NABARD, NaBFID sign MoU to expand long-term funding for rural infrastructure

New Delhi: The National Bank for Agriculture and Rural Development (NABARD) and the National Bank for Financing Infrastructure and Development (NaBFID) have signed a Memorandum of Understanding (MoU) to strengthen financing support for infrastructure projects with significant rural linkages.

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According to an official statement, this partnership will combine NABARD’s expertise in rural and agricultural infrastructure with NaBFID’s capabilities in infrastructure financing. The MoU provides for collaboration in joint financing, knowledge sharing and development of innovative financing solutions aimed at expanding access to long-term and competitively priced finance for rural infrastructure and value-chain projects.

Under the agreement, the two institutions will explore funding arrangements and infrastructure advisory services across the project lifecycle, covering project identification, appraisal and due diligence, credit structuring and pricing, and joint monitoring. They will also collaborate on project structuring, financial modelling and debt syndication.

The partnership will cover Public Private Partnership (PPP) projects, agri-value chains and infrastructure with strong rural linkages. Key areas identified include water and sanitation, irrigation, post-harvest storage and cold-chain facilities, terminal markets, rural roads and bridges, warehousing and compressed biogas.

NABARD and NaBFID will also undertake joint capacity-building initiatives through their respective training institutions to facilitate knowledge exchange and strengthen capabilities in infrastructure financing.

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NABARD Chairman Shaji Krishnan V. said the collaboration could help develop financially sustainable and market-based structures in rural infrastructure and value-chain financing, while contributing to narrowing the rural-urban divide.

While, NaBFID Managing Director Rajkiran Rai G. said the partnership could support the development of commercially viable and bankable projects in areas such as food processing, storage and cold-chain connectivity, with the potential to strengthen farmer incomes and the rural economy.

The collaboration is expected to improve the availability of long-term finance for commercially viable rural infrastructure projects, strengthen connectivity and market access, and support sustainable rural development in line with the broader objective of building resilient infrastructure under the Viksit Bharat vision, the statement further added.

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