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Rural development (Rural issues in India (Primary dependent on agriculture…

- - - - Low colleratral requirements :
        Without credit history
      - Provide loan, small requirements
      - Non banking financial institutions, non depositing
        Section 25 companies act 1956
      - Short duration loans
      - Higher frequency of repayment
        To lower the risk
      - Institutions bandhan financial services
        Annapurna microfinance
      - Self help group
        Also channel
      - Usually given to attend self sufficiency
        Entrepreneur, rural labourers
    - - Background
        
        Established 1982
        SriVerma committee
        
        Apex body
        Rural credit and RD
      - Mission
        
        Sustainable and equitable rural development
        Through effective credit support mechanism &
        
        Institutional development
        Innovative initiatives
      - Functions
        
        Apex body
        Agricultural research planning and development
        
        Supervisory function, RRB CDB
        
        Refinancing support
        Rural infrastructure, Land development
        
        Training to handicraft artisans
        Marketing platform
        
        Integrated rural development programmes
        Poverty elevation
        
        District level credit plans
        Guide and motivates banking industry
        
        International corporation
        World Bank, ADB
    - - Established 1975
        Act of parliament, for credit Bridging
      - 50% centre, 15% state
        35% commercial Banks
      - Understand local needs, local ethos
        Pro poor focus
      - Objective
        
        Taking banking services
        Rural masses
        
        Mobilize rural savings
        Channelize, productive activities in rural areas
        
        Employment generation
        Refinancing rural areas
      - Function
        
        Granting loan and advances
        Small marginal farmers, agriculture labours etc
      - Since 2005, RRB consolidation amalgamation
        Presently 82
    - - Crucial role
        agriculture research and development
      - State cooperative societies
        District cooperative banks
    - - Start 1996
      - Institutional mechanism
        Rural credit
      - Private banks involvement
    - - 1995-96
      - Timely completion of projects
        Rural oriented schemes
      - Special emphasis
        States, shortage of funds
      - Funds fromm NABARD
        Financial assistance to States
  - - - Agriculture distress
        Low landholding, marginal income
      - Deteriorating soil quality
        Water table
      - Increasing input cost
        High risk, monsoon gamble
      - Indepthness farmer suicide
      - Output price not remunerative
        Forced to borrow
    - - Only a temporary relief
        Investment for research and development
      - No incentive to improve productivity
      - Increases NPA of banks
        Affect credit flow
      - Fiscal deficit, unable to make capital expenditure
        Long-term stagnation
      - Increases government borrowings
        Cost to taxpayers
      - Political tool to short term advantage
        No long term solution