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In the context of banking reforms for strengthening the financing system in rural India, the year 1982 is important because
- a)the first regional rural bank came into being that year.
- b)it was the year in which the first phase of nationalisation of banks took place.
- c)National Bank for Agriculture and Rural Development (NABARD) was set up.
- d)the Reserve Bank of India introduced and formalised the concept of priority sector lending.
Correct answer is option 'C'. Can you explain this answer?
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In the context of banking reforms for strengthening the financing syst...
- National Bank for Agriculture and Rural Development (NABARD) was set up in 1982 as an apex body to coordinate the activities of all institutions involved in the rural financing system. It was established in 1982 under the National Bank for Agriculture and Rural Development Act, 1981. Hence option (c) is the correct answer.
- NABARD is a development bank in India that focuses on providing financial and other support to the agriculture and rural development sectors. It offers a range of financial products and services, including various funds, to meet the needs of its clients.
- NABARD is responsible for supervising and providing financial assistance to the Regional Rural Banks (RRBs) in India. RRBs are public sector banks that were established to provide banking and financial services to the rural and semi-urban areas of the country.
- Some of the funds managed by NABARD include:
- Rural Infrastructure Development Fund (RIDF),
- Dairy Processing and Infrastructure Development Fund (DIDF),
- Rural Innovation Fund (RIF)
- The origins of priority sector (PS) lending can be traced back to 1966 when Morarji Desai saw a need for increasing credit to agriculture and small industries. However, the definition of PS was only formalized based on a Reserve Bank of India (RBI) report in the National Credit Council in 1972. The Priority Sector norms are applicable to apply to every Commercial Bank [including Regional Rural Bank (RRB), Small Finance Bank (SFB), and Local Area Bank], and Primary (Urban) Co-operative Bank (UCB) other than Salary Earners’ Bank. As per the PSL norms, the Domestic commercial banks (excluding RRBs & SFBs) & foreign banks with 20 branches and above are mandated to allocate 40 percent of Adjusted Net Bank Credit (ANBC) to the priority sectors.
- Rural Banks were set up on the basis of the recommendations of the Narasimham Working Group (1975), and after the legislation of the Regional Rural Banks Act, 1976. The first Regional Rural Bank “Prathama Grameen Bank” was set up on October 2, 1975.
- The first phase of the nationalization of banks took place in 1969. 14 banks were nationalized that year.
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In the context of banking reforms for strengthening the financing syst...
Establishment of NABARD in 1982
NABARD, or the National Bank for Agriculture and Rural Development, was established in 1982. This institution plays a crucial role in strengthening the financing system in rural India by providing credit facilities and promoting sustainable rural development.
Role of NABARD
NABARD acts as a refinancing agency for institutions providing investment and production credit for promoting various developmental activities in rural areas. It also supervises and coordinates the functions of institutions engaged in rural financing.
Focus on Agriculture and Rural Development
NABARD focuses on agriculture and rural development by providing financial assistance to farmers, rural artisans, small and marginal entrepreneurs, and other rural individuals. This support helps in enhancing agricultural productivity, rural employment, and overall rural prosperity.
Enhancing Financial Inclusion
Through its various schemes and initiatives, NABARD aims to enhance financial inclusion in rural areas by providing access to credit and other financial services to the rural population. This, in turn, helps in reducing poverty and improving the standard of living in rural India.
Importance in Banking Reforms
The establishment of NABARD in 1982 marked a significant milestone in banking reforms for strengthening the financing system in rural India. It has played a crucial role in channeling credit to the rural sector and supporting various rural development initiatives, thereby contributing to the overall economic growth of the country.
NABARD, or the National Bank for Agriculture and Rural Development, was established in 1982. This institution plays a crucial role in strengthening the financing system in rural India by providing credit facilities and promoting sustainable rural development.
Role of NABARD
NABARD acts as a refinancing agency for institutions providing investment and production credit for promoting various developmental activities in rural areas. It also supervises and coordinates the functions of institutions engaged in rural financing.
Focus on Agriculture and Rural Development
NABARD focuses on agriculture and rural development by providing financial assistance to farmers, rural artisans, small and marginal entrepreneurs, and other rural individuals. This support helps in enhancing agricultural productivity, rural employment, and overall rural prosperity.
Enhancing Financial Inclusion
Through its various schemes and initiatives, NABARD aims to enhance financial inclusion in rural areas by providing access to credit and other financial services to the rural population. This, in turn, helps in reducing poverty and improving the standard of living in rural India.
Importance in Banking Reforms
The establishment of NABARD in 1982 marked a significant milestone in banking reforms for strengthening the financing system in rural India. It has played a crucial role in channeling credit to the rural sector and supporting various rural development initiatives, thereby contributing to the overall economic growth of the country.
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In the context of banking reforms for strengthening the financing system in rural India, the year 1982 is important becausea)the first regional rural bank came into being that year.b)it was the year in which the first phase of nationalisation of banks took place.c)National Bank for Agriculture and Rural Development (NABARD) was set up.d)the Reserve Bank of India introduced and formalised the concept of priority sector lending.Correct answer is option 'C'. Can you explain this answer?
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In the context of banking reforms for strengthening the financing system in rural India, the year 1982 is important becausea)the first regional rural bank came into being that year.b)it was the year in which the first phase of nationalisation of banks took place.c)National Bank for Agriculture and Rural Development (NABARD) was set up.d)the Reserve Bank of India introduced and formalised the concept of priority sector lending.Correct answer is option 'C'. Can you explain this answer? for UPSC 2024 is part of UPSC preparation. The Question and answers have been prepared according to the UPSC exam syllabus. Information about In the context of banking reforms for strengthening the financing system in rural India, the year 1982 is important becausea)the first regional rural bank came into being that year.b)it was the year in which the first phase of nationalisation of banks took place.c)National Bank for Agriculture and Rural Development (NABARD) was set up.d)the Reserve Bank of India introduced and formalised the concept of priority sector lending.Correct answer is option 'C'. Can you explain this answer? covers all topics & solutions for UPSC 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for In the context of banking reforms for strengthening the financing system in rural India, the year 1982 is important becausea)the first regional rural bank came into being that year.b)it was the year in which the first phase of nationalisation of banks took place.c)National Bank for Agriculture and Rural Development (NABARD) was set up.d)the Reserve Bank of India introduced and formalised the concept of priority sector lending.Correct answer is option 'C'. Can you explain this answer?.
In the context of banking reforms for strengthening the financing system in rural India, the year 1982 is important becausea)the first regional rural bank came into being that year.b)it was the year in which the first phase of nationalisation of banks took place.c)National Bank for Agriculture and Rural Development (NABARD) was set up.d)the Reserve Bank of India introduced and formalised the concept of priority sector lending.Correct answer is option 'C'. Can you explain this answer? for UPSC 2024 is part of UPSC preparation. The Question and answers have been prepared according to the UPSC exam syllabus. Information about In the context of banking reforms for strengthening the financing system in rural India, the year 1982 is important becausea)the first regional rural bank came into being that year.b)it was the year in which the first phase of nationalisation of banks took place.c)National Bank for Agriculture and Rural Development (NABARD) was set up.d)the Reserve Bank of India introduced and formalised the concept of priority sector lending.Correct answer is option 'C'. Can you explain this answer? covers all topics & solutions for UPSC 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for In the context of banking reforms for strengthening the financing system in rural India, the year 1982 is important becausea)the first regional rural bank came into being that year.b)it was the year in which the first phase of nationalisation of banks took place.c)National Bank for Agriculture and Rural Development (NABARD) was set up.d)the Reserve Bank of India introduced and formalised the concept of priority sector lending.Correct answer is option 'C'. Can you explain this answer?.
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