancing productivity
and profitability of rainfed agriculture in a sustainable manner.
7. On-site inspection of cooperative banks and Regional Rural Banks (RRBs)
and if-site surveillance over health of cooperatives and RRBs.
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CHAPTER 5
SCHEMES & SUBSIDIARY
Bamboo Farming
MACs
Bio Fuels
Crop Insurance
Agriculture Commodities
SGSY
Farm Mechanization
Land Purchase
Scheme for AgriClinic/ Agri-Business Centres (ACABCs)
SEMFEX
Capacity Building for Adoption of Technology (CAT)
Agri Export Zone (AEZ)
Contract Farming
Farmer's Club
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INVESTMENT CREDIT
NABARD provides refinance under Investment Credit to eligible banks for a wide
spectrum of manufacturing, processing and service sector activities under Rural
Non-Farm Sector. The various refinance schemes of NABARD, inter-alia, cover
the entire manufacturing, processing and approved service activities in the SSI
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sector with emphasis on Cottage, Village, Tiny Industries, Rural Artisans and Rural
Crafts.
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ELIGIBLE INSTITUTIONS
COMMERCIAL BANKS (CBS)
Regional Rural Banks (RRBs)
State Co-operative Banks (SCBs) / District Central Cooperative Banks (DCCBs)
State Co-operative Agriculture and Rural Development Banks (SCARDBs)/
Primary
Co-operative Agriculture
and
Rural
Development
Banks
(PCARDBs)
Scheduled Primary (Urban) Co-operative Banks (PUCBs)
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SUBSIDIARY
NABCONS
NABARD Consultancy Services (Nabcons) is a wholly owned subsidiary
promoted by National Bank for Agriculture and Rural Development
(NABARD) and is engaged in providing consultancy in all spheres of agriculture,
rural development and allied areas. Nabcons leverages on the core competence of
the NABARD in the areas of agricultural and rural development, especially
multidisciplinary projects, banking, institutional development, infrastructure,
training, etc., internalized for more than two decades.
The Company is registered under the Company's Act, 1956, with an authorized
capital of Rs 250 million (US $5.75 million) and paid up capital of Rs 50 million
(US $1.15 million).
In tune with NABARD's mission to bring about rural prosperity, Nabcons has more
than just commercial interest in the assignments it undertakes.
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CHAPTER 6
MICRO CREDIT PROGRAMME
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MICRO CREDIT
Micro Credit has been defined as the provision of thrift, credit and other financial
services and products of very small amount to the poor in rural, semi-urban and
urban areas for enabling them to raise their income levels and improve their living
standards. Micro Credit Institutions are those, which provide these facilities.
2. The Self Help Group (SHG)- Bank Linkage Programme
Despite the vast expansion of the formal credit system in the country, the
dependence of the rural poor on moneylenders continues in many areas, especially
for meeting emergent requirements. Such dependence is pronounced in the case of
marginal farmers, landless labourers, petty traders and rural artisans belonging to
socially and economically backward classes and tribes whose propensity to save is
limited or too small to be mopped up by the banks. For various reasons, credit to
these sections of the population has not been institutionalized. The studies
conducted by NABARD, APRACA and ILO on the informal groups promoted by
nongovernmental organizations (NGOs) brought out that Self-Help Savings and
Credit Groups have the potential to bring together the formal banking structure and
the rural poor for mutual benefit and that their working has been encouraging.
The NABARD accordingly launched a pilot project for the purpose and supported
it by way of refinance. It also provided technical support and guidance to the
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With a view to studying the functioning of SHGs and NGOs for expanding their
activities and deepening their role in the rural sector, in November 1994, RBI
constituted
Working
Group
comprising
eminent
NGO
functionaries,
academicians, consultants and bankers under the Chairmanship of Shri S.K. Kalia,
the then Managing Director, NABARD. As a follow up of the recommendations of
the Working Group, banks were advised in April 1996 as under:
a) SHG Lending as Normal Lending Activity
The SHGs linkage programme would be treated as a normal business activity of
banks. Accordingly, the banks were advised that they may consider lending to
SHGs as part of their mainstream credit operations both at policy and
implementation level. They may include SHG linkage in their corporate
strategy/plan, training curriculum of their officers and staff and implement it as a
regular business activity and monitor and review it periodically.
b) Separate Segment under priority sector
In order to enable the banks to report their SHG lending without difficulty, it was
decided that the banks should report their lending to SHGs and/or to NGOs for onlending to SHGs/members of SHGs/discrete individuals or small groups which are
in the process of forming into SHGs under the new segment, viz. 'Advances to
SHGs' irrespective of the purposes for which the members of SHGs have been
disbursed loans. Lending to SHGs should be included by the banks as part of their
lending to the weaker sections.
c) Inclusion in Service Area Approach
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Banks may identify branches having potential for linkage and provide necessary
support services to such branches and include SHG lending within their Service
Area Plan. Keeping in view the potential reliability, the Service Area Branches may
fix their own programme for lending to SHGs as in the case of other activities
under the priority sector.
With a view to enabling the bank branches to get the benefit of catalytic services of
NGOS, the names of NGOs dealing with the SHGs would be indicated on a blockwise basis in the "Background Paper for Service Area Credit Plans". The Service
Area branch managers may have constant dialogue and rapport with the NGOs and
SHGs of the area for effecting linkage. If a NGO/SHG feels more confident and
assured to deal with a particular branch other than Service Area branch and the
particular branch is willing to finance, such a NGO/SHG may, at its discretion,
deal with a branch other than the Service Area branch. The lending to SHGs by
banks should be included in the LBR reporting system and reviewed, to start with
at SLBC Level. However, it has to be borne in mind that the SHG linkage is a
credit innovation and not a targeted credit programme.
d) Opening of Savings Bank A/c.
The SHGs registered or unregistered which are engaged in promoting savings
habits among their members would be eligible to open savings bank accounts with
banks. These SHGs need not necessarily have already availed of credit facilities
from banks before opening savings bank accounts.
e) Margin and Security Norms
As per operational guidelines of NABARD, SHGs are sanctioned savings linked
loans by banks (varying from a saving to loan ratio of 1:1 to 1:4). Experience
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showed that group dynamics and peer pressure brought in excellent recovery from
members of the SHGS. Banks were advised that the flexibility allowed to the
banks in respect of margin, security norms, etc. under the pilot project would
continue to be operational under the linkage programme even beyond the pilot
phase.
f) Documentation
Keeping in view the nature of lending and status of borrowers, the banks may
prescribe simple documentation for lending to SHGs.
g) Presence of defaulters in SHGs
The defaults by a few members of SHGs and/or their family members to the
financing bank should not ordinarily come in the way of financing SHGs per se by
banks provided the SHG is not in default to it. However, the bank loan may not be
utilized by the SHG for financing a defaulter member to the bank.
h) Training
An important step in the Linkage Programme would be the training of the field
level officials and sensitization of the controlling and other senior officials of the
bank. Considering the need and magnitude of training requirements of bank
officers/staff both at field level and controlling office level, the banks may initiate
suitable steps to internalize the SHGs linkage project and organize exclusive short
duration programmes for the field level functionaries. In addition, suitable
awareness/sensitization programmes may be conducted for their middle level
controlling officers as well as senior officers.
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the Annual Policy Statement for the year 2004-05, it has been announced that, in
view of the need to protect the interests of depositors, microfinance institutions
(MFIs) would not be permitted to accept public deposits unless they comply with
the extant regulatory framework of the Reserve Bank.
4. Interest rates
The interest rate applicable to loans given by banks to micro-credit organizations
or by the micro-credit organizations to Self Help Groups/member beneficiaries
would be left to their discretion.
5. Mainstreaming and enhancing outreach
A Micro Credit Special Cell was set up in RBI to suggest measures for augmenting
flow of micro credit as announced in Governors Monetary and Credit Policy for
the year 1999-2000. In the meantime, a Task Force on Supportive Policy and
Regulatory Framework for Micro Credit was also set up by NABARD. On the
basis of their recommendations, banks were advised to follow the under noted
guidelines for mainstreaming micro credit and enhancing the outreach of micro
credit providers:
I.
The banks may formulate their own model(s) or choose any conduit/
intermediary for extending micro credit. They may choose suitable
branches/pockets/areas where micro credit programmes can be implemented.
It will be useful to start with a selected small area and concentrate fully on
the poor in that area and thereafter with the experience gained replicate the
arrangement in other selected areas. Micro Credit extended by banks to
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The criteria for selection of micro credit organizations are not prescribed. It
may, however, be desirable for banks to deal with micro credit organizations
having proper credentials, track record, system of maintaining accounts and
records with regular audits in place and manpower for closer supervision and
follow-up.
III.
Banks may prescribe their own lending norms keeping in view the ground
realities. They may devise appropriate loan and savings products and the
related terms and conditions including the size of the loan, unit cost, unit
size, maturity period, grace period, margins, etc. The intention is to provide
maximum flexibility in regard to micro lending, keeping in view the
prevalent local conditions and the need for provision of finance to the poor.
Such credit should, therefore, cover not only consumption and production
loans for various farm and non-farm activities of the poor but also include
their other credit needs such as housing and shelter improvements.
IV.
Micro credit should be included in branch credit plan, block credit plan and
state credit plan of each bank. While no target is being prescribed for micro
credit, utmost priority is to be accorded to the micro credit sector in
preparation of these plans. Micro credit should also form an integral part of
the bank's corporate credit plan and should be reviewed at the highest level
on a quarterly basis.
V.
A simple system requiring minimum procedures and documentation is a precondition for augmenting flow of micro credit. Hence, banks should strive to
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6. Delivery Issues
The Reserve Bank constituted four informal groups in October 2002 to examine
various issues concerning micro-finance delivery. On the basis of the
recommendations of the groups and as announced in Paragraph 55 of the
Governors Statement on mid-term Review of the Monetary and Credit Policy for
the year 2003-04, banks have been advised as under:
i.
ii.
The group dynamics of working of the SHGs may be left to themselves and
need neither be regulated nor formal structures imposed or insisted upon.
iii.
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ii.
iii.
These findings were brought to the notice of the banks to enable them to take
necessary corrective action where required.
8. Total Financial Inclusion and Credit Requirement of SHGs
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CHAPTER 7
NABARD'S SUPPORT TO
MICROFINANCE INSTITUTIONS (MFIS)
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basis, grant assistance for partly meeting the salary of field level staff,
infrastructure development and operational deficits during the initial years.
Cumulatively, as at the end of June 2004, Rs 26.98 crore (Rs 269.80 million)
has been sanctioned as RFA to 31 NGO-MFIs and Rs. 0.58 crore (Rs 5.8
million) has been sanctioned as grant to various NGOs. The amount
excludes Rs 3.4 million sanctioned under SHG Post Office linkage
programme in Tamilnadu.
During the year 2003-04, loan support of Rs. 84 million was sanctioned to
two agencies viz. 1) Friends of World Women Banking, India (Rs. 74
million) for on-lending to small NGOs & 2) Kalanjiam Development
Financial Services-a section 25 company promoted by DHAN Foundation
(Rs 10 million) for on lending to SHGs.
NABARD also provides technical support in the form of capacity building of
staff of mFIs and also bankers in appraisal of MFIs for providing wholesale
resource support. Since 2002, training programmes on Appraisal of MFIs" are
being conducted through Bankers Institute of Rural Development (BIRD),
Lucknow. These training programmes are intended to equip the stakeholders to
appreciate the nuances in financing NGO-MFIs and also enhance the flow of
loanable funds from mainstream financial Institutions like banks. Specially
designed capacity building programmes are also being organized for Chief
Executives & other staff of NGOs on promotion as well as managing of self
help groups on a regular basis through our regional offices, in association with
reputed resource NGOs & training establishments.
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CHAPTER 8
GROWTH OF NABARD
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Growth of NABARD
The National Bank for Agriculture and Rural Development (Nabard) has recorded
a 40 per cent growth in agriculture credit and rural development in Karnataka
during 2012-13. It has extended farm credit of Rs 6,053 crore during the year.
While the production credit refinance extended to cooperative banks and regional
rural banks (RRBs) was Rs 3,775 crore, its finance to state government under the
Rural Infrastructure Development Fund (RIDF) was Rs 739 crore. This would
ensure rural connectivity, irrigation and rural social sector investments.
During the year, Nabard introduced Nabard Infras-tructure Development Assistance (NIDA) under which Rs 42 crore was sanctioned to the Karnataka State
Warehousing Corporation (KSWC) for construction of godowns and Rs 244 crore
to Krishna Bhagya Jala Nigam for lift irrigation schemes, he told reporters.
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For the development of Rural Non-Farm Sector, apart from providing refinance
support to the banks, Nabard supported 249 entrepreneurship / skill development
programmes, most of them through RUDSETIs and RSETIs. Rural artisans and
SHG members were supported to participate in 21 marketing events, he said.
With the facilitation of Nabard, Kolar DCCB also qua-lified for licensing by March
2013. Nabard also facilitated installation of core bank-ing solutions in seven
DCCBs with the Apex Bank expected to join the project soon. All cooperative
banks are expected to be CBS-compliant by March, 2014.
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Self-help groups and their bank linkage programme have been able to drive the
idea of financial inclusion into rural hinterlands even in States with poor literacy
record.
If imitation is the best form of flattery, and Nabard would be justifiably proud that
its small pilot on micro-credit should have gone to trigger numberless clones
countrywide, Tenkil said.
He also pointed to one other major transformation in the nature of its interventions
in the rural and agricultural sectors in the country from fight against poverty to
promoting entrepreneurship.
CHALLENGES AHEAD
Nabard was seized of the issues of providing long-term loans to boost investments
in the agricultural sector as also transformation of producer collectives to producer
organisations.
Nirmal Chand, Regional Director, Reserve Bank of India, Thiruvananthapuram,
credited Nabard with success in piloting the core banking solution in cooperatives
sector and driving financial inclusion.
But its capabilities would be tested while seeking to ensure raised level of capital
adequacy in the sector as mandated by the Reserve Bank.
According to Chand, Union Budget 2014-15 sets great store by the Nabards
proven credentials in executing major tasks in enabling the rural and agricultural
sectors.
KB Valsala Kumari, Executive Director, Kudumbashree Mission, and K
Balachandran, General Manager, Canara Bank, and Convenor, State-level Bankers
Committee, also spoke on the occasion.
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CHAPTER 9
NABARD MECHANISATION FOR
FARM CREDIT GROWTH
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The shortage of farm labour in Punjab and Haryana - also known as the food baskets of India has propelled the demand of farm equipments, which in turn could boost credit growth,
according to a paper prepared by the National Bank for Agriculture and Rural Development
(Naba rd).
The paper says there was a credit potential of Rs 3,400 crore for the financial year 2013-14 for
farm mechanisation, an estimated increase of about 20 per cent over the last financial year.
In the area of farm mechanisation, Haryana and Punjab fall among the top states. Initially, farm
mechanisation was a " tractorisation" process, however, the introduction and use of other farm
equipment viz. power tillers, bullock/tractor drawn implements, reapers, threshers, zero-till seed
cum fertiliser drill, raised bed planters, rotavators, etc have also increased significantly over the
year, pushing up credit.
According to the paper, the credit potential for the financial year 2013-14 has been estimated
under farm mechanisation at Rs 1,990.74 crore for Punjab. For Haryana, it is Rs 1,412 crore.
A Nabard official said that with limitation in available labour and increasing wages, medium and
large farmers are looking for labour saving devices to remain competitive. The policymakers and
social scientists are looking for mechanisation to remove drudgery from farm operations so that
the rural educated youth do not run to urban areas in pursuit of jobs, which are already in short
supply. The emerging scenario in the two states manifests the need of modern and efficient farm
equipments customised to the need of the farmers and need to conserve resources.
He further added that keeping in view of the use of the new farm machinery other than tractors,
the replacement demand and increasing off farm use, the scope exists for credit flow under this
important sector. The future policy is expected to focus more on specialized port harvest
equipment and machines which will replace in reducing the crop loss, value addition to
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Also, Farm mechanization has been promoted vigorously by the central and state governments.
Various farm implements have been included in addition to existing implements for financing by
banks which includes Multi-crop thresher, Sadd drill, Rotavator Bed Planter, Tractor Mounted
Sprayer, Potato Digger(Manual and Automatic), caster thresher, Sugarcane cutter, Planter etc.
The state governments provides subsidy on the purchase of the machines by the farmers which
can go upto 50 per cent depending upon the machine.
In order to promote mechanization, Nabard has asked Banks may encourage the proposals for
custom hiring centres/farm machinery banks in their work plan.
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CONCLUSION
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ranges
from
World
Bank-affiliated
organizations
to
global
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BIBLOGRAPHY
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Bibliography
1.
2.
3.
4.
5.
www.nabard.org/nabardfunt/nabardrole&function.asp
www.nabard.org/introdunction.asp
www.nabard.org/nabardglance.asp
www.economictimes.org/nabard
www.timesofindia.com
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