‘NABARD to launch ₹1,000-cr blended fund for agri-startups’

The aim is to boost tech-driven startups and rural enterprises, said chairman Shaji

The National Bank for Agriculture and Rural Development (NABARD) will launch a ₹1,000-crore fund to bolster technology-driven agri-startups and rural enterprises, said chairman Shaji K.V. on Monday. The fund will back startups facing challenges in scaling up their operations due to limited access to equity and debt instruments, and will seek to foster new linkages in the rural ecosystem, both forward and backward.

“The problem is not the availability of money. About ₹22 trillion is going just for production credit. We are not sure if it is being used for production. Another ₹22 trillion needs to go for investment credit. The solution must focus on when farmers get the money, have the adequate skill to use that money for other production activities, such as processing, and get trained for it,” he said at the Startup Mahakumbh event.

According to Shaji, the startups should be aware of the necessary technology or machinery required, and this will necessitate numerous activities. “This is where many startups can operate, and we are trying to incubate such startups. We have already set up a ₹750-crore fund, which will be followed by another ₹1,000 crore.”

“Thee ₹1,000 crore may not be sufficient, but as a starter, it will be good. Most importantly, for pre-seed investments, we are setting up another ₹750 crore to support new ideas, which have not been tested, or where scalability is not ensured.

But we need to support those ideas to welcome solutions.”

While the government has been doing a lot in terms of agri-infra fund scheme, animal husbandry infrastructure development fund, and food processing fund, etc., the money is going to traditional farmers or existing players, he said. “We need to fund new players who are coming up with new technologies. Almost 8% of our balance sheet is now for production credit. We need to re-orient that towards more investment credit. This is what we will be doing.”

In the budget for 2022-23, Nirmala Sitharaman had announced plans for a blended capital fund, to be raised through co-investments, and facilitated by NABARD.

The startups should be aware of the necessary technology or machinery required, and this will necessitate numerous activities