Agrarian Distress and Farmers Suicides

Agriculture is the main stay for more than 60% of Indian population. Agriculture has been attributed to failure of monsoons and gambling with rainfall. More than 80% of farmers belongs to the category of marginal and small scale farmers. The failure of monsoon lead to draught, lack of better prices and exploitation by the middleman are making the farmer caught by debt crop. The unbearable debt burden on the one side and apathy by the administrators and policy makers to understand suicides in real terms making the farmer to commit suicide. Further, the impact of globalisation, increased cost of cultivation making the farmers to commit suicide without finding best other alternatives to lead a normal life. The need of the hour is to declare agriculture similar to manufacturing industry and to provide similar status so that innovative agricultural activities may be started

Trends in Agricultural Credit

Agriculture sector is playing a significant role in the development of rural areas in our country. Agriculture is the main occupation and still is a strong means of livelihood and there is necessity for ensuring sustainability in these livelihoods. Agriculture and allied sectors contribute nearly 22% of GDP of India and further 9.93% contribution in total export of India. Rural indebtedness, agricultural distress, dependency on private money lenders, and farmers suicides are common features surrounding Indian Agriculture. For more than 100 years RBI and Central Government have been making efforts to enhance institutional credit in rural areas particularly to assist agricultural operations. But economic survey (GOI) 2010 shows that out of 27 public sector banks, only 14 sector banks achieved the agricultural credit target of 18% agricultural credit and in case of private sector banks only 8 achieved the target of 18% for lending to agriculture in 2009. In order to increase productivity a huge investment on agriculture is essential. Farmers need more capital in order to buy qualitative seeds, agricultural implements, power tiller, adoption of latest technology. But Indian agriculturist is not only capital scared but also faces natural vagaries in addition to unfavorable voltaile marketing conditions. Hence he needs credit for the agricultural expansion programmes. Credit enables the agriculturist to extend control over his ownership of resources. The much spoken debt relief and waiver only touched the rich agriculturist leaving small and marginal farmers not caring. Further debt waiver and relief a most ambitious programme did not succeeded as expected and programme could not be carried out successfully because of faulty implementation

Theoretical framework to introduce rainfall index-based futures contracts in India

The proposed study is attempted to frame a theoretical framework for Rainfall Index Based Futures (RIBF) contracts. The study explains the evolution and present status of rainfall risk market in India. The paper contains the detailed theoretical framework for RIBF contracts. Along with this paper elucidate the contract specification to trade the RIBF contracts. The paper show the flow of hedging the rainfall risk of various stakeholders like farmers, insurance and reinsurance companies, banking and financial institution, construction, manufacturing and other who directly or indirectly affected by the rainfall. Eventually the study identify the why the RIBF contracts are not yet developed so for and what are the essential police, regulation required for the design and development of full-fledged rainfall index-based futures contracts in India

Modeling and Designing of Rainfall Derivative Contract in India

There has been a prolonged discussion on the use of rainfall derivatives in the Indian conditions. The use of rainfall derivative instruments that could empower the ecosystem of trading and absorbing rainfall risk. The study adopted a unique approach of designing the rainfall indexation based on proposed metrics which is DRD/ERD index, this could be used as building blocks for designing rainfall derivatives similar to HDDs/CDDs underlying temperature derivatives. DRD/ERD values are computed for 36 meteorological subdivisions of India. The basic rainfall future contract structure is defined and analyse how it can reduce the rainfall risk. Like CAT bonds and weather derivatives, rainfall derivatives constitute potentially a distinct asset class and hence could be an added arsenal in the hands of investors for enriching their portfolios

Positive perception of weather index based insurance scheme in Karnataka: A case study of cotton crop

Lot of factors, ranging from climate variability, frequent natural disasters, uncertainties in yields and prices, weak rural infrastructure, imperfect markets and lack of financial services including limited span and design of risk mitigation instruments such as credit and insurance have affected Indian agriculture which in turn has affected the farmer's livelihood and incomes in India. In order to avoid the agriculture risks government and private insurance company are introducing varieties of insurance scheme. These schemes will reduce the financial loss occurred through weather vagaries in agriculture sectors. In the present day's insurance can be divided into two categories namely Crop insurance and weather index based insurance. The present article mainly focuses on impact assessment of weather index based insurance in Karnataka. The primary data was collected through random questionnaire and the secondary data regarding weather index based insurance of five districts namely Chitradurga, Dharwad, Shimog, Davangere and Tumkur were collected from Agriculture Insurance Company of India Limited. Comparative study was made between these data to know the impact of WIBI on cotton farmers. It was observed that cotton farmers in Chitradurga, Dharwad, Shimog, and Davangere, districts show more positive perception than Tumkur district

Quality management practices in Indian ISO 9000 certified companies: An empirical evaluation

`Quality' is one of the challenges Indian companies have encountered during the post-liberalization. ISO 9000 certification by companies represents a strategy to meet this challenge. This study concerns the quality management practices in sixteen ISO 9000 certified companies in India. It aims at evaluating the degree of implementation of eight critical factors of quality management, and their impact on quality performance. It is found that ISO 9000 certification has helped the companies in improving their product quality only marginally. Quality management practices of ISO 9000 companies need further improvement and ISO 9000 quality management systems are to be integrated with TQM for continuous improvement of quality

Interrelationship between Rainfall Index and Leading Stock Market Index: An Empirical Study

The Indian Nifty is one of the major financial indicators showing daily economic changes in the share market. The Nifty is affected by many factors, including rainfall. Rainfall variability is one of the systemic risks for the Indian economy. India is the only country that experiences all of the world's weather variations, and rainfall has a significant impact on the economy. India is still a developing country and it depends on the monsoon for economic development. The equity market is one of the leading economic indicators and it should be influenced by the monsoon in India. The Efficient Market Hypothesis is one of the modern investment theories, and it states that prices of stocks quickly adjust to all the available information. Rainfall is one of the weather factors that show revenue direction for the rainfall dependent industries. Normal rainfall increases farmers' purchasing power and improves trade balances by increasing exports and decreasing imports. The deficit rainfall results in higher prices of goods and it leads to higher inflation. Higher inflation adversely affects the economic development of a country. According to the Indian Meteorological Department (IMD), total quantum rainfall of less than 90% of the Long Period Average (LPA) indicates drought; 90% to 96% of the LPA indicates normal rainfall; 104% to 110% of the LPA indicates above normal rainfall; and more than 110% of the LPA indicates excess rainfall

Problems and opportunities to strengthen the D.C.C. banks in India

From a moderate start, the cooperative movement in India has reached a stupendous position. Like other form of cooperatives, the DCC Banks occupy a position of cardinal importance in three-tier credit structure in India. They came into existence due to failure of PACCs to collect the required sources of village community on one hand and to inspire the habit of thrift saving among the members to private strong capital base on the other. The PACCs could not meet the Credit requirements of their members. Hence the need was felt to provide parental help to primaries. The DCC Bank is a federal society of all primary co-operative societies in a district. This Bank provides financial assistance to village primary societies, which requires for providing it further to their members. DCC Banks in Karnataka played a vital role in the development of cooperative movement

Price discovery dynamics of Indian maize futures market

Price volatility is the feature of commodity market, which has been proved so, irrespective of the commodities' spot and futures trading activities and ban periods in India. This study investigates the relationship between maize spot and futures market prices and analyses the nature of price discovery process in India's maize futures market. The research methodology involves the application of unit root test to find out the stationarity of data set and the application of co-integration and granger-causality test in order to analyse the long run and short run relationship respectively between maize futures and spot market prices. Further, in order to identify and quantify the impact of long term association, VECM-Vector Error Correction Model is applied. The secondary data has been used covering the duration from 2013 to 2016 based on daily data. Closing spot price and futures price data of maize with the trading unit of 10 MT (Metric Tonnes) from NCDEX were taken. The findings indicate that there is one way co-movement of the data set. Granger causality shows one way causality from futures to spot market price. Further, level of price volatility influences the market adjustment or error correction rate and price discovery process from futures market to spot market which is highly significant. Here, maize futures market leads the spot market indicating that the maize futures market performs the function of price discovery