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The unorganised sector and access to finance in rural India

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  • Kar, Saibal
  • Dutta, Meghna

Abstract

A large number of studies have predominantly focused on the urban informal manufacturing sector broadly classified as the NDMEs and OAMEs. However, their rural counterparts, despite covering two-thirds of the units overall, are often neglected. These organizations suffer largely from lack of access to formal credit. This chapter offers an in-depth analysis of the access to finance by rural unorganised sectors in comparison to the larger agricultural sector. We also provide a sector-wise and state-wise analysis of volatility of gross value added and fixed assets for various industries within the realm of the rural unorganised sector in India. Finally, we discuss the role of micro-credit organizations in linking the formal credit agencies to the unorganised units in rural India.

Suggested Citation

  • Kar, Saibal & Dutta, Meghna, 2014. "The unorganised sector and access to finance in rural India," MPRA Paper 103449, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:103449
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    File URL: https://mpra.ub.uni-muenchen.de/103449/1/MPRA_paper_103449.pdf
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    References listed on IDEAS

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    1. Foster, Andrew D & Rosenzweig, Mark R, 2004. "Agricultural Productivity Growth, Rural Economic Diversity, and Economic Reforms: India, 1970-2000," Economic Development and Cultural Change, University of Chicago Press, vol. 52(3), pages 509-542, April.
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    4. Mark M. Pitt & Shahidur R. Khandker, 1998. "The Impact of Group-Based Credit Programs on Poor Households in Bangladesh: Does the Gender of Participants Matter?," Journal of Political Economy, University of Chicago Press, vol. 106(5), pages 958-996, October.
    5. Coleman, Brett E., 1999. "The impact of group lending in Northeast Thailand," Journal of Development Economics, Elsevier, vol. 60(1), pages 105-141, October.
    6. Robin Burgess & Rohini Pande & Grace Wong, 2005. "Banking for the Poor: Evidence From India," Journal of the European Economic Association, MIT Press, vol. 3(2-3), pages 268-278, 04/05.
    7. Joseph P. Kaboski & Robert M. Townsend, 2005. "Policies and Impact: An Analysis of Village-Level Microfinance Institutions," Journal of the European Economic Association, MIT Press, vol. 3(1), pages 1-50, March.
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    Cited by:

    1. Meghna Dutta & Niladri Sekhar Dhar, 2021. "Property Rights Documentation in Determining Credit Availability for Informal Firms: A Study of Indian Firms," Journal of Quantitative Economics, Springer;The Indian Econometric Society (TIES), vol. 19(1), pages 123-138, March.
    2. Beladi, Hamid & Dutta, Meghna & Kar, Saibal, 2016. "FDI and Business Internationalization of the Unorganized Sector: Evidence from Indian Manufacturing," World Development, Elsevier, vol. 83(C), pages 340-349.

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    More about this item

    Keywords

    agriculture; unorganised manufacturing; access to credit; banks; India.;
    All these keywords.

    JEL classification:

    • G2 - Financial Economics - - Financial Institutions and Services
    • L6 - Industrial Organization - - Industry Studies: Manufacturing
    • R0 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General

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