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In a bid to reduce farmers’ distress, the National Bank for Agriculture and Rural Development (Nabard) will speed up operationalisation of the Long-Term Irrigation Fund, encourage diversification by farmers into off-farm activities, and focus on rural infrastructure creation, said a top official.
Finance Minister Arun Jaitley, in his Budget speech, had announced that a dedicated Long-Term Irrigation Fund will be created in Nabard with an initial corpus of about ₹20,000 crore.
Bonds issueHK Bhanwala, Chairman, Nabard, said in FY17, his institution will raise about ₹55,000-60,000 crore, against the normal ₹45,000-50,000 crore mopped up by issuing bonds every year.
Nabard chief said Jaitley, who addressed the development finance institution’s board meeting on Friday in New Delhi, emphasised that irrigation is the most critical element for reducing farmers’ distress.
In this context, he wants the irrigation fund to be operationalised soon so that major, medium and minor irrigation projects can be financed out of it.
Out of 141 million hectares of net cultivated area in the country, only 46 per cent is covered under irrigation.
Further for mitigating distress, the Minister said farmers need to diversify into off-farm activities. In this regard, dairy and food processing sectors offer good opportunity. Small and marginal farmers can take advantage of dairy income significantly.
The Minister said there should be focus on rural infrastructure to revive demand. Besides irrigation, the state governments, through the rural infrastructure development fund mechanism, should also encourage activities in agriculture and related sector (such as soil conservation, godown, plantation and horticulture), social sector (drinking water, toilets, and public health institutions) and rural connectivity (rural roads and bridges).
Credit deliveryBhanwala said his institution has suggested to the authorities that there should be focussed attention on credit delivery in Eastern, North-Eastern and Central India. “There should be a mechanism for creating demand for credit in these areas. For that we need to work with local institutions there, be it Panchayati Raj institutions or any other institution,” he said.
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