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Economic Development Activities in India

Federations of farmers groups have considerably reduced agriculture input costs (seeds, fertilisers and pesticides) through bulk purchases based on demand from member institutions.Economic development activities in India range from microfinance to corporate banking and financial services. A wide range of microfinance programmes are part of the Aga Khan Rural Support Programme. With the help of the Aga Khan Fund for Economic Development (AKFED), small community-based co-operative societies have grown into the Development Credit Bank (DCB).

Banking and Financial Services
Long-held traditions of self-help gave impetus to small community-based co-operative societies that have evolved, with the help of the Aga Khan Fund for Economic Development (AKFED), into small co-operative banks, which then merged to form the Development Co-operative Bank, and eventually metamorphosed during the 1990s into the Development Credit Bank (DCB).

From its origins in small institutions addressing the needs of underserved communities, especially in the co-operative sector, DCB has emerged as a fully fledged commercial bank providing advanced corporate finance services at one end of the spectrum while continuing to service the needs of co-operative society borrowers.

The Aga Khan Fund for Economic Development (AKFED) is the single largest stakeholder in the Bank. The Fund holds a stake of 49% in the Bank. The AKFED promotes private sector initiatives and entrepreneurship through equity investment, in partnership with multilateral agencies, international investors, local development institutions and individuals.

AKFED also had a vital role in facilitating finance for home ownership by playing an instrumental role in the launch of the Housing Development Finance Corporation Limited (HDFC) in the mid 1970s.

Microfinance
As part of the Aga Khan Foundation's rural development activities, community organisations work to set up independent means of sustaining themselves, which is usually achieved through micro-credit schemes. For example, a women’s federation in Bharuch district in Gujarat state recently accessed a loan-based scheme for animal husbandry. Likewise, federations of farmers groups have considerably reduced agriculture input costs (seeds, fertilisers and pesticides) through bulk purchases based on demand from member institutions, simultaneously ensuring the quality of inputs supplied. For more information, please see the Rural Development page.

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