The Hindu Business Line : Study to assess farmers' indebtedness in Kerala

According to the 59th survey of National Sample Survey Organisation in 2003, rural indebtedness in Kerala was as high as 64.40 per cent as against 48.60 per cent at the national level.

Thiruvananthapuram , Sept. 1

A study for mapping the indebtedness of farmers in the State will be set in motion in Kerala soon. The State Level Bankers Committee (SLBC) has decided to entrust the conduct of the study with one of the leading State or Central institutions involved in social development activities.

The cost of the exercise will be shared by all the banks operating in the State, according to SLBC officials.

The study is part of the Union Finance Ministry's efforts to assess the level of farmers' indebtedness in the country. The Ministry has directed that State-specific studies should be undertaken by SLBCs as there are different agro climatic zones among the States.

Credit-deposit Ratio

The study will be based on the credit-deposit ratio of a specific area and the reports from all the States will be collected to arrive at the indebtedness of the farmers at the national level. The study will cover such aspects as the present level of financial inclusion by the formal financial sector; dependency of households on the formal or informal sector for their credit needs; and strategies to be adopted by the banks for 100 per cent financial inclusion.

According to the 59th survey of National Sample Survey Organisation (NSSO) in 2003, rural indebtedness in Kerala was as high as 64.40 per cent as against 48.60 per cent at the national level.

The co-operative sector accounted for 33.80 per cent of the farmers' loans in the State, while it was 21.70 per cent in the country as a whole.

Similarly, the commercial banks distributed 30.90 per cent of the loans in Kerala and it was 22.50 per cent at the national level.

This meant that the dependence of the farmers in the State on other sources of loans was 35.30 per cent, while it was 55.80 per cent at the all-India level.