New Delhi, Aug 4 Finance Minister Nirmala Sitharaman informed the Lok Sabha on Monday that NABARD has disbursed a sum of over Rs 1.59 lakh crore as loan assistance to state governments for the creation of rural infrastructure in the last three financial years (2022-23 to 2024-25).
While as much as Rs 1.23 lakh crore of this amount has been disbursed through NABARD’s Rural Infrastructure Development Fund (RIDF) the remaining Rs 36,439 crore has been given under other schemes of the financial institution.
These include NABARD’s Infrastructure Development Assistance (NIDA), Rural Infrastructure Assistance to State Governments (RIAS), Long Term Irrigation Fund (LTIF), Micro Irrigation Fund (MIF), Food Processing Fund (FPF), Warehouse Infrastructure Fund (WIF) and Fisheries and Aquaculture Infrastructure Development Fund (FIDF), the minister said in a written reply.
NABARD’s funding support through these schemes enhances rural infrastructure -- roads, irrigation, and storage facilities -- which lead to increased productivity and better market access in rural areas. This, in turn, improves the ability of rural borrowers to absorb and utilise credit effectively, the minister explained.
NABARD also provides short-term and long-term refinance to Cooperative Banks and Regional Rural Banks (RRBs) for agricultural loans at concessional rates. As per the findings of NABARD All-India Rural Financial Inclusion Survey (NAFIS) 2021-22, the proportion of agricultural households availing credit from institutional sources increased from 60 per cent in 2016-17 to 75 per cent in 2021-22, FM Sitharaman pointed out.
She also highlighted that NABARD has promoted the formation of 6215 Farmer Producer Organisations (FPOs) till date under various schemes. The major support provided to FPOs includes formation of FPOs, capacity building, credit facilitation and market linkage support, financial literacy, etc.
In addition, NABARD in partnership with Small Farmers’ Agri-Business Consortium (SFAC) and Open Network for Digital Commerce (ONDC) has conducted FPO Melas at 50 locations across 24 states and UTs to enable the marketing & branding of FPO products.
She further stated that the government has taken various steps to promote accessibility of credit to farmers which inter-alia include, increase in limit of collateral free loans under the Kisan Credit Card (KCC) Scheme to Rs 2 lakh from Rs 1.6 lakh, inclusion of allied sectors such as animal husbandry and fisheries under KCC scheme, Interest Subvention (IS) and Prompt Repayment Incentive (PRI) under the Modified Interest Subvention scheme (MISS) which ensure loans up to Rs 3 lakh at an effective interest rate of 4 per cent.
Besides, in the Union Budget 2025-26, the Government has enhanced the loan limit under the MISS from Rs. 3 lakh to Rs. 5 lakh for loans taken through the KCC, the Finance Minister added.
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