Priyanka Kakodkar

small_screen_shot_2015-04-23_at_12.06.48_pm.png

thumbnail_screen_shot_2015-04-23_at_12.06.48_pm.png

screen_shot_2015-04-23_at_12.06.48_pm.png

MUMBAI: At the RBI&#39;s 80th anniversary recently, PM Narendra Modi had invoked farmers&#39; suicides to urge banks to lend more to cultivators. &quot;When a farmer dies, does it shake the conscience of the banking sector? He faces death because he has taken loans from a moneylender,&quot; Modi said. Credit to the farm sector has risen across the country over the last decade. Yet, in Maharashtra, which reports the highest number of farmers&#39; suicides in the country, the bulk of farm loans, ironically, does not go to farmers, says a new study based on the central bank&#39;s data.
 
 Although the majority of farmers live in rural areas, a larger portion (44%) of agricultural loans are supplied by urban and metropolitan branches of scheduled commercial banks than rural branches, which supply almost 30%.
 
 The study by economists R Ramakumar and Pallavi Chavan is based on data from the RBI&#39;s report, Basic Statistical Returns of Scheduled Commercial Banks in India, for 2013.
 
 In effect, loans to farmers are not driving the rise in agricultural credit. Instead, the major beneficiaries in the revival of farm credit in this decade are agri-businesses and corporates involved in agriculture, the authors say. This is because the definition of agricultural credit has been expanded to include these businesses. &quot;The definition now includes loans to corporate and agri-business institutions as well as storage equipment in cities. It also includes loans for commercial and export-oriented agriculture,&quot; says Ramakumar, an economist with the Tata Institute of Social Sciences, Mumbai.
 
 The growth in agricultural credit has also been fuelled by a rise in indirect loans, the study says. Direct loans are given to farmers while indirect loans are given to institutions indirectly involved in agricultural production.
 
 Significantly, the share of credit to small and marginal farmers has dropped dramatically across the country, the study shows. Instead, loans of Rs 1 crore and above are driving the revival of agricultural credit, the study says.
 
 The share of direct agricultural loans worth less than Rs 25,000 to marginal farmers from scheduled commercial banks has fallen sharply-from almost 23% in 2005 to just 4.3% in 2013. On the other hand, the share of direct agricultural loans worth over Rs 1 crore has risen from 7.5% in 2005 to10% in 2013.
 
 &quot;The 1990s were the lost decade in rural banking. There was large-scale closure of commercial banks in rural areas,&quot; says Ramakumar. Since 2000, there has been a growth of agricultural credit, but a major part of this growth is illusory, he says. &quot;It is driven by the expansion of funding to corporate and agri-business institutions involved in agriculture, high-value loans and credit from urban and metropolitan branches,&quot; he says.
 
 
 Report 10: The
 <a href="http://timesofindia.indiatimes.com/india/Study-Agri-corporates-not-farmers-hog-loans/articleshow/46893202.cms?intenttarget=no">
 original version of this story
 </a>
 appeared in The Times of India on 12 Apr 2015
 
 
 
 More in this series:
 
 
 Report 1:
 <a href="https://ruralindiaonline.org/articles/nearly-80000-homeless-elders-go-hungry/">
 Nearly 80000 homeless elders go hungry
 </a>
 
 Report 2:
 <a href="https://ruralindiaonline.org/articles/drought-hits-90-lakhs-farmers-in-maharashtra/">
 Drought hits 90 lakhs farmers in Maharashtra
 </a>
 
 Report 3:
 <a href="https://ruralindiaonline.org/articles/kharif-crops-hit-by-drought-pulses-take-a-maha-pounding/">
 Kharif crops hit by drought pulses take a maha pounding
 </a>
 
 Report 4:
 <a href="https://ruralindiaonline.org/articles/40-rise-in-farmer-suicides-in-maharashtra/">
 40% rise in farmer suicides in Maharashtra
 </a>
 
 Report 5:
 <a href="https://ruralindiaonline.org/articles/bitter-harvest-where-villagers-dig-for-hours-to-fill-a-pot/">
 Bitter Harvest - Where villagers dig for hours to fill a pot
 </a>
 
 Report 6:
 <a href="https://ruralindiaonline.org/articles/drought-migration-forces-aged-to-toil-as-farm-hands/">
 Drought migration forces aged to toil as farm hands
 </a>
 
 Report 7:
 <a href="https://ruralindiaonline.org/articles/the-man-with-48-borewells-in-drought-hit-marathwada/">
 The man with 48 borewells in drought-hit Marathwada
 </a>
 
 Report 8:
 <a href="https://ruralindiaonline.org/articles/maharashtras-drought-hit-farmers-without-bank-accounts-denied-aid/">
 Maharashtra&#39;s drought-hit farmers without bank accounts denied aid
 </a>
 
 Report 9:
 <a href="https://ruralindiaonline.org/articles/maharashtra-govt-says-mulling-farmer-insurance-as-opposition-cites-tois-suicide-reports/">
 Maharashtra govt says mulling farmer insurance as opposition cites TOI’s suicide reports
 </a>
 
 Report 11:
 <a href="https://ruralindiaonline.org/articles/direct-loans-below-rs-25000-to-farmers-plunge-to-43-from-23/">
 Direct loans below Rs 25,000 to farmers plunge to 4.3% from 23%
 </a>
 
 Report 12:
 <a href="https://ruralindiaonline.org/articles/only-12-potential-of-maharashtras-70000-small-dams-used/">
 Only 12% potential of Maharashtra’s 70,000 small dams used
 </a>
 
 Report 13:
 <a href="https://ruralindiaonline.org/articles/unseasonal-rain-601-farmer-suicides-in-maharashra-in-just-3-months/">
 Unseasonal rain: 601 farmer suicides in Maharashra in just 3 months
 </a>
 
 Report 14:
 <a href="https://ruralindiaonline.org/articles/only-3-maharashtra-farmers-ended-life-due-to-unseasonal-rain/">
 &#39;Only 3 Maharashtra farmers ended life due to unseasonal rain&#39;
 </a>
 
 Report 15:
 <a href="https://ruralindiaonline.org/articles/state-governments-logic-for-its-low-farmer-suicide-count-only-3-blamed-rains/">
 State government&#39;s logic for its low farmer suicide count: Only 3 blamed rains
 </a>
 
 Report 16:
 <a href="https://ruralindiaonline.org/articles/beef-banned-but-no-state-run-cow-shelters-in-sight/">
 Beef banned, but no state-run cow shelters in sight
 </a>

Study: Agri-corporates, not farmers, hog loans

Mumbai

At present, we can only accept donations in Indian rupees by Indian citizens. All donations made to the CounterMedia Trust are eligible for exemption under Section 80G of the Income Tax Act, 1961. Here is a copy of our exemption certificate.


India is bigger than New Delhi. And people need to know more about the rest of this vast nation.


Younger, media-saturated generations are growing up knowing little about their country, but a lot about the elites of a few metros and towns. For a narrowly-owned, commercially-driven media, the dumbing down of a nation is part of standard operating procedure. The last available data of the Centre for Media Studies (CMS, Delhi) show us that reports from New Delhi account for 66 per cent of news on the front pages of major dailies. The CMS data also found that just about 0.24 per cent of front page news came out of rural India. The TV channels are not much better.PARI exists to change that.We are a non-profit organisation. We publish under creative commons, and do not charge readers a subscription fee or put-up advertisements. Nothing is behind a paywall and we are completely free-to-access by anyone. We guard our independence and receive no direct grants from governments and corporations, nor any funding that could dictate our content. So, we are dependent on volunteer labour, donations from individuals, foundations and institutions that see value in independent and free media.PARI is changing the way Indian journalism reports and documents the rural.India is more than the elite of a few metros and towns. We report on rural lives and livelihoods, languages, communities, migrants and more. We need your help to pull off this most ambitious of Indian journalistic endeavours. The scale of this effort costs money. Donate generously - and spread the word about PARI.&nbsp;

Donate FAQs


Let’s get you acquainted

Welcome to PARI

All our content is, and will forever be free to consume. If you enjoy our work, you can support us by becoming a volunteer or by donating to help fund our work.

Want to republish this article? Please write to <a href="mailto:zahra@ruralindiaonline.org" target="_blank" rel="noopener noreferrer">zahra@ruralindiaonline.org</a> with a cc to <a href="mailto:namita@ruralindiaonline.org" target="_blank" rel="noopener noreferrer">namita@ruralindiaonline.org</a>

Study: Agri-corporates, not farmers, hog loans

The bulk of farm loans do not go to farmers. As high a share of 44 per cent of ‘agricultural loans’ in Maharashtra are disbursed from urban and metropolitan branches of scheduled commercial banks than rural branches, which supply almost 30%.

Related stories

A rain-scented walk in Sivagangai

Living on ravaged land

Biswas and the bamboos on his bike

Recycling energy, Godda style

Bhadels of Goa

Pookadai: still throbbing with morning life

Koli Kadlas

Malnourishment high among children of migrants: study

Wheels of the rural Indian West

Living Under a Red Cloud in Bellary

Vedla – earrings of the Maher community

Dreaming of water, drowning in debt

Kali: the dancer and his dreams

Farmer's diet worse than a convict's

In Yavatmal, life goes on

Suicides are about the living, not the dead

Death of a carpenter

Hoisa Shigmo!

Women farmers: weaving a life in Anantapur

Defiant in Dhinkia

Spice and all that's nice

Kerala's Green Army

The ‘jugaad’ not-a-mobile

Health as someone else's wealth

Calibrating in a Kudumbashree assembly unit