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This paper attempts to critically evaluate the performance of the institutional credit structure and its impact on agricultural development. Estimated values of credit demand through different approaches were compared with the resource position and the emerging issues and strategies relevant for the 21st century are enumerated. Co-operatives, commercial banks (CBs) and Regional Rural Banks (RRBs) are the three entities in the institutional credit structure. The growth performance of institutional credit structure in terms of grassroot level outlets and volume of credit delivery during the last two decades have registered a spectacular growth. Credit acts as a facilitator and it performs the important function of providing the farmers with the requisite control over resources affecting production. It is difficult to establish a direct relationship between credit and output as the former acts as a facilitator for adoption of commercial practices which directly influence the production performance. Hence, fitting a regression on value of output...