NABARD crosses Rs 50,000 crore lending in a year for infra boost
National Bank for Agriculture and Rural Development (NABARD), India’s apex development financial institution, would give a push to agri and rural start-ups in the country with a view to generate employment opportunities in the rural areas.
Delivering the Foundation Day Seminar inaugural address, Anurag Singh Thakur, Minister of State, Finance highlighted the need to attract youth to agriculture and build a technology-driven ecosystem for agri-entrepreneurship and called for concerted efforts to create a large base of agricultural start-ups. He inaugurated the Seminar titled ‘Engaging Rural Youth Gainfully’ organised on the occasion of 38th Foundation day of NABARD. On the occasion, the Minister felicitated 5 agri business start-ups funded by NABARD and also released a book profiling 9 such personalities.
“India needs to create agripreneurs for which skilling and tech-enabled services are crucial. Agri-based e-commerce platforms, farm monitoring, linking with fintech will help make youths become agripreneurs. While the Government is supporting the sector significantly, the public-private partnership is essential for boosting the agriculture start-up culture in India, which could be a new engine for employment,” said Anurag Singh Thakur.
Dr Harsh Kumar Bhanwala, Chairman, NABARD revealed that the bank would fund around 100 agricultural and rural start-ups during current financial year which would boost innovations and farm entrepreneurship. He said that NABARD would infuse around Rs 1000 crore into agri and rural start-ups ecosystem. He said that a separate subsidiary company NABVENTURES floated by NABARD will help achieve this.
NABARD has presently supported 16 Alternative Investment Funds (AIFs) with Rs 272 crore to finance over 50 agri enterprises. The newly launched NABVENTURES, to finance new start up enterprises, has already launched its first fund with a targeted corpus of Rs 500 crore with green shoe option of Rs 200 crore. The first closure of the fund is over with an investment of Rs 200 crore from NABARD. It will focus on investments in early mid stage startups in agriculture, agri tech, food and rural businesses.
Asset Size to cross Rs 5 Lakh Crore
NABARD Chairman also told on the side lines of the Seminar that the bank is looking to cross the mark of Rs 5 lakh crore asset size in the financial year 2019-20. The Bank’s balance sheet stood at Rs 4.87 lakh crore at the end of financial year 2018-19 with net profit of Rs. 3,365 crore. It is also expecting to borrow around Rs 55000 crore for its long term funding requirements during the year.
Rural Infrastructure Push
NABARD has been putting a big thrust in overhauling the rural and agricultural infrastructure by supplementing the initiatives of the Centre and State Governments with loan assistance. Programmes like Rural Infrastructure Development Fund (RIDF), NABARD Infrastructure Development Assistance (NIDA), Long Term Irrigation Fund (LTIF), Warehouse Infrastructure Fund (WIF), Food Processing Fund (FPF) together would result in disbursement of over 50,000 crore for building roads, bridges, dams, warehouses, food processing units, etc. NIDA, a separate window opened by NABARD for infrastructure funding in rural areas, has disbursed around Rs 2500 crore during 2018-19 and has a book size of Rs 9125 crore at present. The bank is aiming to push this window of finance in the future with a view to ensure speedy completion of various infrastructure projects in rural areas for early accrual of benefits.
Collectivisation and Market Linkages
NABARD has already supported promotion of around 4200 farmer producer organisations (FPOs) that act as a means of collectivisation of farmers for achieving collective bargaining power to small and marginal farmers in procuring inputs, carrying out agricultural operations and marketing agricultural produce. NABARD has been supporting FPOs through funding for their promotion and handholding, training to CEOs and other office bearers, helping in book keeping, etc. NABARD also has plans to support State level Resource Agencies to be set up for spearheading FPOs movement in each State. The Budget announcement of formation of 10,000 FPOs will help boost this movement. The bank is also supporting promotion of producer organisations in off-farm sector. 25 such OFPOs have been promoted so far.