Agricultural Finance in India: Experience and Lessons

The Paper traces the evaluation of agricultural credit in India. The first attempt at institutional changes in agriculture saw the establishment of special funds under the RBI and formation of co-operative credit societies. Then came nationalisation of commercial banks and concepts of priority sector lending. Targeted lending along with subsidized interest rate charged by the NABARD characterised this phase. Institutional framework undergoes a dramatic change since the nineties when decentralization occupies the centre stage. Micro credit societies and SHG-bank tie up assume the role of feeder canals of finance in agriculture.