NABARD@2022 By this time NABARD will complete 40 years of its establishment. At that age we should be able to

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A really committed organisation for the purpose of removing poverty, unemployment and ignorance from the society with substantial achievements in its bag in terms of ensuring doubling of the average net income of the Indian farmers (compared to the level of 31st March 2016) Balance sheet worth US $100 bn and Profitability over US $ 2 bn. Directly influenced population – 10 million functional SHGs, 02 million SHG based profitable micro-enterprises, over 6 lakh vibrant farmers clubs in all villages of the country, 2500 FPOs as profitable and sustainable business enterprise with average annual turnover of Rs. 5 Cr. And Net profit of Rs. 30 lakh. Scope of work (advocacy, policy formulation, developmental, promotional, business, research, more number of subsidiaries, etc.) Partners (UN and all its organisation, various regional international forums, World Bank group, IMF, ADB, AIIB, BRICS NDB, etc.) Recognised by Nobel Peace Prize An efficient, effective, credible, paper-less and Lean organisation with collaborative and cooperative relations towards its partners

Domain  Global economy

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Indian economy

Issue  Stagnation  Emerging economies are driving the economic growth  Quantitative easing Federal Reserve: implications for India (rate hike expected in December) : not good in integrated world economy when world economy is in turmoil.  Rupee value decreasing (effect on import/ export and cost of funds)  Chinese crisis  Lower commodity prices  Currency devaluation efforts  Cascading effects of currency devaluation  WTO TFA (peace clause)  WB, IMF projections about indian economy  GOI Initiatives  Agriculture being neglected  Deflation in figures but ‘mahangai’ in reality  Crisis of pulses (feeling the pulse)  Supply side challenges  Financial Inclusion (Jan Dhan Yojana, PMJJBY, PMSBY)  Make in India vs Make for India  Digital India, Skill India, Startup India  Ease of doing business

Solution  Rupee Bonds (Masala Bonds) in international financial markets to raise cost effective funds  Hedging of foreign funds against currency volatility  Diverse sources of funds in different currencies.  Coherence with policies of international organisations (IMF, Federal Reserve, etc.)  Concurrent monitoring and research to project the impact of the foreign incidents on rural economy and agriculture.  Rigorous research based adequate and timely policy suggestions to GOI, RBI and advocacy through media and civil society

 We should develop separate index about agriculture and rural economy.  We should provide alternative solutions to enhance “Ease of Doing Business” for farmers and other rural producers.  We have to show crusading policy advocacy in favour of small and marginal farmers whenever we feel any adverse impact of any initiatives of GOI on them and provide alternative paths.  Leverage digital India/skill india/ startup india and be a partner wherever and in whatever manner it is possible.  Focus on Digital Inclusion through digitization of SHGs/Farmers Clubs/ PACS/FPOs/ District Industries Centres/ Gram Panchayats  Think for Big Data and Analytics and next step after digitisation.

Domain 

RBI

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Threats to agriculture and rural economy

 NABARD’s challenges

Issue  RBI initiatives  Monetary policy (impacts and limitations)  How far it can control inflation  Growth v/s inflation  Cyber threats to financial sector  Repo rate cut by RBI  Small finance banks  Payment banks  New technology arm of RBI  Advances technologies  Artificial intelligence  Internet of things  Increasing industrialisation and urbanisation threat to availability of the Net Crop Area.  Land Acquisition bill (effect on agriculture)  Self-sustaining farmers will also have to purchase grains  Technology intensive agriculture will lack equity in agriculture and increase agriculture labourers.

 Great mandate vs shrinking resources

Solution  Partner with C-DAC/ IITs/NITs/CSIR Labs/ISRO etc. for technology transfer for the benefit of Rural India.  Develop better convergence with RBI and partner in its policy decisions.  Provide alternative solutions of food inflation  Develop cyber security policy for NABARD, RFIs, SHGs and other rural institutions  Capacity building, technology upgradation and additional support to RFIs to face the challenges provided by New type of Banks.

 Skill development  Agri supply chain infrastructure  Use of ICT for farmers and rural producers  Enjoying the benefits of advanced technology converting threats into opportunities through innovative customisation  Aggressive (& diverse) use of climate change funds for increasing afforestation and viable solutions for sustainable and equitable agriculture growth.  Creating a new national level architecture of RRBs (National Rural Bank of India) wherein all the current RRBs will merge over a period of time. It will consolidate their strength. The Head offices of the existing RRBs may be given the calibrated autonomy to function as local head offices of NRBI.  Our key focus in near term should be to align all our policies and programmes to ensure doubling of farmers net income in next five years (as envisaged by GOI)  Back to root statement (mission statement of NABARD)  Advocacy for SF/FM led agriculture development

Domain         Future of NABARD

Issue Agrarian crisis Supporting RFIs Ensuring food security Increasing the Net Interest Margin Resource augmentations Risk free to risky domain Development and business

 Determining the future  Whether Future we want could be realised  Strategic thinking approach  Executing the strategy (harmony among strategy, operations and people)  Future of brand NABARD  Managing change in approach of thinking, planning, executing and monitoring of the NABARD and core clients

Solution  Alternative resources  Innovative business models  Visualise NABARD (against world economy, Indian economy, agri economy, rural economy, etc.) in terms of balance sheet ( and Profit & loss a/c) figures against each source and use of funds (similarly in the P&L a/c) including the new expected sources/ use of funds after 5, 10, 20, 50 years.  Develop the Balanced Score Card to meet these targets  Balancing Financials vs goodwill  Vision Statement (To realise sustainable development)  ‘Mission statement’- (to play leadership role in the sustainable development movement with primary focus on sustainable and equitable agriculture and rural development on the entire planet world through effective credit support, institutional development, collaboration and effective use of technology for increasing productivity and production with minimal carbon footprint)  Tagline1 – (crusading for sustainability)  Tagline2-(creating sustainable happiness)  Tagline3- (Building the equitable future)  Implement the Work Process Engineering (Business Process Reengineering) with active support of the consulting faculty from the IIM-A and/ or National Institute of Industrial Engineering (NITIE), Vihar Lake, Powai, Mumbai (www.nitie.edu )  We may have to internationalise ourselves. Our acronym would be same (NABARD) but abbreviation may change. NABARD may become an international/ multi-lateral organisation with share capital from other national governments/ international institutions.

Domain

Issue

 Traditional business 

 RIDF  Refinance  Shrinking sources vs increasing demand

 New business areas

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NIDA CFF PODF Venture capital fund Risk management Resource mobilisation Starting new Subsidiaries

Solution  NABARD should aspire to be the future equivalent of World Bank Group, ADB, BRICS Bank etc.  We may create a new architecture wherein similar institutions in various countries should affiliate to it. (like dominance of the BCCI in world cricket through ICC)  We have to aggressively and strategically increase our networth/ share capital and hence the borrowing power.  We should adopt aggressive strategy to create greater and greater demand for credit in rural areas in general and agriculture in particular. We should avoid to adopt short-sighted measures to grow our business. Such kind of demand will create scope for our businesses to grow in all dimensions.  Alternative sources of funds  Soft loans from WB group, ADB, AIIB, BRICS New Development Bank with or without GOI guarantee.  Revolving funds from GOI  Better networking with govt and non-govt.  Project financing approach.  Technical capacity building of staff.  More delegation to ROs  Entrepreneurial style of working  More Flexible products  Target Renewable Energy financing and Project Management as the new venture with active collaboration with MNRE (GOI), IREDA, State Governments, International Solar Alliance countries, International Energy Financial Institutions, floating Rupee Solar Energy Bonds abroad, etc.  Rural BPO in local Indian languanges could be another great venture

Domain

Issue

 Promotion al & development activities under micro credit and financial inclusion

 SHG digitization  Monitoring mechanism  Moving towards sustainable livelihoods  Convergence with GOI/ State Govt schemes  E-commerce, organised retail  Role of Small finance banks and payment banks  Lack of captive marketing infrastructure in urban areas.  Lack of CBOs in urban areas  Test check of the field level physical of our (non-dormant) interventions will open our eyes as it seems to be very less fraction of the data we claim to have (no. of bank linked/ credit linked SHGs, Farmers clubs, JLGs, Wadis, Watersheds, etc.)

 Promotion al and development activities under

 Supply chain inefficiency.  Un-integrated supply chain  Large number of intermediaries between farmers and consumers

Solution  New Payment Banks and Small Finance Banks as subsidieries of NABARD.  Strengthening the cooperative credit structure to mobilise rural deposits. Making provisions (similar to producer organisation) in companies act for cooperative credit institutions also.  Mobilisation of savings of SHGs.  Enabling better and adequate credit linkage  Adoption of technology for flow of funds, information and business management.  Market linkage.  Focus on consolidation through SHG federations  SHG federations as Producers’ Organisations.  Major focus on Institutional development to enable the existing RFIs through their consolidation, recapitalisation, technology-led transformation to sustain themselves.  NABARD should now also engage urban poor in the fold of its CBOs viz. SHG-BLP, JLG, Street Vendor clubs, Home-maid clubs, Farm/ Non-farm sector POs (handicraft, handloom, knitwear designers, local tailors, carpet workers, etc.), etc. as these CBOs can act as the cost effective channels of direct marketing of the produce made by themselves as well as the rural CBOs in the ocean of urban consumers.

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Cold storage Producers organisations Pooling of resources for better efficiency Leverage new technology

Domain farm and nonfarm sector development

Issue  Half-hearted hand holding support to the FPOs by the ROs and RSAs.

Solution  Partner with CSIR labs and other technology/ research institutes/ industry for technology transfer and to get manuals to design and produce products/ services of standard quality in cost effective manner by the Activity based SHGs, FPOs, etc..  Better backward and forward linkage through better engagement with respective institutions/ industry.  Develop consortium based brands and FPOs.  Dedicated training for officials handling FPOs and depute them in Special Purpose Vehicles to promote and develop these FPOs/ SHG/ Farmers clubs based collective producers.  New architecture of FPOs need to be built up to consolidate their strength in the market. FPOs at block/ district level can contribute to the share capital of the FPOs of State Level and similarly the state-level FPOs can become shareholders of the National level FPOs. The district level FPOs should also be allowed to contribute to the share capital of the national FPOs.  A pool of experts like Chartered Accountants, Company Secretaries, Chartered Financial Analysts, Corporate Lawyers, dairy technologists, food technologists, supply chain managers, agri-scientists, etc. is needed for regular hand holding support to the FPOs. These experts could be engaged by the respective Resource Support Agencies (RSA). Performance of these experts as well as the RSA should be regularly evaluated from the highest level.  The FPOs may have national/ international supply chain and marketing of their own, hence disrupting the entire retail industry.  NABARD may float subsidiaries as joint venture with such large national level FPOs.  A national level exchange for transferring of the shares from producers members of any FPO to producer members of

Domain

 Digitisatio n of nabard

Issue

 Increasing business/ clients/ risk/ complexity demand better, secured and sophisticated technology platform to ease the work load, enable to compile and analyse data.  Cyber security is major challenge  Digitisation of clients demands parallel digitisation of NABARD with greater speed and accuracy.

Solution any other FPO anywhere in India, may be set-up. It will boost the capital inflow for FPOs.  The equity grant and credit guarantee funds (EGCGF Scheme) by SFAC should be upgraded into different bands considering the maturity level of FPOs.  Exemptions on-par with agriculture income should be given in Income-tax/ corporate tax on FPOs.  FPOs have the potential to change not only the agriculture sector but also the direction and spectrum of ownership of the means & modes of productions and distribution (having wide and long term socio-economic-political revolutionary impact)  New vibrant and dedicated IT wing under the leadership of an expert IT professional as Chief Technology Officer.  IT/ITeS/BPO could be one of the new areas of business of NABARD. Currently Indian IT market is just $5 bn only but expected to grow exponentially, great opportunity for NABARD as we know needs of rural institutions better.  Integrate IT infrastructure of RFIs with NABARD.  Mistakes to be resolved regularly  Cyber threats to NABARD  Optimised operations  Realistic assessment of needs of NABARD and better customisation of technology products within reasonable time and cost with required flexibility to update as per need.  Constantly upgrade CLMAS/Nabnet/Nabmail  Integrated Enterprise Resource Planning based IT platform for NABARD  Nabnet as Mobile App for employees  GLC/SHG Portal as Mobile app for clients

Domain  Cultural change in NABARD

Issue  Existing culture inhibiting the efficiency and decision making  Hesitation for sharing new ideas, bringing changes.  Traditional hierarchical approach of thinking and working.  Formal-ness is prevailing  No to use of discretion in decision making is retarding business growth.  Lack of real time based response to the stakeholders making them feel pity of the bureaumania or to get avoidable response when we urgently need their support/ cooperation.

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Solution Open mindedness/ More delegation (as the mind works only when it is given due freedom and flexibility to think not only in the given boundaries but beyond these limits which will explore new opportunities and will also ensure adaptation to the external socio-economic and political changes) IT enabled Knowledge management/Study groups/ IT based advanced learning tools as Change agents/ change leaders across the hierarchy to be promoted Organic thinking approach should be encouraged. Develop feedback/ suggestion portal on Nabnet. Allow people to openly express their concerns/ thoughts/ ideas, etc.in greater detail through blogs, interest groups, etc. Remove the fear of getting punished/ showing memorandum on small mistakes or being labelled with their one-time mistakes. Allow people to commit mistakes while taking initiatives. Involve entire ladder into decision making process to inculcate ownership. We have to remove the culture of passing the ball on each other’s court. Focus on an Individual (officer/ staff) as a thinking human being and let him design his work, career, tasks, social actions, organisation improvement. Involve sociologists, psychologists, ergonomists, etc. to inculcate the kind of organisational work culture which we wish to have. Here also active involvement of NABARDians is indispensable. Let them also participate to decide and inculcate the desired work culture.

Domain

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Solution Cultural/ organisational change is uncomfortable. Realistic feedback from lower spectrum of organisation should not be taken as breach of hierarchical structure, it shouldn’t be responded by showing the individual his/ her place in the hierarchy and keep his/ her mouth and advise to act as mute and remote-controlled robots. People should be sensitized to adapt to it. Understanding of the urgency of cultural change is necessary. Change management need to be learned by all. An organization wide aggressive initiative for cultural change need to be adopted