A Study on Trends and Impact of Agricultural Credit in India

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, astudy 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 inthe 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.