Question

State the challenges before agricultural credit system.

Answer 1

An average Indian farmer, who has to work on an uneconomic holding’, using traditional methods of cultivation and being exposed to the risks of a poor agricultural season is almost always in debt. He is a perennial debtor.

Once the farmer falls into debt due to crop failure or low prices of crops or malpractices of moneylenders he can never come out of it. In fact, large part of the liabilities of farmers is ‘ancestral debt’. Thus, along with his landed property, he passes on his debt to the next generation.

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