“NEED FOR AGRICULTURAL CREDIT”

By

Utkarsh – 2014133

Sonam Modani – 2014120

5 Year Integrated B.A., LL.B. (Hons.) Course

LAW AND AGRICULTURE

Under the supervision of

Dr. K. Sudha

DAMODARAM SANJIVAYYA NATIONAL LAW UNIVERSITY

NYAYAPRASTHA “, SABBAVARAM, VISAKHAPATNAM-531035
ANDHRA PRADESH, INDIA

05/11/2018

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 CERTIFICATE

This is to certify that the dissertation entitled “NEED FOR AGRICULTURAL CREDIT” for
the Seminar Paper LAW AND AGRICULTURE to Damodaram Sanjivayya National Law
University, Visakhapatnam is a record of original work done by Mr. Utkarsh Mishra &
Ms.Sonam Modani under my supervision and guidance to my satisfaction.

SIGNATURE OF THE GUIDE

Visakhapatnam

Date:

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 ACKNOWLEDGEMENT

We are using this opportunity to express our gratitude to everyone who supported me throughout
the course of this Dissertation. We are thankful for their aspiring guidance, invaluably
constructive criticism and friendly advice during the project work. We are sincerely grateful to
them for sharing their truthful and illuminating views on a number of issues related to the
project.

We express our warm thanks to Dr. K. Sudha for her support and guidance at Damodaram
Sanjivayya National Law University.

Thank you,

Utkarsh Mishra

Sonam Modani

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List of Abbreviations

AAGR – Average Annual Growth Rate

ATM – Automatic Teller Machine
ACD – Agriculture Credit Department
ACRC – Agriculture Container Recycling Council
AFC – Agricultural Finance Corporation
AGDP – Average Goss Domestic Product
ARDC – Agriculture Refinance Development Corporation
ARSC – All India Rural Survey Committee
ANBC – Adjusted Net Bank Credit
ANBC – Adjusted Net Bank Credit
CAGR – Compound Average annual Growth rate
CAMEL – Credit Assets Management and Liquidity
CMIE – Centre for Monitorising Indian Economy
CSO – Central statistical Organization
CB – Commercial Banks
CC – Cash Credit
CCS – Cash Credit System
CDR – Credit Deposit Ratio
CRDF – Cooperative rehabilitation and Development Fund
CRR – Cash Reserve Ratio
DCCB – District Central Co-operative Bank
DRDA – District Rural Development Agencies
EPWRF – Economic and Political Weekly Research Foundation
FFI – Formal Financial Institutions
FSS – Farmers Service Society
GDP – Gross Domestic Product
GIC – General insurance Company
GLC – Ground Level Credit
GoI – Government of India
HRD – Human Resource Development
IRDP – Integrated Rural development Program
KGK – Krishi Gyan Kendras
KCC – Kisan Credit Card
LDB – Land Development Banks
LPG – Liberalization, Privatization, and Globalization
MFI – Micro Finance Institutions
MIS – Management Information System
MSP – Minimum Support Worth
MYRADA – Mysore Resettlement and Development Agency
MFI – Micro Finance Institutions
NCAER – National Council of Applied Economic Research
NCA – National Commission on Agriculture
NDC – National Development Council

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NIBM – National Institute of Banking Management
NUC – National Union of Cooperatives
NSSO – National Sample Survey Organization
NAS – National Accounts Statistics
NABARD – National bank for agriculture and Rural Development
NGO – Non Government Organizations
NNDB – National Dairy Development Board
NPA – Non Performing Assets
OD – Over Draft
PSB – Public Sector Banks
RBI – Reserve Bank of India
RFI – Rural Finance Institutions
RRB – Regional Rural Banks
SB – Savings Bank
SBLP – Self Help Group Bank linkage program
SIS – Situation Assessment Survey
SCB – Scheduled Commercial Banks
SFDA – Small Farmers development agency
SGSY – Swarnajayanthi Gram Swarojkar Yojana
SHG – Self Help Group
SLBC – State level Bankers Committee
SOF – Scales of Finance
UT – Union Territories

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 ABSTRACT

The institutional credit has been conceived to play a pivotal role in the agricultural development
of India. Many 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 examines the performance of agricultural credit flow and has
identified the determinants of increased use of institutional credit at the farm household level in
India. The study based on the secondary data compiled from several sources, has revealed that
the institutional credit to agriculture in real terms has increased tremendously during the past-
decades. The structure of credit outlets has witnessed a significant change and commercial banks
have emerged as the major source of institutional credit in recent years. Credit is one of the
critical inputs for agricultural development. It capitalizes farmers to undertake new investments
and/or adopt new technologies. The importance of agricultural credit is further reinforced by the
unique role of Indian agriculture in the macroeconomic framework along with its significant role
in poverty alleviation. Realizing the importance of agricultural credit in fostering agricultural
growth and development, the emphasis on the institutional framework for agricultural credit is
being emphasized since the beginning of planned development era in India.

Keywords – Agricultural Credit, Agriculture Sector, Rural Development

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