Loan waiver is the biggest demand of the protesting farmers knocking on the government's door. But, how badly indebted are the Indian farmers? The latest official data, published in April 2016 on the basis of a national survey carried out by the National Sample Survey Office (NSSO) during July 2012- June 2013 says that about 52 per cent of the agricultural households in the rural India were estimated to be indebted.
The average amount of outstanding loan per agricultural household was estimated approximately as Rs 47,000. An average agri household earns Rs 6,426 per month, adding up to Rs 77,112 per annum. Agricultural households in rural India are estimated to be 90.2 million, about 57.8 per cent of the total estimated rural households in the country.
At all India level, the percentage of indebted agricultural households increased with size class of land possessed between 41.9 per cent in the lowest size class of land possessed and 78.7 per cent among agricultural households possessing over 10.00 hectare land. The average amount of outstanding loan also increased with the size class of land possessed except for the lowest size class.
Among the major states, Andhra Pradesh had the highest share of indebted agricultural households in the country (92.9 per cent) followed by Telangana (89.1 per cent) and Tamil Nadu (82.5 per cent). Assam (17.5 per cent), Jharkhand (28.9 per cent) and Chhattisgarh (37.2 per cent) were the major states with lower share of indebted agricultural households. The average amount of outstanding loan was the highest for Kerala followed by Andhra Pradesh and Punjab. Assam followed by Jharkhand and Chhattisgarh were the states with lowest amount of average outstanding loan at the time of the survey.
In general, the agricultural households belonging to the higher size classes of land possessed (say, possessing 2.01 hectares or more land) had higher average outstanding loan compared to those belonged to the lower size classes of land possessed for all major states, except for a few cases.
The survey noted that the level of indebtedness among the agricultural households belonging to the lowest size class of land possessed (i.e. possessing less than 0.01 hectares of land), which also included the landless agricultural households, has significance in the situation assessment of agricultural households due to their lower level of income, increased dependence on wage/salary employment as the principal source of income, etc. Among the agricultural households in the lowest size class of land possessed, the largest amount of outstanding loan was reported by agricultural households in Andhra Pradesh followed by Rajasthan and Kerala.
At all India level, about 60 per cent of the outstanding loans were taken from institutional sources which included government (2.1 per cent), co-operative society (14.8 per cent) and banks (42.9 per cent). Among the non-institutional sources, 'agricultural/professional money lenders (25.8 per cent) had the major share in terms of outstanding loans. The share of institutional loans also increases with increase in the size of land possessed. For the agricultural households belonged to the lowest size class of land possessed (i.e. possessing less than 0.01 hectares of land), only about 15 per cent of the outstanding loans were from institutional sources (government, co-operative society, bank), whereas the share was about 79 per cent for the households belonging to the highest size class of land possessed (i.e. possessing over 10.00 hectares of land). Kerala, where about 90 per cent of the outstanding loans were reported to have taken from the institutional sources, had the highest share of institutional loans among the major states followed by Gujarat (79.2 per cent) and Maharashtra (76.5 per cent). Jharkhand reported the lowest share of institutional sources in the total outstanding loans, with 28 per cent, followed by Bihar (28.9 per cent) and Telangana (34.5 per cent).
In addition to indebtedness data, 'The Income, Expenditure, Productive Assets and Indebtedness of Agricultural Households in India', provides National and State/UT level broad features pertaining to income from and expenditure for various economic activities performed by the agricultural households, including farm and non-farm business and wage/salaried employment and the expenditure incurred on productive assets during the agricultural year July 2012 - June 2013.
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