Cabinet has approved proposal for amendments to the National Bank for Agriculture and Rural Development-NABARD Act, 1981. The amendments include provisions that enable Central Government to increase the authorized capital of NABARD from Rs 5,000 crore to Rs 30,000 crore and to increase it beyond this in consultation with RBI. <br/><br/>The amendments also include transfer of 0.4 percent equity of RBI in NABARD amounting to Rs 20 crores to the Government of India.<br/> <br/>The transfer of entire shareholding in NABARD held by RBI to the Central Government will remove the conflict in RBI's role as banking regulator and shareholder in NABARD. <br/> <br/>The proposed increase in the authorized capital would enable NABARD to respond to the commitments it has undertaken, particularly in respect of the Long Term Irrigation Fund and the recent cabinet decision regarding on-lending to cooperative banks. <br/><br/><br/>Further, it will enable NABARD to augment its business and enhance its activities which would facilitate promotion of integrated rural development and securing prosperity of rural areas including generation of more employment. <br/><br/>