National Bank For Agriculture And Rural Developemt (NABARD) Flashcards
Q. How does NABARD act as a backbone of the rural economy ?
Ans : 1. Promotion and Development : Rural infrastructure development fund (RIDF) and other livelihood interventions like watershed development fund and tribal development fund .
2. Refinancing : In the last 42 years, NABARD has refinanced Rs 20 lakh crore in the rural economy .
3. Strengthening Rural Financial Institutions (RRIs) : RCBs and RRBs.
Q. What are some issues in the current institutional rural credit system ?
Ans : 1. Regional imbalance : In 2020-21 southern region had the largest share (45.9%) , followed by northern region (17.1%) but the eastern region hardly accounted for 9.5% of agriculture credit disbursed.
2. Disparity based on landholding : medium and large farmers, who are just 14% of total farmers, get 48% of the agricultural credit.
3. Gender disparity in credit distribution : as per world bank findex data, only 5% of Indian women accessed bank credit .
4. Bureaucratic hurdles and red tapism : credit institutions generally adopt cumbersome rules and formalities for advancing loans to farmers.
Q. What are some initiatives taken by govt to increase credit penetration in rural areas ?
Ans : 1. Lead Bank Scheme.
2. Provision of Priority Sector lending.
3. Self-help group-bak linkage programme.
4. Kisan Credit Card (KCC) scheme.
5. Pradhan Mantri Jan Dhan Yojana (PMJDY).
Q. What are some recommendations/way forwards for NABARD ?
Ans : 1. Land lease markets : State govts should reform their legal framework based on the Model Land Leasing Act proposed by NITI Aayog.
* Computerization of land records can help.
2. Addressing regional disparity .
3. Credit Guarantee scheme : on the lines of credit guarantee fund trust for micro and small enterprises.
4. Overall rural development : infrastructure creation, leveraging digital technology, digital payment system etc .
