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Question
Explain the importance of credit availability to farmers in rural development.
Solution
- Growth of agricultural sector: Farmers are encouraged to invest in agricultural activities by making credit available to them for the purchase of seeds, insecticides, tractors, and equipment. It increases agricultural production not only for subsistence crops but also for cash crops.
- Development of infrastructure: Credit facilities increase agricultural output. It encourages the government to provide improved infrastructure for farmers, such as better irrigation, better roads, power, and godown facilities.
- Balanced regional growth: If the agricultural industry and infrastructure develop in rural areas, it supports balanced regional growth and solves the problem of rural-urban migration.
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