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INTRODUCTION
Since Independence India has developed from the stage of net importing to exporting of food grains. Foodgrains production has quadrupled from 50 million tonnes (mt) in 1950s to 209 mt in 2000, while the population tripled during the same period. But, even after nationalisation of banks in 1969 and introduction of several banking sector reforms, still majority of the farmers are suffering from a major economic disease called 'Indebtedness' and lack timely and adequate agricultural credit. The small size of land holdings, poor resource base and varying monsoon behaviour are exposing majority of the farmers', particularly the small and marginal, lives leading some of them finally to commit suicide because of mounting debts to moneylenders.
In the Indian context rural indebtedness is resonant with the overtones of unproductive usage, usurious rates of interest and deplorable conditions of the poor farmers and agricultural labourers. To help the rural people get out of indebtedness we require to carry out empirical investigations for understanding the process in which indebtedness becomes self-perpetuating. The analysis of the productive and distributive effects of indebtedness in four tribal villages of North Lakhimpur subdivision, Assam indicated that it leads to decline in agricultural productivity, captivation of productive resources and aggravation of inequalities in the rural community (Mitra et al, 1986).
Northern Telangana is the largest agro-climatic zone of Andhra Pradesh that comprises nearly 25 per cent of the cultivated area in the state and endowed with one major, Sri Ram Sagar Project, and many medium and minor irrigation sources with wide range of crops under different farming situations. However, the farmers in this zone severely suffer from the above economic disease, i.e., indebtedness and in fact, the maximum number of farmers' suicide attempts was recorded in this zone in recent years mainly caused by continuous failure of crops due to drought and mounting debts. An attempt has been made in this paper to assess the actual extent and structure of farmers' indebtedness in Northern Telangana Zone and to study the socioeconomic factors causing indebtedness with the following specific objectives: (1) To study the extent and structure of rural indebtedness in different size groups of farmers. (2) To identify the socio-economic factors causing rural indebtedness, and (3) To suggest suitable ameliorative remedial...