What is the core vision and target of NABARD?
NABARD’s mission is to promote sustainable and equitable agriculture and rural prosperity through effective credit support, related services, institution development and other innovative initiatives. It has four functions namely; Supervision of Rural Financial Institutions on behalf of the RBI, Promotion of best practices in agriculture, rural banking & rural development, Refinance to Banks & Funding State Governments for Rural Infrastructure and Policy advocacy.
How much have you achieved since you came into existence?
NABARD is 31 years young! It came into existence on 12 July 1982.We have contributed significantly to the rural economy. Our balance sheet could be a surrogate to reflect what we have achieved. It was Rs.4519 crores in 1982 and it has touched Rs.213,170 crores on 31 March 2013, a growth of about 98%. We gave Nation several innovative products. A few of them are, Self Help Group Bank Linkage program, which has the largest outreach among the micro finance programs, Kisan Credit Card, Joint Liability Groups, Farmer Clubs, Participatory watershed model, Wadi-Orchard based tribal development model, Transformation of primary agricultural societies to multi service societies, Transforming the simple godowns at village level into WDRA [Warehousing Development and Regulation Authority] accredited warehouses which give negotiable ware house receipts & also link them to the commodity exchanges. Rural Infrastructure Development Fund [RIDF] is another powerful initiative which channelizes the shortfall from the priority sector, lending program of the commercial banks to create rural infrastructure. Our cumulative disbursements so far are about Rs. 111,000 crores and our investments are broadly in agriculture, roads & bridges and social sector.
How NABARD is helping the rural poor, especially women and small farmers?
A powerful tool of women empowerment which NABARD perfected is the Self Help Group Bank Linkage program [SHG-BLP]which has the largest outreach among the micro finance programs in the world. When we launched the program in 1992 we had a very modest target of linking 500 SHGs. We now have about 7.4 million savings linked SHGs in the country and SHG-BLP is the template for most of the Govt. programs. Banks have an outstanding amount of Rs.393.75 billions on their books as on 31 March 2013, a great journey from the modest 500 groups!
What are the other Special Programmes initiated to reach the poor farmers in the Rural India?
Indian agriculture is small holder farming. Hence the focus of all our interventions is marginal and small farmers. We have provided about Rs.65000 crores as refinance to Cooperative Banks and Regional Rural Banks during the last financial year. Our refinance is priced at around 4.5% and it enables them to provide crop loans at 7% per annum. We have implemented a large participatory watershed development program covering 19,25,000 hectares with investment of Rs.1075 crores. WADI- is an Orchard based tribal development program where the criterion is presence of small tribal farmers. We have covered 1,92,600 hectares and committed Rs.1,432 crores. We are extremely clear in our minds that these projects need to stand as perfect models, as “beacons of hope” so that the main stream projects of the State Governments learn from them. We have introduced ‘Joint Liability Groups’, an informal group of tenants, oral lessees, small farmers etc, who do not have clear title deeds to their land holdings thus depriving them of credit from banks. JLG ensures them credit linkage like the SHGs to the formal banks. NABARD is helping the RRBs and Cooperatives to issue the Rupay Smart Cards connecting them to their CBS. We have launched an Umbrella Program for Natural Resource Manageent [UPNRM] where credit is given to such natural resource management ventures which are bankable but the banks shy away from them as they are not standard projects like dairy, poultry, minor irrigation etc. We have funded 200 off beat projects under UPNRM. NABARD also organized Rural Innovation Awards.
What are the criteria to provide loans or support to farmers and unskilled poor?
The RBI decides the norms for this. As of now, loans up to Rs.1 lakh to farmers do not require any collateral. The existing crop is hypothecated. Now the crop loan is given through the Kisan Credit Card for which the limit is fixed for 5 years based on the cropping pattern. The KCC has now become a smart card and banks are in the process of upgrading the same. Loans for unskilled poor are given through the SHG-BLP or through the General Credit Card as per norms.
Does NABARD promote agriculture extension models? And why?
The Planning Commission approach papers mention that around 40% of jobs in agricultural extension across the country are not filled. There is no one who advises the farmers! And the farmers turn to the mahajan who gives fertilizers and chemicals on credit. Is this good? Do you go to a physician when you have a trouble with your teeth? NABARD is trying out a novel method, undertaking extension activities by training innovative farmers who can work as para-agricultural extension workers. We tried this in many places. They get social recognition and in addition in some places they get paid for their advice, of course nominally.