Financial, Developmental and Supervision are three broad heads which enable NABARD to touch almost every aspect of rural economy: providing refinance support, building rural infrastructure, preparing district level credit plans, guiding and motivating the banking industry in achieving credit targets, supervising Cooperative Banks and Regional Rural Banks (RRBs), helping them develop sound banking practices, enabling them to on-board to the CBS platform, designing new projects for rural development, implementing GoI's development schemes, training handicraft artisans and providing them a marketing platform for selling their articles among others.
Crop loans are extended to farmers for crop production by financial institutions, which support in ensuring food security in the country. During the year 2019-20, NABARD has disbursed ₹92411 crore for Seasonal Agricultural Operations and ₹7971 for other than seasonal agriculture operations to cooperative banks and RRBs.
NABARD's long-term refinance provides credit to financial institutions for a wide gamut of activities encompassing farm and non-farm activities with tenors of 18 months to more than 5 years. During the year 2019-20, NABARD has disbursed ₹70180 crore to financial institutions.
RIDF was set up with NABARD in 1995-96 by the Reserve Bank of India out of the shortfall in lending to priority sector by scheduled commercial banks for supporting rural infrastructure projects. NABARD disbursed ₹ 26,266 crore during 2019-20. RIDF contributes substantially to the rural infrastructure funding in the country today.
The Long-Term Irrigation Fund (LTIF) was announced in the Union Budget 2016–17 for fast tracking the 99 identified medium and major irrigation projects, spread across 18 states in mission mode by December 2019. Subsequently, GoI has approved the funding arrangement under LTIF up to 31 March 2021 or till the continuation of the scheme is approved, whichever is earlier. Ministry of Water Resources, River Development and Ganga Rejuvenation (MoWR, RD & GR) is the nodal ministry designated to coordinate and facilitate completion of the projects. Subsequently, Government of India has approved funding for four more projects under LTIF viz; Polavaram project in Andhra Pradesh, North Koel project in Bihar and Jharkhand, Relining of Sirhind and Rajasthan Feeder Canal project of Punjab, and Shahpur Kandi Dam in Punjab. Cumulative loans sanctioned and released under LTIF as on 31st March 2020 are ₹81865 crores and ₹44719 crores respectively.
NABARD sanctioned an amount of ₹20,000 crores and released ₹10,811 crores during 2019-20 to the National Rural Infrastructure Development Agency (NRIDA). The cumulative amount sanctioned to NRIDA as on 31 March 2020 was ₹41,975 crore of which ₹28,819 crore was released. The financial assistance was channelized towards PMAY-G, which plans to provide a pucca house, with basic amenities, to all houseless households including those living in kutcha and dilapidated houses, by 2022.
NABARD released an amount of ₹3,600 crores during 2019-20 to the National Centre for Drinking Water, Sanitation and Quality (NCDWS&Q). The cumulative amount sanctioned to NCDWS&Q as on 31 March 2020 was ₹15,000 crore of which ₹12,298 crore was released. The financial assistance was channelized towards SBM-G, aiming at achieving universal sanitation coverage in rural areas by 2nd October 2019
MIF with a corpus of ₹5000 crore has been operationalized in NABARD from 2019-20. The objective of the fund is to facilitate State Govts. in mobilizing additional resources for expanding coverage under micro irrigation and incentivizing its adoption beyond provisions of PMKSY-PDMC. Ministry of Agriculture and Farmers Welfare (MoA&FW), Government of India is the Nodal Ministry. NABARD sanctioned an amount of ₹2842 crore to four States (Andhra Pradesh, Gujarat, Tamil Nadu & Haryana) during 2019-20 under the fund.
NABARD Infrastructure Development Assistance (NIDA) offers flexible long-term loans to well-managed public sector entities for financing rural infrastructure. Projects for agriculture infrastructure, rural connectivity, renewable energy, power transmission, drinking water and sanitation, and other social and commercial infrastructure are financed under NIDA. Inclusion of public–private partnership (PPP) and non-PPP projects to be undertaken by registered entities like corporates/companies, cooperatives, etc. has further broadened NIDA’s scope of funding. Financing under NIDA offers scope for off-budget and on-budget borrowing to state governments and aids in easing state budget constraints.
During the year 2019–20, term loan of ₹ 4382 crore was sanctioned under NIDA through 11 credit proposals. Out of this, irrigation projects accounted for 78% (₹3431 crore) and remaining were to power transmission (₹910 crore) and watershed development (₹41 crore) projects.
Cumulatively, 92 projects with term loan of ₹34,957 crore have been sanctioned. Projects sanctioned under NIDA are in diversified areas catering to various aspects of rural infrastructure (as on 31.3.2020)
• Direct Refinance Assistance to DCCBs for Short-Term Multipurpose Credit (DRA)
While NABARD has been providing refinance to StCBs for various lending purposes, on behalf of District Central Cooperative Banks (DCCBs), direct assistance to DCCBs was designed as an additional line of credit for diversification of lending and enhancing their earnings through profitable portfolios and facilitate effective liquidity management. The credit limit is sanctioned to well-governed and financially strong ‘A’ or ‘B’ rated StCBs or DCCBs, as per the latest inspection report of NABARD, against the unencumbered fixed deposit receipts (FDRs) pledged by the banks or term money borrowing (TMB) or a combination of both FDRs and TMB. The purpose of the loan covers inter alia working capital, repair and maintenance of farm equipment and other productive assets, storage/grading/packaging of produce, marketing activities, non-farm activities, etc. The limit is in the nature of cash-credit operative for one year from the date of sanction. The limit is also available for a period of three months to meet the specific requirements of banks.
During 2019-20, an amount of ₹ 8932 crore was sanctioned under DRA to Cooperative Banks, with disbursement of ₹9200 crore. During the year, 71 banks availed of this facility, out of which 23 were new entities. CAGR of disbursement during last six years was 13.46%.
• Credit Facility to Federations (CFF)
Credit facility to Federations (CFF) provides short-term credit support to state or central government entities like agricultural marketing federations or corporations, dairy cooperatives or federations, agricultural marketing cooperatives or federations, and registered companies for marketing of agricultural commodities, input supply, and value & supply chain management. Under this facility, credit support is made available for procurement of food grains, pulses and oilseeds and other agricultural commodities by marketing federations and civil supply corporations, marketing of fertilizers by federations, and procurement and processing of milk by milk unions/federations. This facility is extended as short-term loan for a period of twelve months OR three months to meet the specific requirements of the agencies.
During the year, eight government corporations/federation, two dairy cooperatives and a marketing cooperative were sanctioned credit limit of ₹ 25,071 crore under CFF for procurement of paddy, wheat, pulses, oilseeds and milk. Eleven entities availed the facility with a total disbursement of ₹ 37,207 crore, recording 25.35% growth over the previous year. CAGR of sanction and disbursement during last six years was 31.96% and 48.48% respectively.
• Dairy Processing and Infrastructure Development Fund (DIDF)
In line with its announcement in the Union Budget 2017–18, Government of India created a Dairy Processing and Infrastructure Development Fund (DIDF) in NABARD, with a total corpus of ₹8,004 crore to be utilised over a period of five years. The objectives of the scheme are modernisation and infrastructure augmentation for milk processing and value addition and to ensure optimum price realisation by the primary producers.
Under DIDF, the National Dairy Development Board (NDDB) / National Cooperative Development Corporation (NCDC) can borrow money from NABARD for on-lending to eligible end borrowers such as cooperative milk unions, state cooperative dairy federations, multi-state milk cooperatives, milk producer companies and NDDB subsidiaries. During the year 2019-20, loan assistance of ₹565 crore was sanctioned for 11 Milk Unions proposals.
Cumulatively, as on 31 March 2020, 33 projects in ten states have been sanctioned to NDDB with loan amount of ₹ 2,722 crore for an investment of ₹ 4059 crore in the dairy processing sector. An amount of ₹ 670 crore was disbursed to NDDB during the year. The sanctioned projects are expected to create milk processing capacity of 119.70 lakh litres per day (LLPD), modernisation of existing plant of 8.35 LLPD, value addition capacity of 2447.52 MTPD/TLPD, and milk drying capacity of 135 metric tonnes per day (MTPD) in implementing states.
• Fisheries and Aquaculture Infrastructure Development Fund (FIDF)
In line with its announcement in the Union Budget 2018-19, Government of India created the Fisheries and Aquaculture Infrastructure Development Fund (FIDF) with a total corpus of ₹7,522.48 crore to be implemented over a period of five years (2018-19 to 2022-23). FIDF guidelines were issued by Department of Animal Husbandry, Dairy, and Fisheries (DADF), Government of India in February 2019. NABARD is acting as a Nodal Loaning Entity (NLE) and will fund the public infrastructure components to the tune of ₹2600 crore through State governments for various investment activities like 18 fishing harbours, 10 fish landing centres, 15 modernized State fish seed farms, 716 fish markets, 72 disease diagnostic laboratories and 5 aquatic quarantine facilities.
During the year 2019-20, 03 fishing harbour proposals were sanctioned to the Government of Tamil Nadu with total financial outlay of ₹420 crore and loan component of ₹348 crore which will generate additional employment to 12115 sea going fishermen and 6000 persons in shore based establishments, distribution and marketing.
• Warehouse Infrastructure Fund
GoI created Warehouse Infrastructure Fund (WIF) in the year 2013- 14 with NABARD with a corpus of ₹5,000 crore for providing loans to meet the requirements for scientific warehousing infrastructure for agricultural commodities in the country. The cumulative disbursement as on 31 March 2020 stood at ₹ 6,712 crores.
• Food Processing Fund
With view to promoting food processing industries in the organised sector on a cluster basis, the Government of India instituted the Food Processing Fund (FPF) in NABARD in 2014–15, with a corpus of ₹2,000 crore. NABARD sanctioned ₹149 crore for setting up of 2 Mega Food Parks, 4 Agro Processing Clusters and 3 individual food processing units during 2019-20 taking the cumulative loan sanctioned to ₹604 crore for 12 Mega Food Park (MFP) projects, 4 Agro Processing Clusters and 6 Food Processing Units as on 31 March 2020. During the year, ₹43 crore was disbursed, taking the cumulative disbursements to ₹356 crore for the sanctioned projects.
B) SUPERVISORY FUNCTIONS
For the FY 2019-20, 332 statutory inspections and 10 voluntary inspections were scheduled with reference to the financial position of banks/ other institutions as on March 31, 2019. The details are as under:-
Inspection budgeted and conducted – 2019-20
No. of Inspections Budgeted
No. of inspections conducted
@ Includes Tamil Nadu Industrial Cooperative Bank Ltd (TAICO Bank)
# Inspections of Nagaland StCB, UP SCARDB, Tripura SCARDB and Daman & Diu StCB could not be conducted.
C) Developmental Functions
• Watershed Development
Cumulatively, as on 31 March 2020, against 3,295-watershed development projects sanctioned covering total project area of 23.05 lakh ha, 1,701 projects have been completed successfully. Grant assistance committed under all programmes stood at ₹2,148 crore, out of which an amount of ₹1805 crore has been disbursed.
• Tribal Development
Tribal Development Fund (TDF) was set up by NABARD in the year 2003-04 with a corpus of ₹50 crore out of its profit. As on 31 March 2020, a total of 791 projects benefitting 5.53 lakh families spread across 4.54 lakh acre area have been sanctioned. Cumulative sanction and disbursement stood at ₹2302 and ₹1655 lakh respectively.
• Climate Change Adaptation Projects
Under Adaptation Fund, the cumulative sanction for six projects and two Readiness Grant stood at USD 9.85 million (₹ 59.53 crore). We have also cumulatively sanctioned 30 projects under NAFCC amounting to ₹ 847 crore at the end of FY 2019-20.
• Umbrella Programme on Natural Resource Management
Cumulatively 334 UPNRM projects have been sanctioned across the country covering 10 major natural resource management sectors with a financial assistance of ₹782 crore including grant assistance of ₹ 44 crore. The cumulative disbursement as on 31 March 2020 stood at ₹576 crore including grant assistance of ₹31 crore.
• Financial Inclusion
As on 31 March 2020 a cumulative amount of ₹4,252 crore was sanctioned and an amount of ₹2,276 crore is disbursed towards various schemes implemented under FIF (Financial Inclusion Fund) by generating demand for banking services and building payment/acceptance infrastructure at the ground level. To bridge the gap between the demand and supply side of FI, a differentiated strategy approach was adopted to address the regional disparities and to bring about inclusive and equitable financial inclusion across the country. This was done by extending grant assistance at enhanced rate of @ 90% in 314 Special Focus Districts which includes aspirational districts, LWE districts and districts in Hilly states and NER.
• Microfinance Sector
NABARD had launched the Self Help Group-Bank Linkage Programme (SHG-BLP) in 1992. It covered about 102.43 lakh Self-Help Groups (SHGs) and nearly 12.4 crore poor households in India as on 31 March 2020. Nearly 31.50 lakh SHGs availed credit support of ₹ 77,659 crore from various banks during 2019-20, at an average of ₹2.47 lakh per SHG. 41.80 lakh JLGs were promoted and financed by banks during 2019–20.
In a bid to digitise SHGs, project EShakti was launched on 15 March 2015 in 02 districts as a pilot. The implementation of the project is currently going on in 254 districts across the country. As on 31 March 2020, data pertaining to 6.54 lakh SHGs involving 72 lakh members in more than 98,000 villages have been on-boarded on the EShakti portal. Further, 19,604 Bank branches are using EShakti portal for informed credit decisions. The credit linkage with banks under EShakti has increased from 2.17 lakh (33%) to 3.21 lakh (50%) as on 31 March 2020, thus proving the success of the project. From January 2020 to March 2020, a special drive was initiated aiming to improve coordination with banks and enhance credit linkage in EShakti. As an outcome of it, loans amounting to ₹249 crore was sanctioned out of which ₹200 crore was disbursed to 13,126 SHGs during this 03 months period.
• Skill Development
In tune with GoI’s goal, NABARD has developed a structured approach for addressing the skill gap in rural India through demand and outcome-based programmes through multiple stakeholders in skill development ecosystem leading to wage/self-employment.
NABARD has so far extended support for training 9.04 Lakh rural youth through 34,878 programmes with grant assistance of ₹154 Crore by gainfully engaging rural youth both in wage as well as self-employment. During 2019-20, NABARD has skilled 33,216 rural youth by supporting 1066 skill development programmes with grant assistance of ₹19 Crore.
During 2019-20, grant support was extended to new channel partners to conduct State/region specific skill development programmes that will lead to employment as well as micro-entrepreneurship. The Skill Development programmes has been gender sensitive in that more than 60 % of the candidates supported were women.
In order to upgrade artisans/weavers/ off farm activity clusters and join them into a formal registered entity as also to support producers take up collective business through capacity building, business planning, market linkages, design development etc, a scheme for formation and nurturing of Off Farm Producer Organisations (OFPOs) was initiated during the year 2016-17. Under this, support is extended to a eligible entity to act as Producer Organisation Promoting Institution to mobilises rural off farm producers for undertaking business collectively so as to enable scale as well as better bargaining power, facilities and opportunities of business.
As on 31 March 2020, 33 OFPOs covering around 11,678 beneficiaries have been supported with grant assistance of ₹13 Crore across 19 states. Of which, 18 OFPOs have been registered under Companies/Societies Act and are undertaking business activities through aggregation, marketing and input distribution . Eight OFPOs are all-women OFPOs and are expected to empower 3325 women weavers/artisans directly.
• Marketing Initiatives
To support rural producers in the farm and off-farm sector to market their produce effectively, NABARD has been extending support for setting up of Rural Haats, Rural Marts and participation of artisans and craftsmen in National/Regional level Exhibitions and Melas.
• Rural Haats
Rural Haats have been vital to the lives of rural communities by providing them accessible market place to buy and sell their farm and off-farm produce. Rural Haats have emerged as an effective marketing link for Producer Organizations, Village Watershed and Tribal Development Committees . NABARD support to Rural Haats is towards infrastructure creation like raised platforms, roofing, drinking water facility , Sanitation etc . During 2019-20, a total of 62 Rural Haats have been sanctioned with a grant support of ₹6 Crore. As on 31 March 2020, 578 Rural Haats have been supported with grant assistance of ₹35 Crore.
• Rural Marts
Rural Marts help to promote entrepreneurship amongst producer communities and provide market link for domestic products manufactured by rural community particularly women and weaker sections. It helps in generating income and employment at grassroot level. During 2019-20, 92 Rural Marts have been sanctioned with a grant support of ₹3 crore. As on 31 March 2020, 930 Rural Marts have been supported with grant assistance of ₹16 Crore.
Exhibitions and Melas provide a direct marketing platform to the artisans with access to market intelligence, customer preferences and bulk orders. Participation in these melas empowers the artisans to face the challenges in doing business.
During 2019-20, 1765 producers/artisans collectives from rural India were supported through exhibitions to display and sell their products in major urban centres, generating direct and bulk sales to the tune of ₹10 Crore. These exhibitions have proved to be an effective marketplace for majority of OFPOs supported by NABARD wherein they could get access to bulk buyers and also gather inputs on improving their products.
During the course of exhibitions, initiatives are taken to empower the participating producers by organizing Buyer-Seller Meets, conducting training programmes and workshops on branding, marketing, packaging, effective communication and entrepreneurship development, promoting financial inclusion and digital payment mechanisms.
• Agri Business Incubation Centres(ABICs)
In order to develop a supportive ecosystem for agri entrepreneurs NABARD started supporting setting up of Agri Business Incubation centre in 2017-18. The policy envisaged extending support to eligible institutions like Agriculture universities /similar institutions(Host Institution) for setting up ABICs and meet the eligible operational expenditure for functioning for a period of five years. It is a step towards promoting more agri startups, Agri /Rural entrepreneurs and enterprises. The institutions so far supported for setting up independent Agri Business Incubation Centres are as given below:
SNo. Name of the Host Institution
1 Tamilnadu Agriculture University, Madurai, Tamilnadu.
2 Chaudhary Charan Singh Haryana Agriculture University, Hisar, Haryana.
3 Indian Institute of Technology, Kharagpur, West Bengal.
4 a-IDEA, National Academy of Agricultural Research Management, Hyderabad, Telangana.
5 Rajmata Vijayraje Scindia Krishi Vishwa Vidyalaya, Gwalior, Madhya Pradesh.
The ABICs supported will nurture start- ups /Agri enterprises/ entrepreurs/Farmers/Farmer Producer Organisations etc working in irrigation, seed production, bio- pesticides, bio fertilizers, precision farming, agro-processing, marketing, bio fuel, drinking water, sanitation, energy, health, education, etc. The ABICs will provide business support services and resources, marketing, finance to agri-startups and agri-entrepreneurs to develop them into viable commercial entities which will result in both direct and indirect benefits accruing to the farmers.
• Setting up of Catalytic Capital Fund
In India, most of the Agri based start-ups face challenges with respect to funding sources. These start-ups which have innovative enterprises and have an early stage technology/ innovative products/ process innovations/ supply chain innovations/ business model innovations struggle to find financial support at the right time.
To support the Agri Start-ups, NABARD has set up “Catalytic Capital Fund for supporting Rural and Agri Start-ups”. The Scheme is to support Startups in the valley of Death stage so that they become viable units.
• Promotion of GI Products
Geographical Indications (GI) is an Intellectual Property right that identifies goods originating from a specific geographical location and having distinct nature, quality and characteristics linked to that location. A GI right allows its holder to prevent its use by a third party whose product does not conform to the applicable standards.
NABARD has supported GI registration of 51 products of which 11 have been registered in Andhra Pradesh, Telangana and Uttar Pradesh. NABARD has facilitated creation of an FPO for marketing of Mattu Gulla Brinjal (GI Product) resulting in increased turnover and direct selling to urban markets. NABARD has also provided financial support for the creation of dedicated product catalogue in three international languages for 10 GI products. A marketing outlet for GI products at Deendayal Hastakala Sankul, Varanasi has also been supported.
• Credit Linked Capital Subsidy Scheme (CLCSS)
NABARD is one of the nodal agencies for implementing the Credit Linked Capital Subsidy Scheme (CLCSS) for Technology Upgradation of Micro & Small Enterprises of Government of India. The Scheme supports the induction of proven and improved technologies into micro and small units in specified products/sub-sectors. NABARD is the nodal agency for application from Rural areas.
• Stand Up India Scheme
Stand Up India Scheme (SUI) launched by Government of India on 5 April 2016 facilitates bank loans ranging from ₹10.00 lakh to ₹1.00 Crore to at least one SC or ST borrower, and at least one women borrower, per bank branch for setting up an enterprise. NABARD continue to be the connect centres for organizing pre and post disbursement handholding events at District level, to share best practices, review of the programmes, problem solving and guiding the potential borrowers. As on 31 March 2020, a total of 2,199 handholding events with 1,01,357 participants have been conducted in 507 districts across the country.