Has NABARD Really Disbursed Over Rs 1.59 Lakh Crore for Rural Infrastructure?
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Synopsis
NABARD has significantly contributed to rural infrastructure by providing over Rs 1.59 lakh crore in loans to state governments. This funding is set to enhance productivity and market access for rural communities, empowering them with better credit support.
Key Takeaways
- NABARD has disbursed over Rs 1.59 lakh crore for rural infrastructure.
- Rs 1.23 lakh crore is through the Rural Infrastructure Development Fund.
- Improved rural infrastructure boosts productivity and market access.
- Credit access for farmers has significantly increased in recent years.
- NABARD supports the formation of Farmer Producer Organisations.
New Delhi, Aug 4 (NationPress) Finance Minister Nirmala Sitharaman revealed in the Lok Sabha on Monday that NABARD has allocated over Rs 1.59 lakh crore in loan support to state governments for developing rural infrastructure during the past three financial years (2022-23 to 2024-25).
Out of this total, approximately Rs 1.23 lakh crore has been distributed via NABARD’s Rural Infrastructure Development Fund (RIDF), while the remaining Rs 36,439 crore has been provided through various other financial programs.
These programs 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), as noted by the minister in her written response.
NABARD’s financial backing through these initiatives significantly boosts rural infrastructure—enhancing roads, irrigation, and storage capabilities—which ultimately leads to heightened productivity and improved market access for rural communities. This, according to the minister, better equips rural borrowers to effectively absorb and utilize credit.
Moreover, NABARD extends both short-term and long-term refinancing options to Cooperative Banks and Regional Rural Banks (RRBs) for agricultural loans at subsidized rates. Citing findings from the NABARD All-India Rural Financial Inclusion Survey (NAFIS) 2021-22, FM Sitharaman highlighted a rise in the percentage of agricultural households accessing credit from institutional sources, increasing from 60 percent in 2016-17 to 75 percent in 2021-22.
She also pointed out that NABARD has facilitated the establishment of 6215 Farmer Producer Organisations (FPOs)
Additionally, NABARD, in collaboration with the Small Farmers’ Agri-Business Consortium (SFAC) and the Open Network for Digital Commerce (ONDC), has organized FPO Melas at 50 locations across 24 states and Union Territories to enhance the marketing and branding of FPO products.
Furthermore, the government has initiated several measures to improve credit accessibility for farmers, which include raising the limit for collateral-free loans under the Kisan Credit Card (KCC) Scheme from Rs 1.6 lakh to Rs 2 lakh, incorporating allied sectors like animal husbandry and fisheries under the KCC scheme, and offering Interest Subvention (IS) and Prompt Repayment Incentive (PRI) under the Modified Interest Subvention scheme (MISS), ensuring loans up to Rs 3 lakh at an effective interest rate of 4 percent.
Additionally, the Union Budget for 2025-26 has raised the loan limit under the MISS from Rs 3 lakh to Rs 5 lakh for loans obtained through the KCC, the Finance Minister concluded.
Point of View
It is essential to recognize the significant strides NABARD is making in rural development. Their commitment to strengthening infrastructure and facilitating credit access is commendable and essential for the growth of our agricultural economy. Such initiatives are crucial for ensuring that rural communities can thrive and contribute to the nation’s overall economic progress.
NationPress
19/08/2025
Frequently Asked Questions
What is NABARD's role in rural infrastructure?
NABARD plays a crucial role by providing financial assistance to state governments for developing rural infrastructure through various funds and schemes, enhancing productivity and market access.
How much has NABARD disbursed for rural development?
NABARD has disbursed over Rs 1.59 lakh crore to states for rural infrastructure development in the last three financial years.
What programs does NABARD offer for farmers?
NABARD offers programs like Kisan Credit Card, various infrastructure development funds, and support for Farmer Producer Organisations to enhance market access.
How has credit access changed for farmers?
The proportion of agricultural households accessing credit from institutional sources increased from 60% in 2016-17 to 75% in 2021-22.
What is the significance of the Kisan Credit Card scheme?
The Kisan Credit Card scheme provides farmers with collateral-free loans, ensuring easier access to credit for agricultural activities.
