UPSC Prelims 2020·GS1·economy·economic sectors and development

Under the Kisan Credit Card scheme, short-term credit support is given to farmers for which of the following purposes ? 1. Working capital for maintenance of farm assets 2. Purchase of combine harvesters, tractors and mini trucks 3. Consumption requirements of farm households 4. Post-harvest expenses 5. Construction of family house and setting up of village cold storage facility Select the correct answer using the code given below:

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  1. A1, 2 and 5 only
  2. B1, 3 and 4 onlyCorrect
  3. C2, 3, 4 and 5 only
  4. D1, 2, 3, 4 and 5

Explanation

The Kisan Credit Card (KCC) scheme was introduced to provide farmers with timely and adequate short-term credit support for their cultivation and other needs. It primarily focuses on working capital requirements. 1. Working capital for maintenance of farm assets: This is a core purpose. KCC provides credit for meeting the working capital requirements for crop production, maintenance of farm assets (like minor repairs, fuel), and other associated activities. This is correct. 2. Purchase of combine harvesters, tractors and mini trucks: These are long-term capital investments. While banks provide agricultural term loans for such purchases, KCC is specifically designed for short-term credit and typically does not cover the purchase of large farm machinery. This is incorrect. 3. Consumption requirements of farm households: The KCC scheme includes a component to meet the short-term consumption needs of farm households. This is aimed at preventing farmers from resorting to informal credit sources for their daily household expenses. This is correct. 4. Post-harvest expenses: KCC provides credit for meeting expenses related to post-harvest activities, such as transportation of produce to markets, storage costs, and processing. This is correct. 5. Construction of family house and setting up of village cold storage facility: These are long-term investments in housing and agricultural infrastructure, respectively. They are not covered under the short-term credit provided by KCC. Separate long-term loan schemes are available for such purposes. This is incorrect. Therefore, statements 1, 3, and 4 are purposes for which short-term credit support is given to farmers under the KCC scheme.
economy: Under the Kisan Credit Card scheme, short-term credit support is given to farmers for which of the following purposes ?

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