Causes and Consequences of Indebtedness: A Brief Review

The study aims to analyze the consequences of indebtedness and causal factors behind it. The major factors that lead to indebtedness are the instability in food grain production, net returns and the high cost of cultivation. The agricultural developed States are characterized by high incidence of indebtedness. Most of the indebted farmers belong to the small and marginal categories but the states where the degree of commercialization is high, the incidence of indebtedness is found high among the semi-medium and medium farmers. The present agricultural credit system is awful and the farmers are not getting the appropriate price for their produce. This situation demands urgent attention of the government, policy makers and planners to save the farmers from committing suicide and to re-boost the agricultural economy of the country.