Softer NABARD loans through corporations soon

“We are still at the discussion stage with major state-run corporations like the MSRDC,State Warehousing Corporation,Maharashtra State Agriculture Marketing Board and Maharashtra State Electricity Distribution Company Ltd . The interest rate will be market linked,but much softer,” he said on Tuesday.

NABARD is looking at corporations as under the Rural Infrastructure Development Fund (RIDF) it can provide only limited money to the state government. Officials said since the state was governed under the Fiscal Responsibility Budgetary Management (FRBM) Act under which it has to take measures to limit fiscal deficit,NABARD is looking at refinancing infrastructure projects through state-run corporations.

Satish said only corporations doing financially well would be provided credit. He said facility of the state government to provide counter-guarantee to the NABARD was also restricted by the FRBM act.

Satish said NABARD plans to provide credit to corporations had come in the backdrop of the promising financial growth in both RIDF projects as well as refinancing sector.

He said during 2010-11,NABARD provided loan assistance of Rs 3,536 crore,a growth of around 29 per cent,in comparison to last year’s loan assistance of Rs 2,753 crore. “Usually,growth remains 20 per cent per annum,but this year was robust for us,” he said.

NABARD General Manager,K Venkateswara Rao said,“NABARD has done well in the RIDF sector and against the sanction of Rs 913 crore in the year 2009-10,total sanction during 2010-11 increased 23 percent to Rs 1,124 crore and an amount of Rs 692 crore was released to the state of Maharashtra.”