Agriculture in India: Research, notes and projects

Agriculture in India (for School & College students). Find Research, notes, projects, case studies, and more, related to Agriculture and allied industries in India.

Top Government Schemes in Agriculture in India

The Government of India is fully aware of the problems faced by the agricultural sector in India and its importance to the economy.

In order to tackle the problems faced by the agricultural sector in India, the government has undertaken several initiatives and schemes.

Some of them are as follows:

More areas have been brought under cultivation and irrigation with the help of multipurpose projects.

Extensive electrification of villages have been carried out.

Better fertilizers are being made available to farmer for improving the quality of the soil and increasing the yield.

Loans are provided to farmers at low interest rates to buy tractors harvesters better agricultural tools and seeds.

Some of the schemes are:

• National Mission for Sustainable Agriculture (NMSA) which includes initiatives such as Rainfed Area Development (RAD)
• Pradhan Mantri Krishi Sinchai Yojana(PMKSY) which has components such as Accelerated Irrigation Benefit Programme(AIBP), Micro Irrigation and more.
• E-NAM (National Agriculture Market) is an electronic trading portal which plans to bring together all the APMC mandis to create a unified national market for agricultural commodities.

Website: Department of Agriculture and Farmers Welfare: Programmes, Schemes & New Initiatives

Sources of Agricultural Finance In India

Need for Agricultural Finance
People working in the agricultural segment may need finance for various reasons:

• Short term loan
• Medium term loan
• Long term loan

Sources of Agricultural Finance

Here are the more common sources of Agricultural Finance in India

Institutional Sources

• Cooperative Credit societies (Primary Agricultural credit societies, Central Co-operative Bank, state Co-operative Bank)
• Commercial Bank
• Regional Rural Banks (RRB)
• NABARD

Non-Institutional Sources
Money lenders, Traders, Landlords

Co-operative credit societies

This is the cheapest source, these provide short term as well as long term loans.

• Primary Agricultural credit societies at village level
• Central co-operative Bank at District level
• State co-operative Bank at state level

Achievements:
Share of co-operative s in total credit to the agricultural sector has increased from 3 % in 1951 to 27% in 2002. but again declined to 15.7 % in 2010-11. Good progress in T.N, Andhra Pradesh, Karnataka, Punjab & Himachal Pradesh

Problems: High level of Over dues. Poor recovery. Huge loss-reduces capacity to give loan. Poor management. Benefited rich farmers and land lords more than poor farmers.

Commercial Banks

Initially the contribution of commercial bank was very less. After nationalization of banks in 1969, contribution of banks to agricultural credit increased significantly. It provides Direct & Indirect finance. Direct finance for purchasing of pump sets, tractors, other agricultural machinery, construction of wells, tube wells and for other agricultural activities to farmers. Indirect finance is granted to co-operative societies, FCI, state Govt. and other agencies engaged in procurement, storage and distribution of food grains. It also provide credit through service units for warehousing, processing , marketing, transporting etc.

Achievements of Commercial Banks
Share in total rural credit increased from 0.9 % to 74.5%. Helped rural population to free themselves from the cluches of Money lenders. Helped farmers to use the modern methods of cultivation and improve their financial position.

Problems: Huge loss due to branch expansion. Cost of service increased with large no. of small borrowings. Problem of bad debt. Lack of coordination between the commercial banks, cooperative banks and RRB.

Regional Rural Banks (RRB)

5 RRBs set up in 1975 for weaker section of rural community. They give direct loans only to small and marginal farmers, agricultural laborers, rural artisans and small entrepreneurs to develop industry, trade and other productivity in rural areas. They are sponsored by a commercial bank which contributes to 35% of their share capital. Area of operation is limited to a specific region and few districts. Lending rates are low. Refinanced by NABARD.

Achievements of RRBs:
Helped needy poor people by providing loan at lowest cost. No. of RRBs increased from 5 to 196. In 2010-11 RRBs provided about 10 % of the Institutional credit to agricultural sector.

Problems: Controlled by many agencies central Govt., state Govt. and commercial banks. leads to delay in decision making. Recovery position is poor. Substantial loss. Lack of proper management. Defective lending policy.

NABARD

National Bank for Agriculture and rural development (NABARD) set up in 1982. it is a refinancing agency. During 2010-11 sanctioned Rs. 35,273 cr.

Functions:

1. As an apex institution it has to take care of financial requirement of agriculture and rural development.
2. Provide short term, medium term and long term credit to cooperatives, RRBs and commercial banks which are main sources of institutional credit.
3. It gives long term loan up to 20 years to state govt. to enable them to subscribe to the share capital of cooperative credit societies.
4. Direct and supervise the flow of credit to agriculture, a small scale industries, cottage and village industries, handicrafts and other economic activities in rural areas.
5. It maintains a Research and Development Fund to promote research in agriculture and rural development.
6. The Rural Infrastructure Development Fund(RIDF) was established in 1995-96 to finance infrastructure projects. The RIDF gives loans to state Governments for infrastructure projects such as irrigation, rural roads, rural bridges, watershed management, flood control, warehouses, cold storages, fisheries, forest development etc.
7. NABARD provides 100% refinance assistance to banks at low interest rates for financing self help groups.
8. It has introduced the Kisan Credit Card scheme in 1998-99 to provide short term credit to farmers. The scheme is implemented by commercial banks, RRBs and cooperatives. Today KCC has become very popular among farmers.
9. NABARD helps the RRBs and the co-operative banks to implement the Swarnajayanti gram Swarozgar Yojana.
10. It is responsible for conducting inspection of the cooperatives.

Useful Links

IBEF: Agriculture in India: Industry Overview, Market Size, Role in Development

Academic Questions

Find academic questions, project and assignment questions on Agriculture in India.

Question: Take a table of foodgrains production in India from any textbook on Indian economy or any other secondary source such as the Internet. Interpret the changes in the production over a given period of time.

Hints:

1. The best secondary source for the required data is Economic Survey of the Government of India. For example, Table 1.15 on page A35 of Statistical Table given at the end of Economic Survey 2017-18 gives data on production of major crops from 1980-81 to 2015-16.

2. You may also use Ministry of Agriculture and Farmers Welfare: Pocket Book of Agricultural Statistics, 2017, Section 4 and 5 of Statistical Tables. You may use these data to find out the long-term trend in the production of foodgrains as well as the yearly fluctuations (for the last 6 years) in the foodgrains production. You may identify the factors for the long-term increase in foodgrains production such as use of fertilisers, HYS, etc. You may also explain yearly fluctuations in terms of the nature of the monsoon—excessive rain or shortfall of rain. You may conduct such a study for the foodgrains production as a whole as well as for production of specific foodgrains like rice, wheat, pulses etc.

Question . The Farm Bill 2020 is a combination of three bills:

• a. Farmers’ Produce Trade and Commerce (Promotion and Facilitation) Bill,
• b. Farmers (Empowerment and Protection) Agreement on Price Assurance and
• c. Farm Services Bill and Essential Commodities (Amendment) Bill.

It is an attempt to implement a massive, far reaching and permanent structural change in the farm sector by the Government of India. The idea is to encourage corporate investments in agricultural ecosystem, to cut out the intermediary or middle-man so as to make agriculture more lucrative and financially viable for farmers – particularly the small farmers. However, fears over the genuineness of the intent behind the bill have led to widespread agitation and its rejection by several states. The Bill which has since become an Act of Parliament, has been seen in some quarters, to be a means of protecting the vested financial interests of the “dalal” or middle man at the cost of the cultivator.

• a. Examine the Farm Bill 2020 in the context of the state of the agricultural economy and the role the Agriculture Produce Market Committee system (APMC) plays in it.
• b. Appraise whether the entry of the corporate sector will spell the death knell to the APMC system – which for all its perceived drawbacks – is closely connected with the farming community.
• c. Assess what impact the Bill could have on banks, who, for decades have been close participants in the development of the agricultural sector. As bank branches provide critical financial services at APMC centres, what changes in their functioning do you see in the event of a possible decline or demise of APMCs?
• d. Indicate your stand on the issue – with valid reasons – as to whether the Farm Bill is a positive, progressive step forward that is intent on bringing in fairness and order into the agricultural sector or a development that is detrimental to the interests of small farmers.

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