Impact of agricultural credit on sugarcane production

Abstract

An attempt has been made in this paper to highlight the impact of agricultural credit on sugarcane production in Erode district of Tamil Nadu. Resource use efficiency and stochastic frontier model was employed to assess the impact of agricultural credit on sugarcane production between borrower-and non-borrower farmers. Results revealed that borrower sugarcane farmers are using more quantity of inputs (setts, machine hours, irrigation hours, manure and human labour) compared to non-borrower sugarcane farmers. MVP to MIC ratio indicates that human labour usage and irrigation hours are underutilised by both the sugarcane farmers. Stochastic frontier results revealed that Borrowers are more technically efficient in sugarcane production compared to non-borrower. Based on the results appropriate policy were suggested.