NABARD, NaBFID team up on rural infrastructure financing

By Puja Sharma

The National Bank for Financing Infrastructure and Development (“Institution”) and the National Bank for Agriculture and Rural Development (“NABARD”) have signed a Memorandum of Understanding (MoU) to facilitate joint financing opportunities for rural infrastructure projects across India.

The collaboration seeks to leverage NABARD’s extensive rural presence alongside the Institution’s infrastructure financing capabilities to create scalable financing solutions for rural infrastructure projects. Through this MoU, the two organisations will explore co-lending and consortium lending structures to enable long-term financing for rural infrastructure projects.

Areas of cooperation include Public Private Partnership (PPP) projects and agri-value chains, along with infrastructure carrying strong rural linkages including water and sanitation, irrigation, post-harvest storage and cold-chain facilities, terminal markets, rural roads and bridges, warehousing and compressed biogas.

The collaboration also includes advisory support covering project structuring, financial modelling and debt syndication, alongside joint capacity-building initiatives drawing on the training institutions of both organisations.

Dr Shaji Krishnan V., Chairman, NABARD, said: “Rural infrastructure itself has both social and  commercial dimension. Our role has been to fund financially sustainable, market-based structures, and this partnership lets us work together on value-chain financing, capacity building through our respective training institutions, and on both the liability and asset sides of our business. I am confident that this collaboration can help bridge the rural-urban divide and advance rural prosperity, which remains an important national priority. This MoU is a good starting point, and we look forward to working together towards that larger goal.”

Mr Rajkiran Rai G., Managing Director, National Bank for Financing Infrastructure and Development said, “This collaboration is a significant step towards strengthening rural infrastructure by aligning our infrastructure financing capabilities with NABARD’s deep understanding of rural development needs. Our objective is to facilitate a greater flow of patient capital into rural infrastructure sectors that are vital for economic growth and inclusive social development.”