‘NABARD is active in implementing Atmanirbhar Bharat schemes … the silver lining has been agriculture’s performance’
Agriculture emerged as a key focus area in the government’s stimulus package announced in May. As a force multiplier, the government last month unveiled a new central sector scheme to direct credit of Rs 1 lakh crore to bolster infrastructure for the post-harvest phase. National Bank for Agriculture and Rural Development (NABARD) is to be a key channel in directing money to the rural economy. The institution’s chairman Govinda Rajulu Chintala gave Samdani MN an overview of its role:
Has the agricultural sector’s performance been affected by the Covid-19 crisis?
The silver lining even in these times has been the superior performance of the agriculture sector owing to the good rabi harvest and monsoon. Foodgrain production has touched 295.67 million tonnes with record growth over the past four years [2016-19]. Further, CRISIL projects agricultural growth at 2.5% for 2020-21. It is the right time to boost the food processing sector at MSME and food parks’ level and we are doing our best.
What is the role of NABARD in reviving India’s economy?
Let me first point out that the Indian economy is showing great resilience and based on some latest macro indicators, is expected to quickly bounce back. NABARD on its part is playing an active role by stepping up the availability of timely refinance to banks, providing financial assistance to state governments and corporations for the creation of the much needed rural infrastructure sector and providing loans to various state-owned corporations for their procurement operations.
NABARD has also provided a special liquidity facility (SLF) to RRBs, cooperative banks, and NBFC-MFIs during the pandemic period to enable them to carry out their operations in an unhindered manner. These measures have ensured unhindered credit flow to the farmers for carrying out their agricultural operations. We have also accelerated our developmental efforts involving several stakeholders like farmer producer organisations (FPOs), primary agricultural credit societies (PACS), NGOs etc.
Do you think that there is a need to infuse more funds into the government schemes?
The central government has been very proactive in ensuring the continued flow of funds for various economic activities. Various programmes announced recently by the central government like Animal Husbandry Infrastructure Development Fund with a total corpus of Rs 15,000 crore, Agriculture Infrastructure Fund of Rs 1 lakh crore and proposal to form 10,000 FPOs across the country are expected to be game changers in terms of how the agriculture ecosystem will be positively impacted in the years to come. NABARD is actively involved in the implementation of these Atmanirbhar Bharat schemes.
Have special plans been readied to extend assistance to the farming sector?
As part of the special dispensation under SLF, we have already extended assistance of Rs 25,000 crore to RRBs, StCBs, and NBFC-MFIs. This is over and above the financial assistance of Rs 1.05 lakh crore for seasonal agricultural operations (SAO), additional SAO etc proposed to RRBs, StCBs and DCCBs, and Rs 90,000 crore by way of long-term refinance to banks for meeting the credit requirement for agriculture and allied activities targeted by us during 2020-21.
For de-stressing the sector, we have extended the repayment moratorium to the needy. NABARD plans to disburse Rs 60,000 crore to boost infrastructure development. Moreover, we have decided to extend concessional refinance at 3% to banks for financing the credit needs of the people in NABARD-supported watershed development and tribal development project areas. Concessional refinance at 3% will also be provided to PACS to enable these ground-level cooperative institutions to offer multiple services to rural entrepreneurs.
What’s the repayment situation like?
All repayments due from our borrowers during March-June 2020 have been received. In fact, agriculture sector activities are going on without any significant hurdle and efforts are being made to smoothen the marketing and storage issues. Moratorium has been allowed to farmers by our client agencies.
The impact of Covid-19 pandemic pervades across the entire supply chain. In order to support the borrowing entities in this difficult scenario, NABARD has extended relief by way of deferment of principal and interest totalling Rs 47.25 crore to 6 borrowers under Food Processing Fund and Warehouse Infrastructure Fund.
Millions of migrant labourers have returned to native places in rural India. Have you designed schemes to create employment for the migrants?
This is a priority area for NABARD and we are exploring partnerships for skilling the reverse migrants through short duration skill development programmes that will enable the reverse migrants to get employment at the earliest. We are also trying to rope in some credible marketing platform to create a virtual marketplace for rural products.