The National Bank for Agriculture and Rural Development (NABARD) has entered into a partnership with the Asian Development Bank (ADB) to address the challenges posed by climate change in the agricultural sector.
In conjunction with the Bill and Melinda Gates Foundation, these organizations aim to leverage global climate capital to finance initiatives related to agriculture, natural resources, and rural development (ANR) in India.
The primary objective of this collaboration is to bolster food security and climate financing within India’s ANR sector. NABARD is set to receive support in developing a climate financing policy and facilitating its adoption.
Shaji KV, Chairman of NABARD, emphasized the urgency of addressing climate challenges, noting that approximately 55% of the assets in the country’s banking sector are susceptible to climate risks.
To enhance their efforts, a technical support unit (TSU) will be established within NABARD in association with the Bill and Melinda Gates Foundation. This unit will specifically focus on addressing climate-related challenges in the agriculture and rural livelihood sectors of the country.
Shaji KV expressed the intention to leverage the ADB’s expertise and global reach to mobilize financial resources on a global scale. The collaboration aims to identify and support food security and climate financing programs in the ANR sector. The support may extend to NABARD’s ongoing and future projects, incorporating contributions from the ADB and other public and private funds.
Eligible projects for support include climate-resilient agriculture and agroforestry, irrigation modernization, agriculture value chain financing, crop diversification, micro-irrigation, and the JIVA program—a community-based initiative covering watershed and tribal areas with a funding commitment of approximately Rs 5,000 crore.
The ADB will also play a role in capacity building for climate resilience and climate change financing through workshops and training sessions for NABARD, the Bankers Institute of Rural Development, and other subsidiaries and stakeholders.
The collaboration will explore and pilot-test climate change adaptation financing programs that can later be scaled up. These programs will be piloted through NABARD’s local branches across the country.
The overarching goal is to boost climate change adaptation financing in the ANR sector by leveraging a wide range of public and private financiers. This approach will also enable farmers to benefit from carbon sequestration credits and other ecosystem services while considering environmental due diligence, safeguards, and addressing social, poverty, and gender aspects.
Intellecap Advisory Services Private Limited will manage the established TCU under the agreement, leveraging its experience in overseeing large-scale programs in agriculture and allied sectors with a specific focus on climate adaptation and mitigation.
