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Rural Indebtedness in India and its Consequences


Tulika Kumari and Binita Kumari



Indian Journal of Economics and Development
Year : 2016, Volume : 12, Issue : 1a
First page : ( 255) Last page : ( 258)
Print ISSN : 2277-5412. Online ISSN : 2322-0430.
Article DOI : 10.5958/2322-0430.2016.00072.X

Rural Indebtedness in India and its Consequences

Kumari Tulika*, Kumari Binita1
1Dairy Economics, Statistics and Management Division, NDRI, Karnal-132001, Haryana

*Corresponding author’s email:

JEL Codes C81, C18, Q01, Q14

Online published on 26 April, 2016.

The paper has focused on extent of rural indebtedness. Indebtedness has been increased over the decadesamong the most of the states except Gujarat, Haryana, Madhya Pradesh, Chhattisgarh and Orissa, either because of huge loans ordue to low income which is not sufficient enough to pay off the debt. Indebtedness is found to be high among cultivators group when compared to that of non-cultivators. Thus, it became a serious problem of Indian farmers. This situation gives proof of a well known saying in the country “The Indian Farmer is born in debt, lives in debt and dies in debt”. The main causes of indebtedness are poverty, ancestral debt, illiteracy and ignorance. The harmful consequences of indebtedness are low standard of living, health problem, low productivity, suicides etc. For this problem, government should take suitable remedial measures like settlement of old debt, reduction of dependence on local money lenders, control of new loans etc.

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