Report on

Submitted to: prof. Sumit Gulati

Submitted by: Jitendra Tiwari Sec-A

TABLE OF CONTENT

1. 2. 3. 4. 5.

Introduction Mission Objective Organization Structure Roles & Function

1. Introduction
NABARD is set up as an apex Development Bank with a mandate for facilitating credit flow for promotion and development of agriculture, small-scale industries, cottage and village industries, handicrafts and other rural crafts. It also has the mandate to support all other allied economic activities in rural areas, promote integrated and sustainable rural development and secure prosperity of rural areas. In discharging its role as a facilitator for rural prosperity NABARD is entrusted with

1. Providing refinance to lending institutions in rural areas

2. Bringing about or promoting institutional development and

3. Evaluating, monitoring and inspecting the client banks

Besides this pivotal role, NABARD also:

Acts as a coordinator in the operations of rural credit institutions

Extends assistance to the government, the Reserve Bank of India and other organizations in matters relating to rural development

Offers training and research facilities for banks, cooperatives and organizations working in the field of rural development

 Helps the state governments in reaching their targets of providing assistance to eligible institutions in agriculture and rural development

Acts as regulator for cooperative banks and RRBs Some of the milestones in NABARD's activities are:

Business Operations:

Production Credit: Production Credit (or Crop Loans) to Cooperative Banks and Regional Rural Banks (RRBs) stood at 48,981 crore during 2011-12, registering a growth of 45 per cent over the previous year.

Investment Credit : Investment Credit for capital formation in agriculture & allied sectors, non-farm sector activities and services sector to commercial banks, RRBs and co-operative banks reached a level of 15,421 crore as on 31 March 2012 registering an increase of 14 per cent, over the previous year.

Rural Infrastructure Development Fund (RIDF): Through the Rural Infrastructure Development Fund (RIDF) 14927 crore was disbursed during 2011-12. A cumulative amount of 142470.65 crore has been sanctioned for 462229 projects as on 31 March 2012 covering irrigation, rural roads and bridges, health and education, soil conservation, drinking water schemes, flood protection, forest management etc.

New Business Initiatives:

NABARD Infrastructure Development Assistance (NIDA): NABARD has set up NIDA, a new line of credit support for funding of rural infrastructure projects. The cumulative sanctions under NIDA during the year 2011-12 was 890.85 crore and disbursement was 422.90 crore.

Producers Organisations Development Fund (PODF): In order to support and finance Producers Organiosations, NABARD set up PODF. During the year, 13 projects were sanctioned to Producers

Organisations and 70 projects to PACS, with an assistance of `32.29 crore and 7.75 crore, respectively. The cumulative sanction under the fund was 40.04 crore.

Direct Lending to CCBs: Under Direct lending to CCBs, 937.74 crore was disbursed during the year 2011-12.

PACS as Multi Service Centres : A total of 2,335 PACS have been developed as Multi-service Centres through various interventions from NABARD.

Core Banking Solutions (CBS) : Through Core Banking Solution (CBS), Co-operatives are being brought to a higher technology platform so as to compete with other banks for business and growth.

Development Initiatives:

Watershed Development Fund (WDF): During 2011-12, NABARD provided assistance of 239.99 crore for watershed development covering an area of 5.29 lakh ha, as against 152 crore during 2010-11. The cumulative support stood at 598 crore in respect of 620 projects as on 31 March 2012.

Farm Innovation and Promotion Fund (FIPF): During 2011-12, 41 projects were sanctioned under FIPF in 14 States with financial assistance of 56.53 crore under the Fund. The Fund also supported the pilot testing of the unique mobile-enabled Kisan Credit Project (m-KCC) project.

Farmers Technology Transfer Fund (FTTF): During the year 2011-12, 395 proposals were sanctioned in 29 States with grant assistance of 20.59 crore. The cumulative disbursement as at the end of March 2012 was 44.59 crore.

Farmers Clubs: With the launching of 25,243 new Farmers Clubs during the year, the number of clubs reached 1,01,951 as on 31 March 2012.

 Umbrella Programme on Natural Resource Management (UPNRM): UPNRM aims to boost rural livelihoods by supporting community-managed sustainable natural resource management projects and supported 104 projects in 16 States with disbursements to the tune of 131.89 crore.

Tribal Development Fund (TDF): During the year 2011-12, financial assistance of 290.63 crore was sanctioned for 98 projects benefiting 72,419 tribal families in 16 States. The cumulative sanction as on 31 March 2012 was 1,208.23 crore, covering 3.23 lakh families in 415 projects across 26 States/UTs.

Financial Inclusion Fund (FIF) and the Financial Inclusion Technology Fund (FITF) : As on 31 March 2012, the cumulative sanctions under FIF and FITF were 114.62 crore and 343.48 crore, respectively and disbursements were 36.46 crore and 184.16 crore, respectively.

SHG-Bank Linkage Programme: As on 31 March 2011, there were more than 74.62 lakh savings linked Self Help Groups (SHG) and more than 47.87 lakh credit-linked SHGs covering 9.7 crore poor households under the micro-finance programme. The SHG - Bank Linkage Programme was given a renewed thrust with the launch of SHG-2.

2. Mission
Promoting sustainable and equitable agriculture and rural development through effective credit support, related services, institution building and other innovative initiatives.

In pursuing this mission, NABARD focuses its activities on:

Credit functions, involving preparation of potential-linked credit plans annually for all districts of the country for identification of credit potential, monitoring the flow of ground level rural credit, issuing policy and operational guidelines to rural financing institutions and providing credit facilities to eligible institutions under various programmes. Development functions, concerning reinforcement of the credit functions and making credit more productive

Supervisory functions, ensuring the proper functioning of cooperative banks and regional rural banks

3. Objectives

NABARD was established in terms of the Preamble to the Act, "for providing credit for the promotion of agriculture, small scale industries, cottage and village industries, handicrafts and other rural crafts and other allied economic activities in rural areas with a view to promoting IRDP and securing prosperity of rural areas and for matters connected therewith in incidental thereto".

The main objectives of the NABARD as stated in the statement of objectives while placing the bill before the Lok Sabha were categorized as under : 1. The National Bank will be an apex organisation in respect of all matters relating to policy, planning operational aspects in the field of credit for promotion of Agriculture, Small Scale Industries, Cottage and Village Industries, Handicrafts and other rural crafts and other allied economic activities in rural areas. 2. The Bank will serve as a refinancing institution for institutional credit such as long-term, short-term for the promotion of activities in the rural areas. 3. The Bank will also provide direct lending to any institution as may approved by the Central Government. 4. The Bank will have organic links with the Reserve Bank and maintain a close link with in.

Major Activities

Preparing of Potential Linked Credit Plans for identification of exploitable potentials under agriculture and other activities available for development through bank credit. Refinancing banks for extending loans for investment and production purpose in rural areas.

 Providing loans to State Government/Non Government Organizations (NGOs)/Panchayati Raj Institutions (PRIs) for developing rural infrastructure.

Supporting credit innovations of Non Government Organizations (NGOs) and other non formal agencies.

Extending formal banking services to the unreached rural poor by evolving a supplementary credit delivery strategy in a cost effective manner by promoting Self Help Groups (SHGs)

Promoting participatory watershed development for enhancing productivit y and profitability of rainfed agriculture in a sustainable manner.

4. Organization Structure

5. Functions and Role

Functions
NABARD is an apex institution accredited with all matters concerning policy, planning and operations in the field of credit for agriculture and other economic activities in rural areas.

It is an apex refinancing agency for the institutions providing investment and production credit for promoting the various developmental activities in rural areas

It takes measures towards institution building for improving absorptive capacity of the credit delivery system, including monitoring, formulation of rehabilitation schemes, restructuring of credit institutions, training of personnel, etc.

It co-ordinates the rural financing activities of all the institutions engaged in developmental work at the field level and maintains liaison with Government of India, State Governments, Reserve Bank of India and other national level institutions concerned with policy formulation.

It prepares, on annual basis, rural credit plans for all districts in the country; these plans form the base for annual credit plans of all rural financial institutions

It undertakes monitoring and evaluation of projects refinanced by it.

It promotes research in the fields of rural banking, agriculture and rural development

NABARD and its Role in Training

National Bank Staff College, Lucknow

National Bank Training Centre, Lucknow

Zonal Training Centre, Hyderabad

Bankers Institute of Rural Development (BIRD), Mangalore

Bankers Institute of Rural Development (BIRD), Bolpur

Bankers Institute of Rural Development (BIRD), Lucknow

The provisions of the Act as stated below very clearly indicate the nature and scope of the developmental mandate of the Bank and its role in training and capacity building with the underlying belief that the process of development cannot be accomplished by credit/refinance alone.

Section 38 of the NABARD Act provides that the Bank shall:

maintain expert staff to study all problems relating to agriculture and rural development and be available for consultation to the Central Government, the Reserve Bank, the State Governments and the other institutions engaged in the field of rural development.

 provide facilities for training, for dissemination of information and the promotion of research including the undertaking of studies, researches, techno-economic and other surveys in the field of rural banking, agriculture and rural development.

provide technical, legal, financial, marketing and administrative assistance to any person engaged in agriculture and rural development activities;

may provide consultancy services in the field of agriculture and rural development and other related matters in or outside India, on such terms and against such remuneration, as may be agreed upon;

In this context, the role of training in NABARD and the role played by it for capacity building in client institutions, partner agencies and other developmental agencies is important.

For maintaining 'Expert Staff', the bank needs to provide continuous exposure to its officers and staff for upscaling their knowledge and skills in core areas. However, in the initial years the Bank had recruited expert staff from various technical disciplines and created a separate cadre of officers. These officers were involved in formulating, appraising, monitoring and evaluating different agricultural projects implemented by different credit agencies. These officers, irrespective of their academic background, were imparted similar type of training as all other officers. Their placements and the regular job rotations helped in grooming them to take up assorted assignments, get involved in a variety of roles and functions including credit, developmental, promotional, supervisory and necessary support and information for decision making. The Bank also had access to their specialised skills which were utilised whenever needed.

In pursuance of the Bank's mandate as stated in the Act, the Bank provides training facilities for the RFIs and agencies involved in rural development through BIRD and the two RTCs. With a view to broadbase the training and capacity building efforts, the Bank encourages the RFIs to set up their own training systems and provides these training institutes the necessary support to conduct meaningful and quality training. Options and avenues for strengthening the training interventions at the client level are continuously examined so that the human resources in these institutions are developed to take on the challenges, reckon with the competition, improve customer service, expand outreach, develop suitable products and thereby contribute to rural development.

As NABARD primarily functions through other agencies, the needs of the client institutions largely determine the knowledge and skill requirements of NABARD officers.

NABARD endeavours to blend the experiences of client bank training with the training for NABARD officers so as to make training meaningful and relevant to their roles. Efforts are also made to blend the study findings with the outcome from training to periodically measure the overall impact of the investments made in the training efforts

Role
NABARD is the apex institution in the country which looks after the development of the cottage industry, small industry and village industry, and other rural industries. NABARD also reaches out to allied economies and supports and promotes integrated development. And to help NABARD discharge its duty, it has been given certain roles as follows:
1. Serves as an apex financing agency for the institutions providing investment and production credit for promoting the various developmental activities in rural areas 2. Takes measures towards institution building for improving absorptive capacity of the credit delivery system, including monitoring, formulation of rehabilitation schemes, restructuring of credit institutions, training of personnel, etc. 3. Co-ordinates the rural financing activities of all institutions engaged in developmental work at the field level and maintains liaison with Government of India, State Governments, Reserve Bank of India (RBI) and other national level institutions concerned with policy formulation 4. Undertakes monitoring and evaluation of projects refinanced by it. 5. NABARD refinances the financial institutions which finances the rural sector. 6. The institutions which help the rural economy, NABARD helps develop. 7. NABARD also keeps a check on its client institutes. 8. It regulates the institution which provides financial help to the rural economy. 9. It provides training facilities to the institutions working the field of rural upliftment 10. It regulates the cooperative banks and the RRBs.

NABARD's refinance is available to State Co-operative Agriculture and Rural Development Banks (SCARDBs), State Co-operative Banks (SCBs), Regional Rural Banks (RRBs), Commercial Banks (CBs) and other financial institutions approved by RBI. While the ultimate beneficiaries of investment credit can be individuals, partnership concerns, companies, Stateowned corporations or co-operative societies, production credit is generally given to individuals. NABARD has its head office at Mumbai, India. NABARD operates throughout the country through its 28 Regional Offices and one Sub-office, located in the capitals of all the states/union territories. Each Regional Office[RO] has a Chief

General Manager [CGMs] as its head, and the Head office has several Top executives like the Executive Directors[ED], Managing Directors[MD], and the Chairperson.It has 336 District Offices across the country, one Sub-office at Port Blair and one special cell at Srinagar. It also has 6 training establishments. NABARD is also known for its 'SHG Bank Linkage Programme' which encourages India's banks to lend to self-help groups (SHGs). Because SHGs are composed mainly of poor women, this has evolved into an important Indian tool for microfinance. As of March 2006 2.2 million SHGs representing 33 million members had to been linked to credit through this programme. NABARD also has a portfolio of Natural Resource Management Programmes involving diverse fields like Watershed Development, Tribal Development and Farm Innovation through dedicated funds set up for the purpose.