Incidence and Determinants of Indebtedness of Agricultural Households in Gujarat

Amidst the scenario of distress among agrarian community it is very important to discuss farmers indebtedness. Most of the studies in India revealed that indebtedness of farm households is one of the crucial factors responsible for crisis. This paper examines the nature and determinants of farmer's indebtedness using unit record data from NSSO 70^th round in Gujarat state. Incidence of indebtedness was studied using tabular and percentage analysis, while determinants were assessed using binomial logistic regression model. It was found that, the incidence of indebtedness was higher in agricultural households with large land holding size as compare to their counterparts with less land holding. Incidence was higher in non-SC/ST households than that of SC/ST households. There is ample scope for financial inclusion in South Eastern region of the state as non-institutional sources of credit were found more active. Households having cultivation as primary source of income were more likely to be indebted. MGNREGA job card holders also found more likely to become indebted. Thus, government should interfere in order to make hassle-free credit availability to the marginalized farm households for their livelihood security in the state.

The present study made efforts to evaluate the incidence of indebtedness among various categories of agricultural households in order to bring in light the comparison in financial obligations among them. It may help the policymakers to relook in the credit advancement policies to make it better.