International Journal of Social Science Research (IJSSR)

Institutional Credit as a Determinant of Agricultural Productivity: A Geographical Regional Analysis of India

Agricultural development has played a pivotal role in India's economic and social transformation, particularly following the Green Revolution, which marked a turning point in agricultural productivity and sustainability. As India's population grows, so does the demand for food and agricultural products, requiring continuous advancements in farming techniques and increased productivity. One of the critical drivers of this progress has been institutional credit, which provides farmers with the necessary financial support to invest in inputs, adopt modern practices, and expand their operations. This study delves into the role of institutional credit in propelling agricultural growth in India, particularly after the Green Revolution. Over the past five decades, institutional credit for agriculture has exhibited a remarkable average growth rate of 8.74%, reflecting its expanding importance in the sector. Notably, Regional Rural Banks (RRBs) have shown the highest growth rate among credit sources, with an approximate increase of 14%. Scheduled Commercial Banks (SCBs) have emerged as the dominant source of agricultural financing, substantially increasing their contribution over the years, while the share of credit from cooperatives and other commercial banks has relatively declined. Regression analysis highlights that institutional credit from cooperatives, RRBs, and SCBs significantly influences agricultural output growth. These findings underscore the critical role these financial institutions play in enhancing agricultural productivity and promoting sustainable farming practices. The study suggests that improving access to institutional credit and strategically allocating these resources can further boost agricultural growth, strengthen rural livelihoods, and ensure food security for India's growing population. By creating a more inclusive and efficient credit environment, India can address challenges in the agricultural sector and continue its path toward economic and social progress. Keywords: - Agricultural Credit, Agriculture Development, Green Revolution, RRBs, SCBs, Cooperatives, Agricultural Productivity, Livelihood.