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Examining The Agricultural Crisis Affecting Gods Own Country

We would be looking at the present express of agriculture in the express of Kerala in India that was once thought to be the finest provider of spices during ancient times. Kerala's value during the colonial period can be judged from the fact that the Dutch, Portuguese and the English competed against the other person in obtaining a foothold in Kerala, thereby being in a position to control the global trade in spices.

However things have improved remarkably in the last decade. Despite the fact that Kerala's profile has truly gone up recently due to its impressive strides in travel and leisure leading to it being called 'Gods own country', trouble has been making in paradise for some time now and the once successful express in now in the doldrums anticipated to a debilitating agricultural problems. Because of this, there is a amazing hesitation among financial institutions in Kerala in providing agricultural credit to farmers.

Is this as a result of poor repayment capacity of the farmers? Could it be anticipated to agricultural inability? Is it since there is a new strategy among financial institutions to demote agriculture and promote industrialisation in Kerala?

Also we'd be looking at the impact of Free Trade Agreements on the farmer and how hedging and futures & options are adversely impacting on the farmers potential to get a remunerative price for his produce.

Exploration of Dilemma

Published Government files about the amount of loans provided by bankers to agricultural sector.

Reports posted by financial institutions about the non-payment of agricultural credit and associated farmers' suicide.

Price trends of various agricultural products over the last ten years

Government plans and Free Trade Agreements

Published data on forwards trading in agricultural commodities

Possible Problems

Is there an incorrect use of agricultural credit directed at the farmers?

Is there increasing variety of occurrences of non-payment of loans?

Is it because any concern with financial institutions to provide lending options to basically weakened agricultural sector?

Is it because of any new strategy developed by banking institutions to promote sectors only?

Is it because of lack of adequate Government assistance to agriculture?

Is it because lack of enough government regulations on financial institutions.

Is it due to fall in the prices of agricultural products in Kerala.

Is it because bankers channelize their funds to other profitable opportunities.

Is it because of faulty plans of the Central Government

Is it because of future trading in agricultural commodities in stock exchanges

Is it because of Free Trade Policies came into into by India with other trade blocs?

Definition of Management Question

What should be achieved to boost the agricultural credit by financial institutions and the economic position of the agricultural sector in Kerala in doing so achieving the ultimate objective of increasing farm production and making remunerative prices for the produce?

Exploration of Management Question

The exploration of information can be of qualitative and quantitative. Interviews will be conducted focusing on qualitative information. Different types of primary and secondary data will be utilized for quantitative exploration.

Qualitative Exploration

Interview with professionals of commercial bankers.

Interview with professionals of agricultural banking institutions.

Interview with managers of agricultural co-operative bankers.

Interview with presidents of agricultural co-operatives.

Interview with presidents of agricultural marketing co-operative societies.

Interview with farmers of different products who've taken agricultural credits and still straining to repay.

Interview with farmers who've taken agricultural credit and already repaid.

Interview with farmers union reps.

Interview with Authorities.

Interview with staff of the general public.

Interview with intermediaries in the credit system.

Quantitative Exploration

Primary data


a. to farmers (100)

b. to bankers (100)

c. to agricultural co-operative societies (25)

d. to Government authorities (10)

e. to general population (50)

Secondary Data

Published research paperwork and review.

Banking journals.

Agricultural journals

Magazines and information papers.

Re- identified research questions

Should the agricultural sector in Kerala be promoted?

Do farmers get enough financial assistance from banks?

Do the finance institutions have enough resources to aid agricultural sector?

Should there be some education to farmers to repay loans?

Do banks need more assistance and legislation from Government in this field?

Does the federal government need to curtail ahead trading in agricultural goods?

Does the federal government desire a re-think on the Free Trade Contracts authorized with various regional and trade blocs?

How can the slide in farm production rates be caught?

Research Proposal

Kerala is a agriculture based economy. A lot of people depend on agriculture for their livelihood. Agricultural products do have a higher very sensitive price market in Kerala. The costs are have a tendency to fluctuate during different times very widely. Most of the farmers do not get the benefit for price surge, if any, because, they could be shifted their agriculture to some other product. However, it usually happens in every season.

Farmers need the help of finance institutions for funding their agricultural needs. Framers' financial necessity is two parts, short-term and long run. Short-term assistance is intended for getting together with the bills for purchasing seeds, fertilizers income etc. long term requirement is made for the purchase of land, growth of land, purchase of machineries etc.

The basic character of farmers in Kerala is they are not large scale producers. Many of them have only two -five acres of land and producing different sorts of agricultural products. Recent years there have been a whole lot of issues like suicide of farmers because of the burden of debt. But in fact these money were extracted from private financial retailers by the farmers, who charges exorbitant rates of interest on their money supplies.

Governments are accused of the phenomena. The real hand behind it ought to be found out. Here there can be an attempt to identify the real problems with the agricultural assistance and formulate methods and strategies to overcome the issues if any.

While looking at the status of agriculture in the country, you are struck by the following situation. Kerala never had a so-called "green trend", as one did see in expresses like Punjab, Haryana, American Uttar Pradesh, Andhra etc. Why? The perfect reason is the size of keeping. Unlike in the afore-mentioned expresses, where holdings which may extend to hundreds of acres in private hands, Kerala is constantly on the have, what's known as "homestead farming"- a combo of several total annual, biennial or perennial crops, livestock, bee keeping, seafood farming etc. Only in the plantation sector - tea, pepper, cardamom or coffee - does one see reasonably large holdings. The Land Holdings Invoice along with the Tenancy Function of the fifties averted large tracts of agricultural land moving into private hands.

Justification and Constraints of the Study

Many financial institutions in Kerala aren't considering with enough importance, the application for financial assistance by farmers. This inclination is increasingly within important commercial banking institutions in Kerala. This review is an look at to determine the necessity of providing financial assistance to agriculture and find out the reasons for the hesitation on the part of financial institutions and the needed solutions. This study is bound to two districts of Kerala particularly, Idukki and Ernakulam. The truth is, both of these districts are one of the important aricultural producers in their state. Duration of the project is expected to be six months and the full total cost believed for the study is 250.

Research Objectives

The reason for this research is to find the main causes of flowing the cash of financial institutions to areas other than agriculture in the status of Kerala. It will reveal

Possible factors behind the problems



lack of regulations

incompetent management

methodology of implementation

Different methods and strategies to increase the agricultural sector.

The need for Government regulations and how it ought to be implemented

Benefits and Importance

More money and effort will be used for the development of agricultural sector by financial institutions and Government.

More infrastructural and mechanical facilities will be integrated for the assistance of the farmers.

It enhances the client satisfaction and interpersonal status.

Government regulations will be put in place for the development of agricultural sector.

Improve farm output rates

Remunerative charges for farm produce


Agriculture and financial development

Financial and banking systems

Deployment of recourses of financial institutions

Agricultural Assistance

Impact of Forwards Trading on agricultural prices

Impact of Free Trade Agreements on Kerala's agrarian economy

Relevant Subject

Baking System and Agriculture

Relevant Theories

Functionalistic Ideas of

Edward Lee Thorndike

Clark Leonard Hull

Cognitive Theories of

Gestalt theory

Jean Piaget

Edward Chace Tolman

Albbert Bandura

Neuropsychological theory of

Donald Olding Herb

Evolutionary Theory of

Bolles and Evolutionary Psychology

Research Design

Types of Data

Primary and Secondary

Preliminary Hypothesis

The Kerala agricultural sector has become very unproductive because of the absence of enough financial requirements. Federal government is not focused on these problems with enough importance. Financial institutions show abstinence from providing the required assist with the sector. By giving enough financial support, polices and rules by the federal government, we can make the sector more experienced, profitable and attractive.

Kerala has 66. 57 lakh holdings (as per 2000-01 data) with an average size of positioning of 0. 22 hectares compared to 1. 47 hectares at the nationwide level.

Agricultural sector is closely linked with the livelihood security of 95% of the state's inhabitants.

Kerala makes up about 1. 56% of the net sown area and 1. 61% of gross cropped area in India.

The value of outcome contributed by Kerala in respect of traded plants includes 92. 50% of silicone, 85% of dark pepper, 81% of cardamom, 55% of tapioca, 50% of the coconut, 33% of espresso, 17% of areacanut, 14% of cashew and 12% of dry ginger.

At the same time, Kerala's talk about in export of the products of these plants was of up to 94% in silicone, 92% of pepper, 83% of spices olive oil, 74% of cardamom, 67% of cashew kernal, 63% of ginger, 22% of turmeric, 27% of curry powder and 16% of vanilla and 95% of cashew shell engine oil.

Kerala accounted for 2/3 (67. 45%) show of the export of spices at the national level. Out of Rs. 983 crores of forex received in 2004-05 through the export of pepper, cardamom, ginger, turmeric, curry natural powder, spice natural oils and oleoresins, nutmeg and mace and vanilla, Kerala contributed just as much as Rs. 663 crores which constituted 67. 45% talk about. Hence, Kerala plays an extremely decisive role in India's agricultural exports especially in the case of certain spices and plantation vegetation.

Since home and international market segments are highly interdependent increased imports and exports under FTAs will have important implications on the local production, consumption, home product prices and degrees of living of the farmers.

One unique feature of Kerala's agricultural sector is the high amount of trade sensitivity. Approximately 80% of the gross cropped area is under plantation crops, spices and nut vegetation.

Tools\ Data Analysis



Method of Data Collection (Main and Secondary)

Primary Qualitative data collection by personal interview with

1. Managers of commercial bankers.

2. Professionals of agricultural bankers.

Managers of agricultural co-operative finance institutions.

Presidents of agricultural co-operatives.

Presidents of agricultural marketing co-operative societies.

Farmers of different products who have used agricultural credits but still straining to repay.

Farmers who have considered agricultural credit and already repaid.

8 Farmer's union representatives.

9. Authorities.

10. Reps of the general public.

11. Intermediaries in the credit system.

Primary Quantitative data collection using questionnaires

Questionnaires will get to the next sections.

a. to farmers (100)

b. to bankers (100)

c. to agricultural co-operative societies (25)

d. to Authorities (10)

e. to open public (50)

Secondary Data

Published research documents and review.

Banking journals.

Agricultural journals

d. Magazines and news paperwork.

e. Website


Kerala can be an agrarian economy. Plastic, tea and coffee, pepper and cardamom, cashew, areca nut, nutmeg, ginger, cinnamon, cloves and so on, supply the agriculture of Kerala a definite flavour. It really is coconuts which bring the people their principal source of making in agriculture. Practically 70% of Indian output of coconuts is provided by Kerala. Cashew can be an important cash crop of the state of hawaii. The state has facilities for transforming raw cashew into the dried fruits, salted or simple. Cardamom is another cash crop gives Kerala a distinctive put in place Indian export. Alappuzha, one the region of Kerala known as the 'rice plate of the point out', has a predominant position in the creation of grain (kuttanad Taluk). Tapioca is another important crop of the state, cultivated mainly in dry out land. It really is a food of Kerala talk about, next to rice.

Agricultural improvement is now a dominant theme in modern-day economical reform and development. There are a growing matter among politicians and wider general population about agricultural sector. Before, there was a better kind of assist with the sector by Federal and banking institutions. But there's a tendency to give attention to other issues somewhat than basic agricultural level. Any new attempts for the improvement of agricultural sector should care for the following items.

The process should give attention to enhancing the grade of assistance.

Loans should be provided to the farmers significantly reduced rates of pursuits.

Proper guidelines of the state are crucial.

Government and finance institutions will seek to use data and enquiry directly into drive ahead the improvement initiatives.

Consequent to the liberalisation of imports almost all of the agricultural commodities

of Kerala have been experiencing severe competition from products brought in from outside. Because of this the costs of goods like coconut and copra, rubber, coffee, tea, arecanut, pepper and other spices have been down even below the cost of production. The farmers of Kerala require income to make their products competitive in the international marketplaces.

Profile of the sample households

* The homeowners closely relied on agriculture and allied activities for his or her survival.

* Fifty-five percent of the test homes belonged to the group of households solely dependent on agricultural income.

* Seventy four percent of the heads of the homes were farmers or farmer cum informal labourers.

* Of the full total employees, 57 percent was employed in agriculture and allied activities.

* Livestock rearing can be an important subsidiary job of the farmers.

* 40 six percent were sub-marginal farmers possessing a size of retaining less than 0. 50 hectare.

* 27 percent of the farmers have a size of holding between 0. 50 and one hectare.

* Eighteen percent of the farmers were small farmers having a size of keeping between one and two hectares.

Loans and indebtedness of farmers

* Ninety percent of the households had taken lending options from various options like commercial bankers, co-operative bankers, Kudumbasree, Private financial businesses, money lenders, friends family and others, money etc.

* The total amount borrowed ranged from below Rs. 20, 000 to 5 lakhs and above.

* Farmers lent money not only to meet cultivation bills but also to meet other items of expenditure such as engineering of a new house, major repair of house, relationship of family members, treatment, purchase of livestock, bills for education of children, purchase of consumer durables, business etc.

* The repayment of lending options availed from commercial and co-operative bankers are poor and unsatisfactory.

* Majority of the borrowers experienced repaid the loan availed from Kudumbasree.

* The farmers are taking more loans from non-banking financial companies such as private financial companies, money lenders, funds, friends and family members etc.

* Lack of clear land title (Pattayam) ends up with non-receipt of lending options from commercial lenders, co-operative banking institutions and other financial institutions.

* Most loans aren't repaid due to the expectation that the state or Farmers CREDIT CARD DEBT RELIEF Commission rate will accounce credit card debt relief.

Production and productivity of crops

* The crop routine is a merged one.

* Major vegetation cultivated are pepper, coconut, cocoa, silicone, nutmeg, banana and other plantains, paddy, arecanut and coffee.

* The other important vegetation cultivated are ginger, cardamom, tapioca, cloves and vanila.

* More than 73 percent of the farmers were cultivating pepper, coconut and cocoa.

* Rapid switch of cultivation is occurring in favour of rubber.

* Silicone is not really a ideal crop in the agro-climatic conditions of the district and the produce rate is low.

* The major reason behind the agricultural turmoil has been the semester in creation and


* The efficiency of most major plants such as pepper, coconut, cocoa, plastic, nutmeg recorded a fall lately.

* Yield rate for pepper dropped by 59 percent, coconut by 48 percent, cocoa by 37 percent, silicone by twenty five percent, and nutmeg by 38 percent lately.

Causes for the semester in productivity

* Farmers reported a fall season in rainfall in comparison to normal rainfall in recent years


* Lack of timely rainfall, failing of monsoons, semester in rainfall and drought conditions.

* Poor attention of plants, insufficient manure and irrigation producing a street to redemption in the yield rate.

* Spread of diseases and pest attacks on crops were major known reasons for the street to redemption in


* Forty percent of the farmers reported the pass on of 'Quick wilt' in pepper crop.

* 27 percent reported that get spread around of 'Erythrina gall wasps' in pepper


* Twenty eight percent reported pass on of 'Coconut mite' in coconut trees and shrubs.

* Forty three percent reported diseases in cocoa.

* Thirteen percent reported diseases in rubber.

* Failing of agricultural research to contain the diseases.

* Failure of government businesses to regulate the pass on of diseases.

Fall in prices

* Farmers reported semester in prices of major crops over the last five years.

* The price tag on pepper dropped by 55 percent.

* The price tag on cocoa dropped by 27 percent.

* The price tag on cardamom fell by 50 percent.

* The price of coconut dropped by 33 percent.

* The price tag on nutmeg dropped by 42 percent.

* Lack of price stabilisation options by the federal government agencies.

Cost incurred and value of agricultural products

* Because of small size cultivation, 1 / 3 (33 percent) of the farmers incurred an

expenditure in cash below Rs. 10, 000 per calendar year for cultivation.

* Another 20 percent incurred an expenditure in cash between Rs. 10, 000 and 20, 000.

* The daily wage rate for male agricultural labourer each day was Rs. 141 and then for feminine Rs. 90.

* Seventy nine percent of the farmers reported lack of labourers.

* The total annual value of agricultural outcome produced was very small (42 percent farmers acquired below Rs. 10, 000, 12 percent Rs. 10, 000 to 20, 000 and 12 percent Rs. 20, 000 to 30, 000).

* The marginal farmers were consistently getting only a very low earning from cultivation.

* An functional holding greater than two hectares must get an acceptable net income.


Agricultural system is central to any development in Kerala. Therefore the development of agriculture will mirror the total lifetime and performing of the nation. This is about time to admit the value of the sector by Federal government and financial institutions. An organised implementation of a fresh technique for the uplifting of farmers and agriculture can do something for the country.

Kerala has been facing a severe agricultural problems and majority of the

population are seriously affected due to it. In this context the next strategy may be pursued to handle the 'severe crisis'

* Implement options to solve the issues such as failure of monsoons, get spread around of diseases of vegetation, and show up in prices of agricultural goods.

* Give pain relief and credit support to solve the financial problems of farmers.

* Help the farmers to earn money from non-farming pursuits like livestock, forestry, cottage industries, agroprocessing and tertiary sector activities.

* Accelerate the procedure of economic expansion and strucutral change of the district through more general public and private investment in that way generating more income and career in non-agricultural sectors.

Credit Support to Farmers

* Permanent loans at low rate of interest should be given to farmers for replanting

perennial crops, shifting cultivation to plastic and irrigational purposes by commercial finance institutions, co-operative lenders and other finance institutions.

* Short term loans at low interest may get to farmers for purchasing

livestock by finance institutions.

* New non-agricultural loan scheme may be started for the farmers to provide credit to create houses, repair properties, marriage purpose, medical treatment, education of children, purchasing consumer durables etc.

* More lending options for starting self-employment activities in non-agricultural sector to generate more non-farm rural work for the children and unemployed.

* The Commercial Banking companies, Co-operative Banks, NABARD etc. should give liberal credit support to Kudumbasrees to expand their activities and issue of credit to women.

Failure of Monsoons and drought

* Complete the execution of all ongoing major and modest irrigation tasks in the

district immediately.

* Build new check dams, small irrigation tasks and other micro irrigation assignments suitable for the irrigation of perennial plants cultivated in dry out land.

* Renovate all existing ponds, drinking water sources, canals, streams to promote irrigation.

* Financial support and loans to farmers to construct micro irrigation tasks,

community irrigation assignments, developing new water sources, constructing irrigational infrastructure, installation of pump models etc.

Crop Diseases

* Fortify the agricultural research of the Kerala Agricultural University and other agencies to determine solutions to support the diseases of pepper, pepper standard, coconut, cocoa, plastic, espresso and arecanut.

* Inside the context of the failing of the state of hawaii agencies, Country wide Research Companies may be requested to discover solutions to contain the diseases of plants.

* Expand the actions of the Office of Agriculture and other agencies to help the farmers through pest control options, distribution of medications etc.

Price Stabilisation Measures

* Ministry of Commerce, Administration of India should start a price Monitoring cell to screen price moves of the agricultural commodities such as pepper, cardamom, espresso, tea, coconut and rubber and take steps to stabilize the home prices. Appropriate insurance policy instruments may be used to control the import of the goods and stabilize the local prices to permit the farmers to get remunerative prices.

* The product Boards approaching under the Central federal government such as Espresso Board, Spices Plank, Rubber Panel, Coconut Development Table etc. should vacation resort to market intervention steps and procurement of agricultural goods to stabilize the prices.

* In situation of steep fall in prices, the state may also holiday resort to market intervention by procuring the agricultural products such as pepper, cardamom, coconut, caffeine, tea, etc. to maintain remunerative prices to the farmers.

Generate more non-agricultural employment

* Banking institutions and finance institutions should provide liberal credit to the people to invest in non-agricultural activities.

* Start more Higher Secondary Institutions in hilly district like Idukki.

* The Government agencies and public organizations should organise Vocational

Training Schemes to teach young people to engage in non-agricultural activities such as small scale sectors, agro-processing, trade, commerce, tourism, services etc.

* Promote migration of informed youth to other areas of India and in foreign countries for careers.

* Promote travel and leisure development of the District through the execution of tourist advertising schemes.

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