'Capital is a basic need in agriculture' How it is arranged by Indian farmers ? Explain
Aryan562002:
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Modern farming method such as hybrid seeds, insecticides, chemical fertilizers etc require a great deal of capital. So, the farmers need more money than before. Money can be arranged by the farmers by the following ways.
1) The medium and large farmers have their own savings from farming business which they usually deposit in the banks. They use this surplus money whenever they are in need of it.
2) While most of the small farmers borrow money for their requirement of capital. They borrow money from the large farmers or money lenders within the village. Small farmers purchase various raw materials for cultivation of land on credit from the traders within the village. The money lenders charge a high rate of interest on the amount borrowed.
3) In India agricultural credit are being advanced by different sources. The short term and medium term loan requirements of Indian farmers are mostly met by co-operative societies, moneylenders and government. But the long term loan requirements of the Indian farmers are met by land development banks and government. Various commercial banks like SBI, PNB, Bank of Baroda, Allahabad Bank, Oriental Bank of Commerce etc provide loans to the farmers. The Regional Rural Banks were established in 1975 for supplementing the commercial banks and co-operatives in providing rural credit. Since 1975, these Regional Rural Banks are advancing direct loans to small and marginal farmers and agricultural labourers
1) The medium and large farmers have their own savings from farming business which they usually deposit in the banks. They use this surplus money whenever they are in need of it.
2) While most of the small farmers borrow money for their requirement of capital. They borrow money from the large farmers or money lenders within the village. Small farmers purchase various raw materials for cultivation of land on credit from the traders within the village. The money lenders charge a high rate of interest on the amount borrowed.
3) In India agricultural credit are being advanced by different sources. The short term and medium term loan requirements of Indian farmers are mostly met by co-operative societies, moneylenders and government. But the long term loan requirements of the Indian farmers are met by land development banks and government. Various commercial banks like SBI, PNB, Bank of Baroda, Allahabad Bank, Oriental Bank of Commerce etc provide loans to the farmers. The Regional Rural Banks were established in 1975 for supplementing the commercial banks and co-operatives in providing rural credit. Since 1975, these Regional Rural Banks are advancing direct loans to small and marginal farmers and agricultural labourers
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The state has a 5% low rate loan set up for poor farmers. Unfortunately there are middlemen involved. While some are good lenders some mark up the rates to 15% to 25%.
There is also a problem with getting good seed at times with questionable dealers selling seed that has poor germination and not what they say it is. The also have some very good seed breeders.
The breeder are hampered by the lack of an intellectual property law so they must hybridize all their seed to get paid for the work they do on breeding as very little seed breeding is done by the state. That's not much of problem for some crops with male sterile lines and lines that restore fertility. But it is very expensive for some cotton that has to have the flower emasculated by hand the first 2 or 3 days it shows up and covered with a paper bag, The bag removed several days later and hand pollinated with brush and the bag replaced to get 4 or 5 seeds per flower. Fortunately they grow cotton in hills space one meter apart with 2 seeds to the hill only needing a half pound to the US acre.
Do a search for:
Indian farmers APMC
and you will se the problem many farmers in the world face not having access to free markets. Even our some of neighbors to the north, in some Canadian Provinces must sell their wheat their wheat though a government run marketing broad that appears to lost them 15% of the value of the wheat over the long run.
Like all government run marketing schemes the APMC has good points and bad. On October 9, 2007 the were paying 6.00 a bushel for wheat when we were over $8.00. In an effort to protect the farmer and consumer from fraud they expose them to the ineffectiveness of government at running time sensitive endeavors. In every case I know of government run marketing results in lower prices to the farmer and higher prices to the consumer/taxpayer. India's probable works better than most
The state has a 5% low rate loan set up for poor farmers. Unfortunately there are middlemen involved. While some are good lenders some mark up the rates to 15% to 25%.
There is also a problem with getting good seed at times with questionable dealers selling seed that has poor germination and not what they say it is. The also have some very good seed breeders.
The breeder are hampered by the lack of an intellectual property law so they must hybridize all their seed to get paid for the work they do on breeding as very little seed breeding is done by the state. That's not much of problem for some crops with male sterile lines and lines that restore fertility. But it is very expensive for some cotton that has to have the flower emasculated by hand the first 2 or 3 days it shows up and covered with a paper bag, The bag removed several days later and hand pollinated with brush and the bag replaced to get 4 or 5 seeds per flower. Fortunately they grow cotton in hills space one meter apart with 2 seeds to the hill only needing a half pound to the US acre.
Do a search for:
Indian farmers APMC
and you will se the problem many farmers in the world face not having access to free markets. Even our some of neighbors to the north, in some Canadian Provinces must sell their wheat their wheat though a government run marketing broad that appears to lost them 15% of the value of the wheat over the long run.
Like all government run marketing schemes the APMC has good points and bad. On October 9, 2007 the were paying 6.00 a bushel for wheat when we were over $8.00. In an effort to protect the farmer and consumer from fraud they expose them to the ineffectiveness of government at running time sensitive endeavors. In every case I know of government run marketing results in lower prices to the farmer and higher prices to the consumer/taxpayer. India's probable works better than most
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