I Fiance Apicultural

59
Although APS loans were dominant thr'oughout tile period, the
annual average of AIS and AMPS loans increased continuously (Table
19). But the annual compound growth rate in APS loans was lower than
that in eithcr AMPS or AIS loans. These rather disparate performances
suggest an imbalance between the demand for and supply of farin inputs
encouraged through APS and AIS loans, respectively. It also suggests a
lack of sustained credit support for an activity crucial to transfer of ncw
technology to APS.
7he pattern of APS loans shown in Table 20 reveals that CPGS loans
advanced by cooperatives clearly domiusted, followed distantly by
CPLM loans, and then CPI)G Iok1s.ils Over the four periods, the average
amount of CPGS loans increased continuously, while that of CPLM
loans varied significantly. The annual Comipotnd growth rate in CPGS
loans increased quite draniatically il tile second half of' the 1960s, then
it declined a id finallyimarginally incrCased. Such large flncti tions ill
growth, in so far as they are caused by cxternal factors, ai unfortunate
because they cause similar fluctuations in the adoption of new teclnology
by farmers.
Association of Agpidltural Progess with R1Is. Both agricultur.d productivity
and agricultural investments (such as fertilizer use, minor
irrigation development, plow animnals, animal hus)andry, tillage implements,
iri|gation equipment, threshers, and t:actors) are positively associated
with deisity of RFIs, rural deposits, AIS loans, AS loans, AMPS
loans, CPGS loans of coope t'3ivcs, CPI)G loans of' cooperatives, and
CPLM loans of' cOOlpeatives.
Delinqueno Rate of /11'S Loans. This is mlasnrcd as 100 nlilis loans
recovered as a peceimt of those due. The delinquency ratc was about ,15
perceit during 1973/71-1981/82. This rate was the highet, '8 percent,
in the severe dirought year of 1979/80. fi four out oflint years, the rate
declined, but it never went below '13 pcrca. The delinquency rate
could be lowered to about 35 p)eccni if it wer- measrecd as 100 Iinus
loans recovered as a percent of loans ouitstaniding.2 1 Such a measure
would to some extent allow for loan recoveries after the naturity (late,
which usually coincides with the hat-vest time. Nonetheless, even this
rate is likely to be high.
'lie reasons for tile high rate of delinquency are complex and
varied. The following arC sotire of'tle. iiportant ones: (1) natuti-al factors
like drought and floods; (2) inadequate increases in production and
marketable su-)lus; (3) misntatches between the time schedule fixed for
loan recovery and the tiic when farniers can repay loans; ('4) inadequate
credit resulting fiot i an age-old formula used to determiie the scale of'
1 9 The relative importance of these three types of loans would
commercial
be reversed
banks
if data
were
on
also considered, which was not possible because data
types
on the
of
three
APS loans made by commercial banks were not available.
20
For a similar finding based on more disaggregated data of uvijor states in India, see
Desai, Gupta, and Singh 1988.
2
'This was not computed because the required data for comnmercial banks were not
available.