New Delhi: Rural credit development bank Nabard has set a refinance target of Rs17,000 crore to institutions for rural credit during the current fiscal, against Rs14,000 crore in 2006-07.
“The refinance target for this year is in the range of Rs16,000-17,000 crore with major focus on crop loans” Nabard managing director K G Karmakar told PTI.
To meet its refinancing provisions, the rural credit financing institution has already raised Rs1,200 crore through borrowings from the market at 10% recently, he said adding, “going forward we anticipate that borrowing cost is likely to go up.”
In such a scenario the rural credit institution would requires some kind of assistance from the government, he added.
Talking about the break-up of refinance, Karmakar said, bulk of refinancing done by the bank last year has gone in for non-farm sectors like tractor loans and SHGs, constituting 65% of total refinance, while the remaining 35% was for agriculture.
This year, Nabard plans to raise Rs23,000 crore from the market. The institution has seen growths of 53%, 32% and 4% respectively, in its production credit refinance, loans to state governments and investment credit refinance to reach Rs14,758 crore, Rs20,005 crore and Rs34,748 crore as on 31 March.
The bank has registered a growth of 20% in its balance sheet, which touched Rs81,000 crore as on 31 March, against Rs67,705 crore last year.
Despite the growth in the balance sheet, the bank has posted a marginal decline in its operating surplus to Rs1,128 crore during 2006-07 against Rs1,171 crore a year ago.
On implementation of the Vaidyanathan Committee report to revitalise the cooperative sector, Karmakar said, “So far 11 states have signed MoUs and 8-9 more states have expressed interest in signing the agreement.”
Nabard is also a regulator for rural cooperative banks.
Vaidyanathan Committee had recommended a recapitalisation fund of Rs13,596 crore for cooperative banks to rejuvenate agriculture cooperative sector.