NABARD plans to raise Rs 10,000 crore through infra, green bonds: Chairman KV Shaji

NEW DELHI: The National Bank for Agriculture and Rural Development (NABARD) plans to raise Rs 10,000 crore through a combination of infrastructure and green bonds, according to its chairman K V Shaji. The move aligns with NABARD’s green taxonomy and climate strategy for 2030, focusing on sustainable investments in India’s rural economy.

“We are planning for green bonds, which will be infra plus green bonds. It will be a combination of infrastructure and green initiatives. The new bonds will have an upward duration of over 10 years and… maybe Rs 10,000 crore”, K V Shaji said.

The bonds will have a duration of over 10 years and will support both infrastructure and green initiatives. This follows NABARD’s successful issuance of social impact bonds last year, raising Rs 1,040.50 crore. Last year, NABARD issued India’s ‘AAA’ rated Indian rupee-denominated social bonds, raising Rs 1,040.50 crore at a coupon rate of 7.63 per cent.

#WATCH | Mumbai: Shaji KV (Chairman, National Bank for Agriculture & Rural Development, Mumbai) speaks on NABARD lists social bonds at the Bombay Stock Exchange (BSE) pic.twitter.com/OH7ezkRNgo

— ANI (@ANI) September 29, 2023

Speaking on the sidelines of the launch of AgriSURE Fund, the NABARD chairman said that the all-India financial institution is aiming to support around 80 to 100 agri startups in the next five years through this fund. Union Agriculture and Farmers’ Welfare Minister Shivraj Singh Chouhan launched the AgriSURE Fund and Krishi Nivesh Portal.

The AgriSURE Fund aims to support those start-ups that work towards the development of agriculture-boosting ideas and plans. Through this, the government wants to bring a boost to the agriculture sector. “We are looking at early-stage startups with innovative ideas”, said Shaji. “Our aim is to support around 80 to 100 startups, with a ticket size of Rs 8-10 crore”, he said.

When asked about the priority areas for selecting startups, the NABARD chairman stated that startups focused on climate resilience, organic farming, and agricultural rural enterprises will be prioritized. “The focus will be on adding value to agriculture, reducing post-harvest losses, and ensuring price stability”, said Shaji.

The AgriSURE Fund includes both direct investments and a fund-of-funds model. “We have experience in managing both fund of funds and direct investments. The focus of AgriSURE will be more on impact funding, blending equity with a capital fund approach”, he explained.

When asked about the deadline for funding these startups, Shaji said NABARD plans to meet the target in five years.
“We will try to fast track it because sooner we close this we will be able to launch a second fund also”, Shaji said.

The NABARD chairman asserted that the selection of startups for the AgriSURE Fund will involve a transparent process. “We’ll have an investment committee to evaluate proposals, and we’ll work closely with agricultural universities, state government departments, and other stakeholders to identify the most promising innovations”, Shaji emphasized. “We aim for localized interventions where needed, as the agricultural landscape varies greatly across India,” he added.

Amid the ongoing push for organic farming, the NABARD chairman said that it has also been actively promoting organic farming over the past five to six years, initiating numerous proof of concept (POC) interventions and pilots for climate resilience in agriculture.

“We are now going to launch an area-based climate resilience in agriculture scheme, which will have a broader scope, potentially at the block or district level, moving beyond village-level interventions”, Shaji explained.

NABARD is already piloting around 11 projects involving digitized agri-value chain financing in collaboration with banks, and expects outcomes in the next few months. “If these pilots are successful, we will scale them up to include agri-value chain financing, further strengthening our commitment to sustainable agricultural practices,” added Shaji. (ANI)