National Bank for Agriculture and Rural Development (Nabard) is targetting agriculture credit around Rs 34 lakh crore this year, said Chairman Shaji Krishnan. In an interview with Christina Titus, he highlighted value-chain financing and directing credit towards underserved regions as key focus areas. Excerpts:
What is the agricultural credit target for FY27?
We are setting a target of around Rs 34 lakh crore this year for agricultural credit. Last year, we have achieved around Rs 32 lakh crore. We will be doing it in a differential manner because there is a lot of regional disparity in agricultural credit. Areas with stronger credit cultures are receiving disproportionately more lending, while regions such as eastern, central and parts of northern India remain under-served despite high agricultural potential. So our focus will be on ensuring that more credit is flowing to these areas and some sort of diversification also we are attempting.
What are the key areas you will be focusing on going forward??
An estimated 25–30% of agricultural produce never reaches consumers due to post-harvest losses. Addressing this requires robust value-chain financing; with a total market size of Rs 32 lakh crore, a 25% increase in such financing is needed to bridge the gap. This needs to be addressed. With surpluses now ample and productivity on the rise, the priority is to manage these surpluses effectively—making value-chain and supply-chain financing critical. The focus is on diversifying into allied activities such as animal husbandry, fisheries and horticulture, which are emerging as key priority areas.
How much are you looking to raise through ECBs under the RBI’s swap facility?
We aim to raise around $2 billion, with discussions underway with the World Bank and multilateral agencies alongside efforts to secure a credit rating to support agricultural insurance initiatives. With the RBI facility, several entities are tapping the market, and we will assess the appropriate pricing.
With three successful issuances this week, are you exploring raising funds through tokenised bonds?
We will look at that. Tokenisation will help to reduce operating costs, improve execution speed and price discovery, and enhance overall efficiency.
What is your assessment of the monsoon so far, and has it had any impact on agricultural activity?
There was a shortfall initially, but the situation is not as deficient now. The storage levels are comfortable and providing enough water to the rabbi season as well. There are certain concerns, but then it is not that alarming.
However, El Nino is expected to strengthen in September or October. Some southern states are experiencing heatwaves, but the monsoon deficit is around 10% and not considered alarming. Overall, the situation remains manageable.