RURAL INFRASTRUCTURE DEVELOPMENT FUND (RIDF) SCHEME

Introduction Rural Infrastructure Development Fund (RIDF), under the aegis of NABARD, provides loans to the State governments to attend to the needs of rural infrastructure to accelerate completion of ongoing irrigation projects, including Watershed Development & Soil Conservation etc. The scope of RIDF will also be widened to allow lending to Gram Panchayats, Self-Help Groups and other eligible organisations for implementing villagelevel infrastructure projects. The Fund was to be raised from the commercial banks to the extent of their shortfall in agricultural lending. The Fund has continued and the corpus is announced every year during the budget. Though the initial thrust had been on irrigation projects, the development of rural roads and bridges has received a major boost since the time of RIDFII. Subsequently, many other activities were gradually added to the list of eligible activities under RIDF. Eligible Activities The activities, which have been made eligible for loans from RIDF, are: 1. rural roads and bridges; 2. irrigation, mini and small hydel projects; 3. community irrigation wells; 4. soil conservation, watershed development and reclamation of waterlogged areas; 5. flood protection; 6. drainage; 7. forest development; 8. market yard, godowns, apna mandi, rural haats and other marketing infrastructure; 9. cold storages; 10. seed/agriculture/horticulture farms; 11. plantation and horticulture; 12. grading and certifying mechanisms such as testing and certifying laboratories; 13. fishing harbour/jetties; 14. riverine fisheries; 15. animal husbandry; 16. modern abattoir; 17. drinking water supply; 18. infrastructure for rural educational institutions; 19. public health institutions; 20. construction of toilet blocks in existing schools and pay and use toilets in rural areas; 21. village knowledge centres;

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22. desalination plants in coastal areas; 23. infrastructure for information technology in rural areas; 24. construction of anganwadi centres. Project Sanction The projects pertaining to eligible sectors under each RIDF tranche are submitted by the State Governments through their Finance department to NABARDs Regional Offices. The project proposals are scrutinized and appraised by the Regional Office with the help of Consultants by conducting desk and field appraisal. Appraisal reports submitted by the ROs are then scrutinised by State Projects Department at HO before placing the same to Sanctioning Committee (SC) for consideration of sanction. Normally seven or eight meetings of SC are held in a year to sanction loans from the RIDF corpus. Sanction of projects is communicated to the State Governments by a sanction letter which consists of General Terms and Conditions as well as Special Terms and Conditions / suggestions which are project specific. Borrowing Units Initially, only Sate Governments were eligible to borrow out of RIDF on project basis. However, Panchayat Raj Institutions (PRIs), Non- Governmental Organisations. Self-Help Groups, etc. were made eligible to borrow out of RIDF w.e.f. 1st April 1999. Quantum of loan The quantum of loan for projects relating to Agriculture and related sectors, Social sector and Rural Connectivity is, as of now, 95%, 85% and 80% of the eligible project cost, respectively. For projects from the North Eastern States and Sikkim and Hill-States of Himachal Pradesh, Jammu & Kashmir and Uttarakhand, the quantum of RIDF assistance in case of Social sector and Rural Connectivity sector is, as of now, 90% of the eligible project cost. Period of Loan The repayment period of 5 years including a 2 year grace period was provided under RIDF-I to RIDF-V. The repayment period has, however, been extended to 7 years including a grace period of 2 years since RIDF-VI and the same is continuing. Nodal Department for RIDF The Finance Departments of the State Governments act as Nodal Departments for operationalising RIDF. The project proposals are routed through the Finance Department only and no proposal is accepted directly from any other Department of the State

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Government. All other related items of work like submission of drawals applications under sanctioned projects, release of loan, execution of documents, repayment of loans, etc., are attended to by Finance Departments of the State Governments under sanctioned projects, release of loan, execution of documents, repayment of loans, etc., are attended to by Finance Departments of the State Governments. Appraisal of Projects Regional Offices receive the detailed project reports from State Governments based on their priorities and within the priorities/activities decided under RIDF. The detailed project reports are subject to field and desk appraisal by a team comprising of NABARD officers as well as consultants, who are normally senior retired officers of the concerned departments of State/Central Government. What Webcon can do to take advantage of the scheme? 1. Identify the sectors out of the 31 eligible sectors of RIDF where Webcon wants to prepare DPRs. 2. Identify eligible projects for RIDF and then approach the concerned government departments (East and NE) apart from the ones for which we are already working. 3. Send letters to eligible government departments (East and NE) informing them that Webcon prepares DPRs for RIDF projects. 4. Personally approach the government departments to inform them that Webcon is interested in preparing DPRs for RIDF projects. 5. Since the projects pertaining to eligible sectors under each RIDF tranche are submitted by the State Governments through their Finance department, approach the finance departments of the eastern and NE states to participate as a consultant for their RIDF projects.