Nabard reduces rate of refinance to promote investment in farm sector

Written by PTI | New Delhi | Updated: Jun 10 2014, 16:32pm hrs
The National Bank for Agriculture and Rural Development (Nabard) has reduced the rate of interest by 0.2% on its long-term refinance facility to banks to help promote farm sector investments.

"Rates of refinance will now be 9.5% for five years and above and 9.7% for three to five years period. Banks availing more than R500 crore in a single drawl will further be incentivised by 10 basis points," a finance ministry statement quoting Nabard chairman Harsh Kumar Bhanwala said.

Also, financing for efficient agricultural technologies would get a further incentive of 50 basis points.

About 12 such innovative farm practices to enhance fruit and vegetable production have been listed, including production under controlled conditions like poly houses with watersaving drip and fertigation facilities, precision farming and post-harvest management.

This initiative is aimed at combating food inflation by addressing supply-side constraints.

Nabard will also extend the 50 basis points rebate for supporting single purposes under area development schemes, mainly to benefit small and marginal farmers.