Financial Empowerment of Farmers through Agricultural Credit by Commercial Banks: A Descriptive Analysis

According to the economic survey of India (2020-2021) stated that the total food production in the nation recorded at 296.65 million tonnes in the financial year and it has been increased by 11.44 million tonnes in the financial year 2019. The Indian government has set the goal to procure 42.74 million tonnes from the central pond in the financial year 2021. Similarly, the output of horticulture produce was estimated at 326.6 million tonnes in the financial year 2020. The sugar production has increased to 26.46 metric tonnes from 2019 to 2020. India is one of the prominent exporters of farm products across the world. The institutional loan is considered to play a very crucial role in the farm sector growth and development in India. The admission and delivery of rural credit are slanted in favour of healthier gifted regions and within the similar region posh towards better-off families. Agricultural credit is important to the farm credit system in India due to the capital accessibility of the farmers. It helps them to procure various raw materials such as seeds, fertilizers, land and other capital equipment. The agricultural credit is to be made accessible and available to agricultural and allied activities to promote agricultural output. The developing country like India, need greater support from the farmers for inclusive growth and development. This present study is followed the descriptive and analytical methods of research. Data for the present analysis is purely based on secondary data sources. The secondary information has been collected from various published reports such as NABARD and Reserve Bank of India for various years. During the 2004-2005 period, the target was aimed by the commercial banks was Rs.57000 crores. But the actual disbursement took place with Rs.81481 crores. It is evident from data sources that the disbursement amount was consistently increased from 2004-05 to 2007-08. The agricultural loan has been disbursed with Rs. 125477 crores, it was a huge increase as compared to the previous year disbursement of Rs. 81481 crores. It was reached 156850 crores rupees during 2007-2008.


Introduction
Agriculture is one of the prominent sectors in India to contribute greatly to gross domestic product. Agriculture is the core source of the livelihood of nearly 58 per cent of the total population. Moreover, the gross value added by the farm, forestry and fishery is estimated at 19.48 lakh crores in the financial year 2020. The share of the farm sector and the allied segments in gross value addition at current prices were stood at 17.8 per cent in the financial year 2020. According to the economic survey of India (2020-2021) stated that the total food production in the nation recorded at 296.65 million tonnes in the financial year and it has been increased by 11.44 million tonnes in the financial year 2019. The Indian government has set the goal to procure 42.74 million tonnes from the central pond in the financial year 2021. Similarly, the output of horticulture produce was estimated at 326.6 million tonnes in the financial year 2020. The sugar production has increased to 26.46 metric tonnes from 2019 to 2020. India is one of the prominent exporters of farm products across the world. The export of agricultural commodities has reached US$38.54 billion and US$35.09 billion in the financial year 2019 and 2020 respectively. The commercial bank is supporting the huge farm sector in the developing nations in many ways. The commercial bank provides credit to farmers and also the traders who sell agricultural commodities. They are consistently opening their bank branches in the villages to provide farm loans. They offer loans directly to the farmers for the production, distribution and marketing of the commodities. The commercial bank would also support the farmers through finance for animal husbandry, dairy, poultry farming and horticulture. With this backdrop, the present paper aims to identify the significant role of the agriculture sector in the promotion of the Indian economy. It also tries to emphasise the agricultural credit policy of the government in enhancing the financial empowerment of farmers.

Literature Review
The farm sector plays a key role in making the agricultural sector effective and productive for many developing nations. The shortage of formal credit availability faced by the farmers is the prime issue in applying the innovative technology in the farm sector production (Ayaz, Saima and Zakir, Hussain, 2011). It is time to relook the farm credit policy evolved from time to time narrowly targeted credit (Patel, Amrit, 2016). The institutional loan is considered to play a very crucial role in the farm sector growth and development in India. A huge number of financial institutions were engaged in the disbursement of loans to the farmers. Though, the perseverance of money lenders in the countryside loan market, the reach is still a challenge (Kumar et al, 2010). The admission and delivery of rural credit are slanted in favour of healthier gifted regions and within the similar region posh towards better-off families. The perseverance of non-institutional bases is a substance of concern and concentrated exertions need to be made to minimise their part in rural credit, predominantly because their rate of attention is very high (Kumar, et al, 2007). Agricultural growth can be attained with the support of agricultural credits. The agricultural policy is reviewed from time to time to offer required and timely loans for the farming sector. The rural loan system assumes significance because for many of the rural families in India for the economic activities. The formal institutional credit system is important for agricultural growth and development (Yadav, Sunil Singh, 2017).
Many factors supported in enhancing the farm credit in the nation. The most significant area of these has been the increased financial facilities in the rural areas by expanding the branches of commercial banks and rural development banks. The outreach of the commercial and agricultural banks has been significantly hiked further by various financial inclusion programmes (Hoda, and Terway, 2015). The non-availability of formal loans for the informal sector workers including both rural and urban areas is one of the reasons for poverty (Sivasubramanian, K, et al., 2020). Selvaraj, N., and Balajikumar, P (2015).
The major cause of rapid rural development could only be improved by a supplementary general adoption of such a policy in close cooperation with the respective government (Wilson, Franck A (1974). The current farm credit methodology is geared to the requirements of food grains output: with the share of food products output reducing as a proportion of total farm production, it is all the more trustworthy that the farm loan has not reduced as a quantity of the agricultural GDP (Mohan, Rakesh, 2004). Narayanan, Sudha, 2015).
To evolve the role and significance of the agriculture sector for the growth of the Indian economy. To emphasise the agricultural credit policy of the government in enhancing the financial empowerment of farmers. To suggest appropriate policy to the government for the promotion of credit facilities to farmers.
Agricultural credit is important to the farm credit system in India due to the capital accessibility of the farmers. It helps them to procure various raw materials such as seeds, fertilizers, land and other capital equipment. The agricultural credit is to be made accessible and available to agricultural and allied activities to promote agricultural output. The developing country like India, need greater support from the farmers for inclusive growth and development.

Methodology
This present study is followed the descriptive and analytical methods of research. Data for the present analysis is purely based on secondary data sources. The secondary information has been collected from various published reports such as NABARD and Reserve Bank of India for various years.

Analysis and Discussion
The hiked credit flow to the farm segment has not ensued in the proportionate rise in production. The mean rate of the increase of food grain output slowed to 1.2 percent during 1990-2007. Table 1 represents the target amount and the actual amount of disbursement towards the agricultural loan by the various financial institutions such as commercial banks, co-operative banks, and the regional rural banks. The contribution of the commercial banks was relatively very high in terms of the disbursement of credit to the farmers for agricultural purposes. During the 2004-2005 period, the target was aimed by the commercial banks was Rs.57000 crores. But the actual disbursement took place with Rs.81481 crores. It is evident from data sources that the disbursement amount was consistently increased from 2004-05 to 2007-08.
The agricultural loan has been disbursed with Rs. 125477 crores, it was a huge increase as compared to the previous year disbursement of Rs. 81481 crores. It was reached 156850 crores rupees during 2007-2008. Whereas the cooperative banks have disbursed as low as the commercial banks. The disbursement of agricultural credit by the cooperative bank also increased over a period of time. But the targeted amount of disbursement was not attained as per the plan. The target value of Rs.39000 crores was aimed and disbursed at Rs. 31231 crores only in 2004-05.  The commercial banks are recorded as a very less percentage of the total non-performing assets. The minimum percentage of the outstanding loan was recorded as 1.95 percent during 2008-2009 and the maximum percentage was recorded with 4.77 percent in 2012-2013 from the total non-performing asset of the commercial banks in India.

Government Policy Initiatives for the Promotion of Agriculture
To enhance the exports of agricultural commodities and value-added commodities, the MOU has been signed between the Agricultural and Processed Food Products Export Development Authority and Citrus Research Institute in October 2021. The Union Ministry of Agriculture and Farmers Welfare has declared that 8,20,600 seed kits have been distributed at free of cost. It supports enhancing the farmer's income of 343 districts of 15 major states in India.
Recently, in September 2021, the Prime Minister of India has inaugurated 35 crop varieties of higher nutritional content and climatic resilience. The Pradhan Manthri Kisan Samman Nidhi Yojana provided Rs.2021 crores to more than ten million farmer's bank account directly in 2019 and Rs. 65000 crores have been allocated through the union budget. The government of India has allowed a hundred percent of foreign direct investment for the marketing of food commodities under the automated route. The government of India has also announced and approved the postal insurance scheme for the food process units with an encouragement outlay of Rs.10900 crores. Moreover, to enhance the farmer's income in India and develop the agricultural sector, the government released resources for the agricultural machinery such as creating custom hiring places, agricultural machine banks, and high technological hubs in various states.

Summary and Conclusion
Agricultural credit is important to the farm credit system in India due to the capital accessibility of the farmers. It helps them to procure various raw materials such as seeds, fertilizers, land and other capital equipment. The agricultural credit is to be made accessible and available to agricultural and allied activities to promote agricultural output. A developing country like India, need greater support from the farmers for inclusive growth and development.