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A Profile of Farmers’ Indebtedness: AIDIS and Other Field Studies
The valuable insights provided by the all-India rural credit or debt and
investment surveys historically on estimates of household indebtedness divided
between institutional and non-institutional sources on a decennial basis are
well-known. These have shown how the institutional agencies have accounted
for an increasing share of total cash dues outstanding of cultivator households
from about 31.7 per cent in 1971 to 66.3 per cent in 1991. What is evident now
is the reversal of this rising trend after the beginning of the 1990s.In respect of
these and many other aspects, different field survey results tend to reinforce
the results derived based on official data; in many cases, they provide deeper
insights. It is necessary to take cognizance of them for better understanding
of the status and the evolving trends in sources of agricultural finance in India
and different states and regions.
In the above respect, there are three survey results on indebtedness
of farmer households for the more recent period. First, apart from the usual
decennial rural-urbandebt and investment survey 2002-03, the National Sample
Survey Organisation (NSSO) has covered the subject of indebtedness also under
a special ‘Situation Assessment Survey of Farmers’ (SAS) conducted during
January-December 2003 and published a separate report on ‘Indebtedness of
Farmer Households’ (NSSO Report No.498). Second, a regular all-India debt
and investment survey has been undertaken for the same period January –
December 2003. Though both of these surveys have covered the same period
and have been undertaken in the same NSSO Round (59
th
), the SAS has defined
indebtedness slightly differently; it is “any liability which was taken in cash or
kind is termed a loan, if the amount at the time of transaction was
`
300 or
more”, whereas the AIDIS takes into account all cash loans and loans in kind
[For a systematic review of the differences between the two surveys, see Subba
Rao (2006)].
Finally, there is the ‘Rural Finance Access Survey’ (RFAS), also of 2003,
undertaken by the World Bank and the National Council of Applied Economic
Research (NCAER) (see Priya Basu 2005). The NSSO surveys are nation-
wide surveys with a major central sample supplemented by a few state/union
territory samples, while the RFAS 2003 has covered only two Indian states,
namely, Andhra Pradesh and Uttar Pradesh, but its result make useful case
studies capable for providing excellent insights.
Size and Nature of Farmer Indebtedness
The Size
As per the 59
th
NSS round, of the total 148 million rural households,
89.35 million (or 60.4 per cent were farmer households (Table 1). Of the
