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Ipact of Agricultural Credit on Mv T.aman Rice Cultivation

Dr. BAAMustafi
PSO
Agricultural Economics Division Bangladesh Rice Research Institute

Abstract/ Executive Summary:

The government has given much emphasis to supply agricultural credit to the farmers for achieving self-sufficiency in food. The present study was undertaken to Know the source and cost of obtaining formal and informal credit and constraints on getting agricultural credit. Ninety sample farmers from each group (credit users and non-user) were selected randomly and interviewed, using a predesigned questionnaire. The institutional sources from where farmers received credit were the BKB, Sonali Bank, Janata Bank and Grameen Banks. Results Indicate that 76% of the credit came from the institutional sources. The rates of interest and recovery were found higher in the Grameen Bank. The average per farm credit receive was 76% of the total amount required. Main sources of non-institutional credit were friends and relatives, businessmen and money lenders, and the major portion of the credit was spent for different off-farm activities like food consumption, business etc. The total cost incurred to receive loan by each farm was Tk 536.82. in obtaining institutional credit. In addition to rice production, credit was spent to purchase draft power, making house, business, consumption, purchase of milking cow etc. Credit users got higher yields, gross, and net returns as well as higher benefit-cost ratio (BCR). Result indicates that credit helps in augmenting rice-production.Thirty six percent farmers reported that credit was not available in time and bribe was the most serious constraint on getting credit.

Keywords: Impact assessment, Agricultural credit, MV T.Aman rice

Location: Kpasia and Gazipur sadar Upazila

Start Date:

End Date:

Program Area: Socio-economic and Policy

Non-commodity: Credit

Objectives:

To know the source and cost of obtaining formal and informal credit,
To compare the profitability of rice cultivation with respect to credit users and non-users, and
To find out the constraints on getting agricultural credit.

Methodology:

A list of 150 MV T.Aman loaner rice farmers was collected from the Bangladesh Krishi Bank (BKB), Grammen Bank, and other commercial banks under Kapasia and Gazipur Sadar thanas. Similarly, another list of 150 farmers was prepared who did not borrow any credit from the institutional sources to grow T.Aman rice. Finally, 90 sample farmers from each of the list were selected randomly and interviewed, using a predesigned questionnaire.Collected data were analyzed using simple statistical method and presented in tabular form.

Source of Information: BRRI Annual Report, 1996,Page NO.158-164, Bangladesh Rice Research Institute, Gazipur

Article Link (Online Journal):

Funding Source:

1. Government

Budget:

Total Budget (Tk.) :

Achievement/Findings:

Though the amount of agricultural credit provided by different institutional credit provided by different institutional sources was supposed to use for rice production, virtually a large amount of credit was utilized for non-productive purposes. But, the illiterate farmers had to face a lot of problems in obtaining institutional credit. So, agricultural credit should be extended to the MV rice growers with easy terms and conditions for enhancing rice production.

Knowledge Management: Report/Proceedings