The Centre remains committed to safeguarding the mandate with which National Bank for Agriculture and Rural Development (Nabard) has been set up.

This clarification has come from Union Minister of State for Finance Namo Narain Meena in a letter to Tapan Sen, Member of Parliament, dated November 5. Nabard has been formed by an Act of Parliament, the Minister recalled.


He wrote to Sen after the latter sought his intervention in the matter of restructuring/repositioning Nabard as per recommendation of Boston Consultancy Group (BCG), a US consultancy firm.

The Minister said that the exercise of repositioning was taken up with a two-pronged strategy. Firstly, it was aimed to improve the scope of existing operations by increasing production and investment credit portfolios.


Their impact would be deepened, apart from raising coverage and volume of releases to State Governments under Rural Infrastructure Development Fund.

Secondly, the strategy aimed at enabling Nabard to quickly respond to evolving needs of the clients by offering customised and innovative products and services.

The minister said that Nabard had reported that all these initiatives are within the mandate of the provisions of Nabard Act, 1981. It was not going to increase interest rates on loans to farmers either, he wrote to Sen.


Meanwhile, All-India Nabard Employees Association (AINBEA) has protested the move to reduce staff strength at a time when the industry is on a recruiting spree.

Recruitment process initiated and written test conducted for 167 Group B employees in 2011 has been cancelled, said Jose T. Abraham, vice-president, AINBEA. During 1990s, the staff strength was more than 5,000 across the country; which has come down to 4,300 as of today.

The management wants to cut this further down to 3,500 or so, Abraham alleged. He also expressed concern that Nabard is downsizing its operations. It has already closed down 17 district offices during 2011-12, of which four are in Kerala, he added.

(This article was published on November 18, 2012)
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