Nabard in talks with corporates for rural push

The National Bank for Agricultural and Rural Development (Nabard) is attempting to tap top corporates to further its mandate of rural development.

The bank is in talks with corporates like the Tata group, ITC, Mahindra & Mahindra, Reliance Industries and Hindustan Lever Ltd for mutual collaboration in rural areas.

Nabard plans to supplement its rural development efforts by working with corporates while they operate in rural markets both for commercial purposes and also as part of their social responsibility.

Nabard chairman Ranjana Kumar said discussions with the Tata group are at an advanced stage and a memorandum of understanding is expected to be signed in the next six weeks.

She declined to give details of the nature of the collaboration before the terms are finalised. Nabard plans to work with tobacco-to-hotels major ITC in Madhya Pradesh and Rajasthan.

The collaboration with corporates would involve the use of Nabard's expertise in social infrastructure projects and the marketing strengths of rural financial institutions associated with it in fulfilling the mandate of ensuring integrated rural development.

Nabard is also tapping top public sector companies such as Oil and Natural Gas Corporation (ONGC), Bharat Petroleum Corporation, Hindustan Petroleum Corporation, National Thermal Power Corporation and Rashtriya Chemicals and Fertilisers.

Nabard wants to extend its expertise to these public sector companies in implementing projects under their corporate social responsibility initiatives.

Ranjana Kumar said the flow of credit to agriculture in 2004-05 will be Rs 1,08,500 crore against the indicative target of Rs 1,05,000 crore and about 28 per cent higher than in 2003-04.

The credit linking of self-help groups (SHGs) has been scaled up with 3.47 lakh new SHGs being linked to banks against the target of 1.85 lakh.

The number of SHGs credit linked with banks has increased to 14.26 lakh in March 2005 from 10.79 lakh in March 2004. About 90 per cent of the SHGs linked were exclusive women SHGs.

Nabard provided aggregate refinance of Rs 1,006 crore in 2004-05 for support extended to 2,16,051 SHGs, against Rs 705.44 crore in 2003-04.