A. More than 4,100 rural bank branches were closed down between 1991 and 2008. Rural branches declined from 58% in1991 to 40% by Sep 08. If at least 50% of the branches were opened in rural areas, 8000 more branches would have been established.
B. Rural C/D ratio is 57%, while metro C/D ratio is 90% and overall C/D RATIO IS 75%. If rural and semi-urban C/D ratio was maintained at 75%, Rs 1.60 lakh more loans could have been given in rural areas, helping in increasing rural incomes and employment.
C.WHILE INDUSTRY GOT NEARLY 40% OF CREDIT AGRICULTURE GOT ONLY 12% WITH A HUGE SHORFALL IN MANDATED LENDING TO THE EXTENT OF Rs ONE LAKH CRORE.

Note: The population group-wise C-D ratio in respect of rural areas at the end of March 2007 was at 61.2 per cent as per place of sanction of credit. In the case of semi-urban and urban areas the C-D ratios were 52.7 per cent and 59.5 per cent, respectively. The C-D ratio recorded in metropolitan centres was 88.5 as compared to 87.5 per cent in 2006.

• The share of credit with credit limit above Rs. 25 crore increased to 33.0 per cent in 2007from 31.1 per cent in the previous year.
Sect oral (occupation-wise) deployment of bank credit
• The share of agriculture in gross bank credit increased to 11.8 per cent from 11.4 per cent in 2006. The share of credit to industry increased from 37.4 per cent in 2006 to 38.1 percent in 2007.
• The share of small-scale industries (including village industries) in gross bank credit decreased to 3.9 per cent in 2007 from 4.1 per cent in 2006.
• The share of personal loans decreased to 22.3 per cent of gross bank credit in 2007 from the level of 23.3 per cent in the previous year.

The industry sector, with 33.0 per cent share in the incremental credit in 2006, continued to capture the major share in 2007 at 40.5 per cent. • The agriculture sector absorbed about 13.3 per cent of the incremental credit in 2007, which was almost of the same level as that of 2006. • The personal loans accounted for 18.5 per cent of incremental credit, in which share of housing loans were 10.8 per cent. • The share of credit to professionals in the incremental credit in 2007 increased to 9.1 per cent up from 7.4 per cent in 2006.

SECTORAL DEPLOYMENT OF BANK CREDIT
 (Rs. in Crore)

NFGC=Non-Food Gross Bank Credit-Figures in parentheses represent the share in total non-food gross bank credit. Table III, RBI-TPB-M08-RBI-MEMD-Apr 09.
The above table gives trend data in growth of NFBC, Agri and Industrial credit since March 2006. The data reveals that Industrial credit continues to be high at about 40% to industries providing employment to less than 20% of the workforce, while agri credit has been stagnating at about 12%, as against mandated 18% of credit to Agriculture under Priority sectors dispensation. Out of this 12% .one third is indirect agri loans and therefore agri loans for production and investment purposes account for only 8%. This has been the position since 1990s ever since reforms have started. And agri sector provides employment directly or indirectly to 60% of the people. Yet no efforts have been made by the RBI and successive Governments.

Banks have to give agricultural loans of over Rs 4 lakh crore by March 2009.From the current trends there is going to be a short fall of as much as Rs 1 lakh crore. The ratio of agricultural credit to agricultural GDP was only 33 per cent at end-March 2007 where as the ratio of industrial credit to industrial GDP was a whopping 94 per cent.
All the above data reveals that agricultural credit for poor farmers is neglected.  The claim that farm credit has doubled in three years since 2004 is also proved to be qualitatively wrong as credit to poor farmers and rural artisans has dwindled.

An analysis made by A.Benarjee, published in EPW OF 11TH April 2009, of the agricultural situation brought out adverse impact of the liberalised economic policies on the Indian farmers. In all regions where the study was conducted, including a primarily food growing region like WB, it was found that the small farmers face a decline of their incomes to drastically low levels which can not satisfy even consumption levels of required subsistence norms. In the cash crop cultivating regions of Andhra Pradesh, income decline pervades the production by some large farmers as well. The decline is also of such intensity where even non-payment of debts barely allows attainment of the required consumption levels for a good number of households in these classes. In contrast, a few large farmers retain a sizeable surplus from cultivation but they are just about able to manage and cover their required consumption expenditures.
The reasons for this pitiable situation are scaling down of public investment for agriculture, diversion of rural deposits amounting to lakhs of crores of rupees to lendings in metro areas thus denying much needed credit for farming and rural enterprises and systematically closing rural branches.

The analysis also shows that Low output prices do not allow the realisation of any net surplus to farmers. This means farm produce is underpriced and the amount is diverted to urban and metro areas by way of food subsidy at the cost of farmers. Simultaneous scaling down of government investment toward inputs and infrastructure required by agriculture over the reform period, has hindered the process of capital accumulation that is so essential for furthering agrarian transition in the country.