Nabard to spend Rs 5000 cr warehousing fund by March

Mumbai: After sanctioning Rs 2,000 crore for warehousing development projects in this fiscal so far, National Bank for Agriculture and Rural Development (Nabard) is confident of achieving the budget target of clearing proposals worth Rs 5,000-crore by March. The Rs 5,000-crore investment is expected to create an additional grain storage capacity of 15 million tonnes. [caption id=“attachment_1369051” align=“alignleft” width=“380”]  Building warehouse. AFP[/caption] “We have sanctioned loans of over Rs 2,000 crore during the past two months alone and are confident of sanctioning the remaining Rs 3,000 crore by March to exhaust the budget allocation of Rs 5,000 crore,” Nabard chairman Harsh Kumar Bhanwala told reporters in Mumbai on Thursday. Finance Minister P Chidambaram had announced Rs 5,000 crore per year towards warehousing for the past two fiscals, to be taken out of the Rural Infrastructure Development Fund. Last fiscal, the entire amount lapsed as Nabard could not sanction any proposal. Bhanwala said that around Rs 1,000 crore will be passed on to private companies or public-private partnerships. “We lend to the state government entities engaged in warehousing creation at 6.5-7.5 percent interest, while PPPs and private sector get the loan at a little over 10 percent,” he said, adding that loan has a principal moratorium for the first two years and repayment period of 7-12 years. He emphasised that 10 percent interest rate for private entities is very competitive as it is almost on par with commercial banks’ base rates. It is estimated that agriculture sector needs additional foodgrain storage capacity of 180 million tonnes, as the annual production is over 260 million tonnes and current storage capacity is 100 million tonnes, Bhanwala said. Meanwhile, on the overall Rural Infrastructure Development Fund allocation of Rs 20,000 crore for the fiscal, Bhanwala said Nabard has already sanctioned 96 percent of the money for multiple projects in the irrigation, social, rural roads and bridges, and employment projects. At its internal project sanctioning committee meeting earlier this week, it cleared projects worth over Rs 6,000 crore, he said. PTI