R I D F (Rural Infrastructure Development Fund)

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RIDF
Rural Infrastructure Development Fund (RIDF) was instituted in NABARD with an announcement in the Union Budget 1995-96 with the sole objective of giving low cost fund support to State Govts. and State Owned Corporations for quick completion of ongoing projects relating to medium and minor irrigation, soil conservation, watershed management and other forms of rural infrastructure.
Punjab National Bank

RIDF
RIDF was operationalised through NABARD for financing of, at that point of time, the ongoing rural infrastructure projects in irrigation sector which were incomplete due to inadequate budgetary resources. As per GoI instructions, only ongoing Irrigation, Flood Protection, Watershed Management projects were financed under RIDF I as a 'last mile approach' to facilitate completion of the projects.

Punjab National Bank

RIDF The financing of rural Road & Bridge projects was started during RIDF II. Subsequently, coverage of RIDF was broad-based in each tranche (part) and at present, a wide range of 31 activities, as approved by GoI, covering almost all aspects of rural infrastructure is being funded under RIDF.
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RIDF

These activities are classified broadly under three categories as (i) Agriculture and related sectors, (ii) Social Sectors and (iii) Rural connectivity.

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RIDF
Agriculture and related sectors 1. Minor Irrigation Projects/ Micro Irrigation; 2. Soil Conservation; 3. Flood Protection; 4. Watershed Development/ Reclamation of waterlogged areas; 5. Drainage; 6. Forest Development; 7. Market Yard, Godown, Mandi, Rural Haat, and Marketing Infrastructure;
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RIDF
8. Cold Storage, Public/ Joint sector cold storage at various exit points; 9. Seed/ Agriculture/ Horticulture Farms; 10. Plantation and Horticulture; 11. Grading/ certifying mechanisms, testing/ certifying laboratories; 12. Community Irrigation wells for the village as a whole; 13. Fishing harbour/ jetties; 14. Riverine Fisheries; 15. Animal Husbandry;
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RIDF
16. Modern Abattoir; 17. Medium Irrigation Projects; 18. Mini Hydel Projects/ Small Hydel Projects (upto 10 MW); 19. Major Irrigation Projects (already sanctioned and under execution); 20. Village Knowledge Centres; 21. Desalination plants in coastal areas; 22. Infrastructure for Information Technology in rural areas;
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RIDF
Social Sectors 23. Drinking Water; 24. Infrastructure for Rural Education Institutions; 25. Public Health Institutions; 26. Construction of toilet blocks in existing schools, specially for girls 27. "Pay & use" toilets in rural areas; 28. Construction of Anganwadi Centres; 29. Setting up of KVIC industrial estates/ centers.
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RIDF

Rural connectivity
30. Rural Roads; 31. Rural Bridges;

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RIDF
After the allocation under RIDF in each tranche is announced in the Union Budget, the same is allocated among all States on the basis of norms prescribed by the Project Sanctioning Committee (PSC). RIDF financing is not intended to be a fund-based approach, rather sanctions to States would depend upon the availability of projects conforming to the priorities and norms".

Punjab National Bank

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 Offices with the help of Consultants by conducting desk and field appraisal for technical feasibility, economic/ financial viability and social benefits. The project normally should be completed in 3-5 years.
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NABARD provides loan to the extent of 95 per cent for Agriculture and related sectors, 85 per cent for Social sectors and 80 per cent for Rural connectivity to all States except North East and Hilly States where it is 95 per cent for Agriculture sector and 90 per cent for Social sector & Rural connectivity. The balance amount is contributed by the respective State Govts. through budgetary support.
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The increase in the level of rural infrastructure had two effects: the promotion of economic growth and a decline in the incidence of absolute poverty (NCAER 2006). Another study (Thorat & Sirohi, 2002) observed that transport, power, irrigation and research infrastructure are four critical components, which affect the agricultural productivity significantly.
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Development of the rural infrastructure facilitated capital formation in agriculture in private sector through institutional credit support. Ex. Bridges and road construction help in increasing tractor business. Similarly, irrigation projects help in increased use of pumpsets, tractors..
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