Agriculture Credit and Rural Economic Development

Abstract

Agriculture credit plays a crucial role in shaping agricultural economy of any country. In this study, we establish that growth in agriculture credit is not limited to only agriculture economy but can have a multiplier effect on overall rural economy. Credit is an enabling factor and the impact on Agriculture Gross Domestic Product operates through its influences on the level of purchased inputs. To create demand for inputs, the entire value chain has to be strengthened which in turn generates income leading to overall rural economy growth. The study suggests that by accelerating agriculture credit growth alone, tire pace of growth toward s rural prosperity can be fastened.