UpVey

Introduction

NABARD can be expanded as National Bank for Agriculture and Rural Development.  This was set up on 12 July 1982 on the recommendations of the B. Sivaraman committee with regards to the implementation of the National Bank for Agriculture and Rural Development Act 1981 and it has been the top Development Financial Institution in India.

The main functions of NABARD pertain to policy development, coordination, research, training, etc., relating to rural credit. It provides refinance lo cooperatives, regional rural banks, etc. Moreover, it makes loans and advances to state governments for a period not exceeding more than 20 years to enable (them to subscribe directly or indirectly to share the capital of cooperative credit societies.

The authorized paid-up capital is more than Rs.30, 000 cr. Government of India holds 100% of the share capital. NABARD has it’s headquartered in Mumbai. It has been the key to providing rural services, innovative social services, and the provision of credit services in the rural parts of India.

Roles

• NABARD supports the cottage industries –Most of the cottage and SMEs in India are situated in the rural part and it has played a crucial role in reorganizing the cottage industry such that rural areas of India have become a key contributor to the growth of India.
• It brought collaboration between the rural and national economy by reaching out to various industries and sectors like fertilizer manufacturers, pesticide developers, and farm equipment producers and linking each other for collaborative growth. This led to a mutual benefit cycle that helped both the economy.
• It serves as the apex body for providing a range of services that involves financing and provision of credit to the rural regions for carrying out a range of development activities.
•  It is also a key body to support new agencies and institution come up specifically targeting Indian villages and their inhabitants. These agencies are specifically targeted to end scrutiny, rehabilitation unit creation, credit institution restructuring, training new hires, etc.
• It also plays the role of an intermediary to various rural financing agencies that operate at the bottom-most level. It also acts as a bridge between RBI, Indian Government, state-level bodies.
• It also takes part in developing other organizations that take part in the development of the rural economy.
• It plays a crucial role in the development and support of the functioning of Co-operative banks in the process of regulation and also training their staff.

Function

• It acts as the apex financing body for the provision of credits to agencies or firms which are focused upon promoting various development activities in rural areas.
• It pays special attention to projects built under the Integrated Rural Development Program (IRDP).
• It arranges to refinance for IRDP accounts in order to give the highest share of contribution towards the abolition of poverty.
• It provides instructions for the promotion of group activities under its programs and provides 100% refinance support for them.
• It helps to connect the Self-help Group (SHG) and the needy population of the rural areas.
• It also monitors and controls the cooperative banks and RRBs to support rural financing and needy farmers

Conclusion

NABARD has been instrumental in shaping modern India through the development of rural areas. It has been shaping the problems faced by the rural population and also helped them in earning a livelihood and betterment of the rural economy. It has connected both the rural and national economy and collaborated both. It currently works with close to 4500 partner companies who are the leading innovators and major players in various rural projects.

Important Features

1. NABARD contact details-
   • Tel. :- (91) 022-26539895/96/99 ,  E-mail :- [email protected]
2. Address – Plot C-24, G Block, Bandra Kurla complex, BKC Road, Bandra East, Mumbai, Maharashtra 400051
3. Web links- https://www.nabard.org/content.aspx?id=571

Introduction

Starting a business is not possible without hard work and investment. There is a lot of responsibility, work, long hours, investment, and stress involved. But the rewards are amazing. If you are trying to enter the warehouse business, two things you must care about are –

This industry is highly competitive, but that’s exactly what makes it so profitable.
Let’s first know exactly what a warehouse is? After this, we will talk about the below points:

• Checklist
• Profit Calculations
• Subsidy from Government
• Loan from Banks
• Other important topics about the business.

So, a warehouse is basically a building for storing goods. Warehouses are used by manufacturers, importers, exporters, wholesalers, transport businesses, customs, etc. Stored goods can include any raw materials, packing materials, spare parts, components, or finished goods associated with agriculture, manufacturing, and production. Example of warehouse:

Seems similar to godown? Is it?

No, they are different. A Godown is an unorganized form of the warehouse, it is of Indian origin, and it’s personal in terms of the store like one retailer store has its own godown, and any place can be converted to godown for storing products. Example of a godown:

You would like to obtain some initial background information about the warehousing industry before starting your venture.

Estimating the need

To start a warehouse, the first thing is to estimate the need. So, these are required to be done:

• Determine the demand – First of all, you need to determine the demand of warehouses in your area whether they could be Government, Private Companies, your own requirement, etc.
• Determine the Location – For the warehouse you have to be careful about its location. Location is the primary factor of its demand by any institution. Normally it should be within 10 km from Railway station, airports, and seaports where goods can be loaded and unloaded easily.
• Determine the size –Size of warehouse depends upon demand and space available. Although the ideal size of a single warehouse is 25000 sq.      ft. which could be made without any pillar in the center. This will avoid obstruction to plying loading vehicles.
• Lookout the Competition – You must watch demand and supply in your area.
• Estimate Start-Up Costs – Estimation of cost and availability of finance you must ensure based upon Land availability, Landfill cost, clear road for maneuvering loaded vehicles, Security of space, connectivity with the main road, and construction work.
• Explore Financing Options – Many Govt. and Private sector banks are giving loans nowadays for warehouses.
• Get Licenses – Must seek licenses applicable as per your state government rules of licensing for warehouse. Without proper licenses, companies will deny to take on lease.
• Hire Contractors – Then you can hire specialist contractors who are mastered in building warehouses – This will ensure your quality of construction and life of the warehouse.
• Hire Employees – Then hire employees like security guards for safety, Loader/un-loader, accountant, etc.
• Build a Client Base – Actually, this is the first thing required and could be based on the demand of the warehouse.

Major things to be taken care of before starting the warehouse work

• Maximum use of space
• Ready access to all items
• Efficient movement of goods
• Effective utilization of labor & equipment’s
• Maximum protection of items
• Good-house-keeping

Cost of Construction

Warehouses construction is based on the type of building you prefer. It could be

1. Steel structures (PEB)
2. Reinforced concrete structures (RCC)

Mostly PEB structure is preferred for warehouse because it is fast in erection and it is durable. For future extension it is very easy to be extended. As per the requirement the PEB structure is designed and the casting is done in a factory and erection is made on the site. Generally PEB structure construction starts at INR 1000/sq. ft. to INR 1200/sq. ft. The foundation work, the major part with RCC other than that the erection can be done fast and handed over.
For RCC it will cost roughly from 1500/sq. ft. to 1600/sq. ft. Columns can be built till the required heights and the roofing can be of galvanized sheets industrial grade with all ventilation and ridges and all.

In addition to this cost also depends on-

• Kind of structure are you willing to build
• Built-up area planned
• Locality i.e. rural or urban
• Construction work by self or giving it to some company
• Material costs are varying, so selecting the options also matters
• Demand and supply of labour and material matters

Estimated Return from a warehouse

So, let’s say you have Rs.50 Lacs to spend for a warehouse. As per bank loan norms you can get 75% loan i.e. 1.5Cr assuming commercial financing with 25% down.
Let’s say that you can purchase a warehouse @3000/sf., so you end up with a 6667sf warehouse to rent.
If you can rent the warehouse at @35/sf./month, you’ll have a gross income of Rs.2, 33,333/month or Rs.28 Lacs/year.

The calculation for 1st year looks like

Pretty good return. Your numbers may vary, so plug them in and see what you come up with. If you can’t gross at least 10% in your first year, you probably need to look for a better investment.

Loans and subsidies

Subsidies are provided by NABARD under the Gramin Bhandaran Yojana Scheme to the farmers on the submission of the project file from the different affiliate banks. The details of subsidies can be found here – Loans and subsidies for warehouse in India