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NABARD (National Bank for Agriculture and Rural Development) 🌾

"The RBI of Rural India"

Established: July 12, 1982. Committee: B. Sivaraman Committee (CRAFICARD). Headquarters: Mumbai. Ownership: 100% by Government of India.

Objective: To promote sustainable and equitable agriculture and rural development through participative financial and non-financial interventions.

Why NABARD? 🤔

Before 1982, RBI handled rural credit. But RBI was too busy with monetary policy and commercial banks. Rural India needed a specialized apex bank. So, NABARD was born to focus ONLY on rural development.

Functions of NABARD 🛠️

1. Credit Functions (Refinance) 💰

NABARD does not lend directly to farmers. It provides refinance (loans to banks who lend to farmers).

  • Short-Term Credit: For seasonal agricultural operations (crops).
  • Medium/Long-Term Credit: For investment in agriculture (tractors, irrigation, land development).
  • Eligible Institutions: State Co-operative Banks, RRBs, Commercial Banks.

Flow of Funds: NABARD ➡️ Co-operative Banks/RRBs ➡️ Farmers.

2. Developmental Functions 🌱

  • Institutional Development: Strengthening Co-operative banks and RRBs.
  • Research & Development: Funding research in agriculture.
  • SHG-Bank Linkage: Promoting Self Help Groups (SHGs) for microfinance.
  • Kisan Credit Card (KCC): Designing and promoting KCC scheme.

3. Supervisory Functions 👮

  • Inspects RRBs and Co-operative Banks.
  • Ensures they follow banking rules and use funds correctly.

4. RIDF (Rural Infrastructure Development Fund) 🏗️

  • Managed by NABARD.
  • Provides low-cost loans to State Governments for rural infrastructure (roads, bridges, irrigation projects).

Role in Rural Development 🚜

  1. Credit Planning: Prepares "Potential Linked Credit Plan" for every district.
  2. Climate Change: Acts as National Implementing Entity for climate change projects.
  3. Financial Inclusion: Supports financial literacy camps in villages.
  4. Tribal Development: Wadi projects for tribal livelihoods.

Quiz Time! 🎯

Test Your Knowledge

Question 1 of 5

1. NABARD was established in:

1947
1969
1982
1991

💡 Final Wisdom: "NABARD is the silent engine powering India's rural economy - from the tractor in the field to the road connecting the village!" 🚜🛣️

Next up: SIDBI - The champion of Small Industries! 🏭

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