Impact of institutional agriculture credit on profitability of paddy (original) (raw)
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A Study on Trends and Impact of Agricultural Credit in India
Advances in Life Sciences, 2016
Credit is one of the critical inputs for agricultural development. It capitalizes farmers to undertake new investments and/or adopt new technologies. Realizing the importance of agricultural credit in fostering agricultural growth and development, a study has been conducted to analyse the trends and impact of agricultural credit in India. The study was conducted based on secondary data collected from various sources such as government websites, annul reports of NABARD, Indiastat etc. The data were analysed using various techniques such as compound annual growth rate, standard deviation, instability index, analysis of variance and simple regression analysis. The study revealed that in the production credit (short term credit), highest compound annual growth rate was showed for commercial banks (25.66%) and in the case of medium term or long term loans for agriculture, regional rural banks showed a higher rate of growth with 17.74 per cent. The commercial banks are the major providers of agricultural credit at the ground level with a contribution 71 per cent. The ANOVA (single factor) results revealed that there is significant difference between the mean values of loans issued and loans outstanding among cooperative banks, commercial banks and regional rural banks. The simple linear regression analysis also depicted that agricultural credit has significant contribution in the agricultural GDP of the country and also on the agricultural exports from India.
Agriculture is the backbone of Indian economy. So it has all along been treated as a priority sector for the allocation of the institutional credit. The agricultural credit, particularly the institutional credit, has been to play a significant role in the agricultural development of India. Various institutional agencies are engaged in the payment of credit to agricultural sector i.e. scheduled commercial bank, regional rural banks, co-operative credit societies, co-operative banks etc. with their vast network, wider coverage and outreach extending to the remotest part of the country, the co-operative credit institutions, both in short and long term structure are the main institutional mechanism for dispensation of agricultural credit. An attempt has been made in the present paper to analyze the position of agricultural credit in India.
Institutional credit and rice productivity: a case study of District Lahore, Pakistan
Purpose -The purpose of this paper is to analyze how institutional credit affected the productivity of rice crop in District Lahore, Punjab Pakistan. Design/methodology/approach -For this purpose, stratified random sampling technique was adopted to select the sample respondents. The district was divided into three strata; from each stratum two villages were randomly selected and from each village ten loanee farmers were randomly selected from the given list of borrowers. An equal number of non-loanee farmers were also selected. Cobb Douglas function was used to calculate the impact of credit on rice productivity. Findings -The coefficient of credit was significant, which indicated that credit has a positive impact on the productivity of rice, providing a clue that credit is an important tool for improving and increasing the agricultural productivity in general and that of rice in particular. Originality/value -The paper will be an important addition to the literature in the current credit impact studies and will help especially the agricultural planners who are responsible for allocating funds for the agricultural sector in general and for the rice sector in particular. The paper's recommendations will help mitigate the problems of the farming community, especially of the small farmers in securing the institutional credit.
Indian Journal Of Agricultural Research, 2015
Institutional banking system in India is strengthened through nationalization of banks and many innovative initiatives such as Self Help Group (SHG) - Bank Linkage Programme, Kisan Credit Card (KCC) Scheme and Financial Inclusion. However, many studies conducted in Tamil Nadu, have pointed out several issues such as inadequacy of crop loan amount owing to lower scale of finance and minimum focus on long term agricultural advances that are hampering the banking services directed towards agricultural development. In order to address these issues, an attempt was made in the present study to assess the causes for and consequences of credit gap in the disbursement of short term / crop loan to the sample farm households; Results of the study indicated that the credit gap I (Credit requirement - Scale of finance) and Credit Gap-II (Credit Requirement - Credit Sanctioned) per ha of paddy were lesser in ST borrower farms, which indicted that though the scale of finance for paddy has been fix...
Challenges of Agriculture Credit in India
International Education and Research Journal, 2020
Agriculture plays a significant role in the Indian economy and provides employment and livelihood to a large section of the Indian population. Approximately 44% (as per ILO estimate of 2018) of the working population is employed in agriculture and allied sector. However, the contribution of agriculture to GDP has been declining from 52% in the 1950s to 30% in the 1990s and further below 20% from 2010 onwards as per data from Ministry of Statistics and Programme Implementation (MoSPI). In 2018-19, the share of Agriculture & Allied Gross Value Added (GVA) in overall GVA was 16% (Ministry of Agriculture and Farmers' Welfare (MoA&FW) Annual Report 2018-19). Economic Survey 2018-19 suggests that the growth rate in GVA (at 2011-12 prices) over past five-six years has been higher for livestocks, fishing and aquaculture as compared to crops. Allied activities contribute approximately 40% to agricultural output, whereas only 6-7% of agricultural credit flows towards allied activities. De...
Agriculture Credit in India: An Analytical Study
This paper examines the concerns and issues in agricultural credit in India. The analysis states that the credit delivery to the agriculture sector continues to be insufficient. It appears that the banking system is still hesitant on various grounds to provide credit to small and marginal farmers. Transformation in banking policies and practices and the resultant of and access to total bank credit during the post-bank nationalization period have not satisfactorily addressed equitable and efficient delivery of agriculture and rural credit. Due to declining in public capital formation in the rural and agriculture sector and the persistent unenthusiastic attitude of rural bankers towards formal financing, the planners and policymakers are believe on microfinance to suitably supplement formal banking in rural India.
A study on institutional credit to agriculture sector in India
2013
The institutional credit has been conceived to play an important role in the agricultural development of India. A large number of institutional agencies are involved in the disbursement of credit to agriculture. However, the persistence of money lenders in the rural credit market is still a major concern. In this backdrop, the present study has assess the quantum of loans issued and outstanding by institutional agencies and to examine the progress of Scheduled Commercial Banks in supplying agricultural credit in India. The relevant information was gathered through secondary data and compound growth rate were used for the analysis of data. The study reveals that the highest increase in loans issued was in the case of Scheduled Commercial Banks while the lowest was in the case of Co-operatives on the other hand the total number of account holders in scheduled commercial banks has increased from 5,841 to 30,538, whereas the amount of finance increased from 14,516 to 2,71,670 in the ref...
The productivity of agricultural credit in India
Agricultural Economics
This study examines the nature of the relationship between formal agricultural credit and agricultural GDP in India, specifically the role of the former in supporting agricultural growth, using state level panel data covering the period 1995-96 to 2011-12. The study uses a mediation analysis framework to map the pathways through which institutional credit relates to agricultural GDP relying on a control function approach to tackle the problem of endogeneity. The findings from the analysis suggest that over this period, all the inputs are highly responsive to an increase in institutional credit to agriculture. A 10 % increase in credit flow in nominal terms leads to an increase by 1.7% in fertilizers (N, P, K) consumption in physical quantities, 5.1% increase in the tonnes of pesticides, 10.8% increase in tractor purchases. Overall, it is quite clear that input use is sensitive to credit flow, whereas GDP of agriculture is not. Credit seems therefore to be an enabling input, but one whose effectiveness is undermined by low technical efficiency and productivity. Notwithstanding these aggregate findings detailed microstudies would be necessary to provide insights into this issue.