Examining institutional credit access among agricultural households in Eastern India: trends, patterns and determinants
ISSN: 0002-1466
Article publication date: 3 October 2020
Issue publication date: 15 March 2021
Abstract
Purpose
This paper is an attempt to understand the pattern of credit among agricultural households in Eastern India and to identify the correlates of their access to institutional credit for policy imperatives.
Design/methodology/approach
The study uses unit-level data from the All-India Debt and Investment Survey of the 59th and 70th rounds of the National Sample Survey Office for the years 2002–2003 and 2012–2013. Cragg's double-hurdle model and the Heckman selection model are used to estimate the determinants of access to and the amount of institutional loans taken by households. These models also account for potential selection bias in the findings.
Findings
The study reveals that access to credit is strongly associated with the socioeconomic and demographic characteristics of agricultural households. However, about half of the farmers in the eastern states of India lack access to institutional credit despite the government's attempts to include them in the ambit of formal financial services. Thus, strategies for developing agriculture in Eastern India must include efforts to bring small and marginal farmers under the coverage of institutional credit.
Research limitations/implications
These data are based on the responses given by the sample households and not the experimental data. The data pertain to the year 2013.
Originality/value
The findings emphasize that strategies for developing agriculture in Eastern India must give special push to enhance small and marginal farmers' access to institutional credit.
Keywords
Acknowledgements
The authors are grateful to the Indian Council of Agricultural Research (ICAR) for extending financial support to conduct this study. Any opinions, findings, conclusions or recommendations expressed within this paper do not necessarily reflect the views of the ICAR, IFPRI or any other organizations.Conflict of interest statement: We hereby declare that there is no conflict of interest in publication of this research paper.
Citation
Kumar, A., Das, R., K S, A., Bathla, S. and Jha, G.K. (2021), "Examining institutional credit access among agricultural households in Eastern India: trends, patterns and determinants", Agricultural Finance Review, Vol. 81 No. 2, pp. 250-264. https://doi.org/10.1108/AFR-04-2020-0054
Publisher
:Emerald Publishing Limited
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