In the landscape of agricultural and rural development in India, the full form of “NABARD” stands for “National Bank for Agriculture and Rural Development.” NABARD is a prominent financial institution tasked with the crucial mission of fostering rural prosperity and agricultural growth. Established in 1982, NABARD plays a pivotal role in shaping the rural economy of India. In this comprehensive guide, we will explore the details of NABARD, its functions, and its impact on rural development.

What is NABARD?

National Bank for Agriculture and Rural Development (NABARD) is an apex development bank in India, headquartered in Mumbai, Maharashtra. It was established on July 12, 1982, by an act of parliament to promote sustainable and equitable agriculture and rural development. NABARD operates under the supervision of the Reserve Bank of India (RBI) and the Ministry of Finance.

Objectives of NABARD

NABARD’s primary objectives are:

  • Rural Credit: To provide credit and financial support to farmers, rural entrepreneurs, and agricultural activities.
  • Agricultural Development: To promote sustainable and inclusive agricultural practices, technology adoption, and modernization of agriculture.
  • Rural Infrastructure: To finance rural infrastructure projects such as irrigation, roads, and warehousing to enhance the rural economy.
  • Financial Inclusion: To facilitate financial inclusion by supporting the development of rural credit cooperatives and microfinance institutions.
  • Institutional Development: To strengthen and support rural financial institutions, including regional rural banks (RRBs) and cooperative banks.
  • Policy Advocacy: To act as a think tank and policy advocate for rural development and agriculture-related issues.

Functions of NABARD

NABARD performs various functions to achieve its objectives:

  • Credit Refinancing: NABARD refinances banks and financial institutions that provide credit to farmers and rural entrepreneurs.
  • Rural Infrastructure Development: It finances projects related to rural infrastructure development, including roads, bridges, and irrigation systems.
  • Promotion of Self-Help Groups: NABARD promotes self-help groups (SHGs) and provides them with financial support and capacity-building assistance.
  • Research and Development: It conducts research and development activities to improve agricultural practices and rural livelihoods.
  • Training and Capacity Building: NABARD offers training programs to bankers, farmers, and rural development professionals to enhance their skills and knowledge.
  • Monitoring and Evaluation: It monitors and evaluates the progress and impact of various rural development programs and initiatives.

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Impact of NABARD

NABARD has made a significant impact on rural development in India:

Improved Agriculture:
It has contributed to modernizing Indian agriculture, leading to higher yields and better farm practices.

Rural Infrastructure:
NABARD’s support for rural infrastructure has improved connectivity and access to markets for rural communities.

Financial Inclusion:
It has played a vital role in promoting financial inclusion by supporting microfinance institutions and SHGs.

NABARD’s initiatives have empowered rural communities by providing them with access to credit and training.

Sustainable Practices:
It has encouraged sustainable agricultural practices, promoting eco-friendly and organic farming methods.


The National Bank for Agriculture and Rural Development (NABARD) is a cornerstone of rural and agricultural development in India. With its multifaceted approach, it has significantly contributed to improving the lives of rural communities, empowering farmers, and fostering sustainable agriculture. NABARD’s work exemplifies the vital role financial institutions can play in driving economic growth and social progress in rural areas.

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