Nabard sanctions Rs 42 cr to state warehousing corporation

The National Bank for Agriculture and Rural Development (Nabard) has sanctioned a credit of Rs 42.12 crore to Karnataka State Warehousing Corporation (KSWC) for construction of foodgrain storage capacity of 131,000 tonnes, Nabard said in a statement.

The loan is sanctioned under the Nabard Infrastructure Development Assistance (NIDA) fund, a longer tenure product. Under this scheme, Nabard extends loan for a period of nine years with a moratorium of one year at an interest rate of 10 per cent. This is also the first such loan sanctioned under the NIDA scheme across the country, a Nabard official said.

The additional storage capacity to be created is proposed to be utilised by the Food Corporation of India (FCI) under PEGS 2008 and will immensely help the farmers for better price realisation. For the first time in the country, Nabard, Karnataka Regional Office has released the first installment of Rs 11 crore under NIDA to KSWC for construction of warehouses in 10 districts across the state.

While releasing the amount to KSWC, S N A Jinnah, Chief General Manager, Nabard Karnataka Regional Office said, “The special line of credit set up by Nabard would help in providing customised financial support to the state owned institutions and also other entities in Public Private Partnership mode”.

The assistance under NIDA is provided on flexible terms for longer tenure and outside RIDF borrowings to the state government and other state owned organisations through direct financing, he said.

The NIDA fund was launched last year with a focus on providing direct funding support for development of infrastructure facilities for promotion of agriculture and rural development.

Nabard is also in talks with electricity supply companies in Karnataka to extend a long-term financial assistance of Rs 500 crore.