Question : Which institution in India provides long-term credit to farmers for agricultural activities?
Option 1: National Bank for Agriculture and Rural Development (NABARD)
Option 2: Reserve Bank of India (RBI)
Option 3: Agricultural Insurance Corporation of India (AIC)
Option 4: Small Industries Development Bank of India (SIDBI)
Correct Answer:
National Bank for Agriculture and Rural Development (NABARD)
Solution : The correct answer is (a) National Bank for Agriculture and Rural Development (NABARD).
NABARD is a specialized development bank in India that focuses on the agricultural and rural sectors. It provides long-term credit to farmers for various agricultural activities, including crop production, land development, farm mechanization, irrigation, and other allied activities.
NABARD offers credit facilities to farmers through its Rural Infrastructure Development Fund (RIDF) and other agricultural development programs. It provides loans to farmers through cooperative banks, regional rural banks (RRBs), and other financial institutions.
In addition to providing credit, NABARD also plays a crucial role in promoting rural development, rural infrastructure, agricultural research and development, and capacity building among farmers and rural communities.
While the Reserve Bank of India (RBI) is the central bank of India and plays a regulatory role in the overall banking system, including setting monetary policies, it is NABARD that specifically focuses on providing long-term credit to farmers and rural development.
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