A Study of Agricultural Credit Sources and its Utilization Pattern by Farmers in Selected Villages of Udaipur District

Abstract

Agriculture is the mainstay of the Indian economy engaging about 60 percent of the population, and contribution 16 percent of GDP. In fact, agriculture is the way of life, a tradition, which for centuries, has shaped the thought, the outlook, the culture and the economic life of the people of India (National Agriculture Policy, 2000). Agriculture sector in India is central to the socioeconomic life of the country for its multi-functionalities to provide employment, food, nutritional and ecological securities. That is why there is a need to focus on agriculture growth for national development.  It is needless to mention that adequate and timely finance is indispensable for agricultural development. Credit is indispensable for every sector of the economy to grow. It provides additional oxygen to breath for better health of the economy. Schumpeter referred to 'Credit' as a phenomenon of development and considered the banking system along with entrepreneurship as a key input in the process of development. The succinctly brings out the importance of credit an input in development. Though credit in every sector of the economy is indispensable yet its role in agriculture is crucial. Agricultural credit has played a great role in increasing the agricultural production and also to improve the standard of living of the rural population. In other words, agriculture credit may be defined as the amount of investible funds made available for farm business. In fact, it is a unique source since it provides the opportunity to use additional inputs and capital items now and to pay the cost from future earnings. This study explores the opinion of the farmers collected through survey in the sampled villages of Udaipur district of Rajasthan state. Part I of the paper deals with the structural features of respondents and part II with the utilization pattern and opinion of farmers regarding agricultural finance.