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Productivity of Agricultural Credit in India: Assessing the Recent Role of Institutional Credit to Agriculture in India using State Level Data

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  • Sudha Narayanan

Abstract

the study has been able to highlight the increasing role that agriculture credit is playing in supporting agriculture production in recent times- credit accounted for 16% of the total value of paid out inputs in the triennium ending (TE) 1998-99, and by the end of the decade, in TE 2011-12, it had risen to as high as 80.3% of the total paid out costs of inputs. Based on a State level panel data, the study has estimated the credit elasticity of agricultural GDP for the period 1995-96 to 2011-12 at 0.21, i.e. a 10% increase in institutional credit flow to agriculture in current prices is associated with a 2.1% increase in agricultural GDP the following year, expressed in current prices. However, disaggregating the period into two i.e., 1995-96 to 2003-04 and 2004-05 to 2011-12 indicates that the elasticity has weakened in the latter period in comparison to the former. [Occasional paper-61].

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  • Sudha Narayanan, 2016. "Productivity of Agricultural Credit in India: Assessing the Recent Role of Institutional Credit to Agriculture in India using State Level Data," Working Papers id:11195, eSocialSciences.
    • Handle: RePEc:ess:wpaper:id:11195
    Note: Institutional Papers
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    References listed on IDEAS

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    1. Rada, Nicholas E., 2013. "Agricultural Growth in India: Examining the Post-Green Revolution Transition," 2013 Annual Meeting, August 4-6, 2013, Washington, D.C. 149547, Agricultural and Applied Economics Association.
    2. Shawn Cole, 2009. "Fixing Market Failures or Fixing Elections? Agricultural Credit in India," American Economic Journal: Applied Economics, American Economic Association, vol. 1(1), pages 219-250, January.
    3. Robin Burgess & Rohini Pande, 2005. "Do Rural Banks Matter? Evidence from the Indian Social Banking Experiment," American Economic Review, American Economic Association, vol. 95(3), pages 780-795, June.
    4. Sriram M S, 2007. "Productivity of Rural Credit: A Review of Issues and Some Recent Literature," IIMA Working Papers WP2007-06-01, Indian Institute of Management Ahmedabad, Research and Publication Department.
    5. Kanz, Martin, 2012. "What does debt relief do for development ? evidence from India's bailout program for highly-indebted rural households," Policy Research Working Paper Series 6258, The World Bank.
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