Rajya Sabha on Tuesday passed a bill to increase authorised capital of Nabard by six time to Rs 30,000 crore and enable exit of RBI after the government assured that there is no plan to have private holding in it.
The National Bank for Agriculture and Rural Development (Amendment) Bill, 2017, was passed in the Rajya Sabha, months after it was passed by the Lok Sabha in August, 2017. In his reply on the bill in the Rajya Sabha, Minister of State for Finance Shiv Pratap Shukla said, “Some members asked about private holding in Nabard. There is no proposal to have private holding in the Nabard”.
On apprehensions about RBI’s role as regulator of Nabard after passage of this bill, the minister said, “RBI is the regulator for the Nabard and it would continue to be so.” The minister told the house that the bill was supported by almost all members of the House from all parties, including Congress’ Rajeev Shukla and Ananda Bhaskar Rapolu, Shiv Sena’s Anil Desai and BJP’s Vikas Mahatme.
All of these members urged the government that the poor farmers at the bottom should be able to reap benefits of the finance aid provided by the Nabard. At present the authorised capital of Nabard is Rs 5,000 crore and there is a proposal to increase it to Rs 30,000 crore.
If there is a need to increase this authorised capital above Rs 30,000 crore, then after discussions with RBI it can be increased up to Rs 50,000 crore, Shukla said. As RBI is also a regulator, its 0.4 percent equity will be transferred to the Centre and as a result, 100 percent equity will come to the government.
The bill also seeks to amend certain clauses in the light of reference of the Micro, Small and Medium Enterprises (MSMEs) Development Act, 2006 in the proposed legislation. Participating in the discussion, SP Neeraj Shekhar supported the bill but said Nabard should ensure that loans are provided to small and marginal farmers as well as MSMEs and not to big corporates/ farmers.