Nabard sanctions 27% more funds for West Bengal under RIDF

KOLKATA: West Bengal has received 27% higher allocation for developing rural overheads in 2012-13 under central government's Rural Infrastructure Development Fund (RIDF) scheme.

The National Bank for Agriculture and Rural Development or Nabard, which acts as the nodal body for RIDF, said it has sanctioned Rs 1,402.37 crore in the fiscal to March 2013, while about one-third of the allocated fund has been earmarked for improving road connectivity.

Another major chunk of the fund -- Rs 235 crore -- is allocated for the state's food protection and prevention of soil erosion projects.

Total RIDF kitty for all states was Rs 20,000 crore in 2012-13 including Rs 5,000 crore earmarked to build warehouses.

Nabard releases up to 20% of the sanctioned loan amount immediately and pays the balance on reimbursement basis over a three to five years.

Interest rate on RIDF loans is kept 150 basis point lower than bank rate, which is 8.5% at present.

West Bengal has also got another Rs 161 crore sanctioned for building 29 rural godowns in 14 districts.

RIDF is an instrument for routing bank funds for rural infrastructure financing. Banks which fail to meet priority sector lending targets are told to deposit the shortfall with Nabard at a lower interest rate as a penalty.