Nabard aims to refinance Rs 17,000cr in FY08

Rural credit development bank Nabard has set a refinance target of Rs 17,000 crore to institutions for rural credit during the current fiscal, compared to Rs 14,000 crore in 2006-07.

"The refinance target for this year is in the range of Rs 16,000-17,000 crore with major focus on crop loans," K G Karmakar, managing director, Nabard told PTI.

To meet its refinancing provisions, Nabard has already raised Rs 1,200 crore through borrowings from the market at 10% interest, recently. "Going forward, we anticipate that borrowing cost is likely to go up."

In such a scenario, the rural credit institution would require some kind of assistance from the government, he added.

Talking about the break-up of refinance, Karmakar said, bulk of refinancing done by the bank last year went to non-farm sectors like tractor loans and SHGs, constituting 65% of total refinance, while remaining 35% was for agriculture.

This year, Nabard plans to go to the market for raising around Rs 23,000 crore. The development finance institution has seen growths of 53%, 32% and 4%, respectively, in its production credit refinance, loans to state governments and investment credit refinance to reach Rs 14,758 crore, Rs 20,005 crore and Rs 34,748 crore as on March 31.