Question

Which of the following is/are the major problem(s) of rural indebtedness ?
A) The Indian farmer borrows year after year but is not a position to clear off his loans.
B) The size of the loans taken by the Indian farmer is too large whereas his agricultural output is not large enough to play off his debt.
C) Most of the farmers are still taking loans from the informal sources, which charge a very high rate of interest.

• A. Only A
• B. Only B
• C. Only C
• D. All A, B and C

Answer 1

The correct option is D All A, B and C

The major problems of rural indebtedness is that the Indian farmers borrows loan every year from the informal sources which charge very high rate of interest. Even the amount of the loan is very huge which the farmers are not able to repay from their annual earnings which creates a debt trap out of their life.