Developing Rural Finance in India

3738 Words Jul 24th, 2010 15 Pages
1. Abstract: Rural Finance is about providing financial services for people living in rural areas. It comprises credit, savings and insurance in rural areas, whether provided through formal or informal mechanisms. Financial Development can exert a significant influence on the distribution of Income. In this paper, using Indian rural financial programs implemented by various financial institutions like NABARD, IFAD, SHC, etc. we investigated the various reforms / developments in Indian rural financial system. The investigation shows that, despite positive economic development in India in recent years, the number of people living below the poverty line has decreased only slightly. 2. Keywords: Credit, Savings, Insurance, Rural Finance, …show more content…
“Everything else can wait, but not agriculture.” Chidambaram admits that his government’s true challenge is not only to come up with the right policies and programs but “to deliver the intended outcomes” in Budget 2007. According to an analysis done for ET by Rajesh Shukla, senior fellow at the National Council of Applied Economic Research (NCAER), the combined share of industry and services in rural GDP has risen to 58.4% in the current fiscal from 48.6% in 1999-2000 on the back of strong growth in these sectors in the past five years while the share of agriculture slipped to 41.6%. The contribution of industry, the most robust of all rural sectors, to the rural economy is 30.2% in the current fiscal year while services account for 28.2%. Mukul G Asher, Professor of Public policy and Azad Bali an instructor at Lee Kuan Yew School of the public Policy, national University of Singapore By early February 2009, the center had released just 59% of the funds allocated for 2008-09 under the Rashtriya Krishi Vikas Yojana (RKVY) and 57% of the funds granted under the National Food Security Mission (NFSM). This reflects poorly on the priorities of the UPA Government. Credit Analysis & Research Ltd. (CARE) in its newsletter published None of the sectors (except mining and quarrying) managed to remain immune from the lag effects of the tightening monetary policy during FY08 and global and
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domestic economic slump. Agriculture sector – having
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