Impact of Banking Sector Reforms on Agriculture and Sources of Agricultural Credit

Abstract

Agriculture industry plays an important role in the Indian economy and Banks can play an important role in bringing agricultural revolution, in removing indifference of wealth. Utilization of high technology and modern equipment in agriculture brings about production growth. Indian economy is emerging as one of the leading economies of the world which makes progress of agriculture sector very crucial. In an economy like India where agriculture is subsistence, Finance is considered as the basic ingredient for increase in agricultural productivity. Therefore, it becomes the main responsibility of the country is to provide strong support to this sector. Though impressive significant strides have been achieved in terms of spread network and outreach of institutions, the qualities of flow of financial resources to agriculture continue to be inadequate. The growth of agricultural credit in India depends mainly on Government intervention. Banking sector reforms directly affected the agricultural sector. This paper describes the effects of various banking sector reforms on agriculture and sources of agriculture credit.