NABARD and NaBFID Sign MoU to Jointly Finance Rural Infrastructure Project

Two of India's key development finance institutions have joined hands to boost infrastructure funding in rural areas. NABARD and NaBFID signed a Memorandum of Understanding on 26 August 2026, in Mumbai, aiming to unlock long-term, affordable financing for projects that can transform rural connectivity and value chains.

Key Areas Under the NABARD and NaBFID MoU

1. The agreement was signed by NABARD Chairman Shaji Krishnan V and NaBFID Managing Director Rajkiran Rai G.
2. It sets up a framework for joint financing, sharing expertise, and building innovative funding models for projects with strong rural relevance, including Public Private Partnership (PPP) ventures and agri-value chains.
3. Specific focus areas named in the pact include water and sanitation, irrigation systems, post-harvest storage and cold-chain infrastructure, terminal markets, rural roads and bridges, warehousing, and compressed biogas facilities. 
4. These sectors are seen as essential building blocks for making rural India's infrastructure more resilient, aligning with the broader Viksit Bharat vision.

About NABARD and NaBFID

1. NABARD, or the National Bank for Agriculture and Rural Development, was set up in 1982 and functions as India's top development bank dedicated to agriculture and rural growth. 
2. NaBFID, on the other hand, is a newer institution, established in 2021 specifically to finance large infrastructure projects across the country. Bringing these two together combines NABARD's deep rural outreach with NaBFID's infrastructure financing expertise.

The NABARD-NaBFID Partnership

NABARD Chairman Shaji Krishnan V said this tie-up could help close the long-standing rural-urban divide and push rural prosperity forward, calling the MoU a strong starting point for deeper cooperation. NaBFID's Rajkiran Rai G described the collaboration as a natural fit between the two institutions, pointing to real opportunities in food processing, storage, and cold-chain connectivity that could directly raise farmer incomes. Together, the two organisations hope to make more long-term finance available for rural projects, improve market access and connectivity, and ultimately strengthen India's rural economy while narrowing the gap between rural and urban development.