Cabinet clears hike in Nabard’s capital from Rs 5,000 crore to Rs 20,000 crore
9 Feb 2013 5:20 AM IST
The government on Thursday approved enhancing the authorised capital of the National Bank for Agriculture and Rural Development to Rs 20,000 crore, from Rs 5,000 crore and expanding its scope of operations.
The proposal for enhancing the capital base of Nabard to Rs 20,000 crore has been approved by the Cabinet, Information and Broadcasting Minister Manish Tewari said.
The increase in authorised capital in aimed at helping the financial institution expand operations and broaden its activities.
The government also approved the merging the posts of the Chairman and the Managing Director in Nabard.
Following the changes, which would be carried out through amendment to the Nabard Act, 1981, the institution will be able to introduce new credit products, forge new linkages and develop new clients.
Once the changes are made in the Act, Nabard, which is the apex rural and farm development finance body and whose role is to promote credit growth in these areas, would be able to undertake short term lending operations. The amendment proposes to enlarge the meaning of cooperative society to include multi-state cooperative societies registered under any Central law or any other Central or State law relating to cooperative societies.
'The amendments allow Nabard to lend to new institutions, mainly Societies covered under multi-state cooperative societies act and other central laws, producer organisations or such class of financial institutions which are approved by the Central Government,' an official statement said.
This is likely to benefit a larger segment of the financially excluded farmers in the country, it said. It also proposes to increase the scope of operations of Nabard under short term funding purposes and other changes.
The proposal for enhancing the capital base of Nabard to Rs 20,000 crore has been approved by the Cabinet, Information and Broadcasting Minister Manish Tewari said.
The increase in authorised capital in aimed at helping the financial institution expand operations and broaden its activities.
The government also approved the merging the posts of the Chairman and the Managing Director in Nabard.
Following the changes, which would be carried out through amendment to the Nabard Act, 1981, the institution will be able to introduce new credit products, forge new linkages and develop new clients.
Once the changes are made in the Act, Nabard, which is the apex rural and farm development finance body and whose role is to promote credit growth in these areas, would be able to undertake short term lending operations. The amendment proposes to enlarge the meaning of cooperative society to include multi-state cooperative societies registered under any Central law or any other Central or State law relating to cooperative societies.
'The amendments allow Nabard to lend to new institutions, mainly Societies covered under multi-state cooperative societies act and other central laws, producer organisations or such class of financial institutions which are approved by the Central Government,' an official statement said.
This is likely to benefit a larger segment of the financially excluded farmers in the country, it said. It also proposes to increase the scope of operations of Nabard under short term funding purposes and other changes.
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