Open Access
Subscription Access
Open Access
Subscription Access
Impact of Credit on Investment in Tissue Culture Banana Cultivating Farms
Subscribe/Renew Journal
Agriculture Credit became increasingly important especially when the cultivators adopt modern technology, huge farm investments which required more finance than the traditional method of farming. There should be a balance between investment credit along with production credit for agricultural growth. Less availability of production or investment credit adversely influences the adoption of new modern technology and agricultural investments, which in turn lowers the productivity and production, and also pushes the farmers to borrow from non-institutional sources. The study is based on primary data collected from a sample of farm households comprised of two different groups, namely (i) borrower, (ii) non-borrower. The borrowers where again classified into two groups, (i) Conventional variety of banana (Nendran, Kadali, and Poovan) growers, (ii) Tissue culture banana (G9) growers comprising of Short Term and Long Term loan borrowers. Under each of above categories, forty five sample farm households with a total of 180 samples respondents were surveyed. The impact of credit on farm investment was assessed by comparing the category of long term borrowers growing tissue culture growing farms with that of non-borrower cum non adopter farms. Logit model was used for analyzing the effects of long term credit on farm investment. Results of the Logit regression model revealed that the net operated area, long term loan amount, education level, family size, and previous investment by farmer are significantly influencing on investment behaviour of banana growing farmers. Positive co-efficient for farm size indicated the farmer's ability to access the investment loans for making farm investment by pledging land as the security. The term loan amount, net operated area and previous investment had shown positive effect on investment.
Keywords
Short Term Credit, Term Loan, Investment, Logit Model, Marginal Effect.
Subscription
Login to verify subscription
User
Font Size
Information
- Awasthi, Arvind (2007). Production and investment credit of scheduled Commercial Banks in India: Need for a systemic approach. Indian J. Agric. Econ., 62 (3) : 314320.
- Dhawan, B.D. and Yadav, S.S. (1995). Private fixed capital formation in agriculture- Some aspects of Indian farmer’s investment behaviour. Econ. & Political Weekly, 30 (39): 103-109.
- Golait, R. (2007). Current issues in Agriculture Credit in India: An Assessment”, RBI Occasional Papers, 28: 79-100.
- Gujarati, D.N. (2005), Basic econometrics, 4th Ed. Mac GrawHill Publishers, New Delhi. 297 p.
- Kohansal, M.R., Ghorbani, M. and Mansoori, H. (2008). Effect of credit accessibility of farmers on agricultural investment and investigation of policy options in Khorasan-Razavi Province. J. Appl. Sci., 8 (23) : 4455-4459
- Naidu, V.B. and Sankar, A.S. (2007). Factors influencing agricultural credit: A Case Study. Southern Economist, 46(8): 28-30
- Rao, C.H.H. (1994). Issues Relating to Irrigation and Rural Credit in India", In G. S. Bhalla (ed.), Economic Liberalization and Indian Agriculture. New Delhi: Institute for Studies in Industrial Development.
- Roy, B.C. and Pal, Suresh (2002). Investment, agricultural productivity and rural poverty in India: A State-Level Analysis. Indian J. Agric. Econ., 57 (4) : 653-678.
- Vaidyanathan, A. (1991). Emerging Issues in Policy Planning, The Economic Times, March 11, 1991.
Abstract Views: 332
PDF Views: 0