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Year 2025
Volume/Issue/Review Month Volume-XVIII | Issue-II | Jul.-Dec.
Title Assessing the Impact of Priority Sector Lending on Agricultural Growth in India: Insights from ARDL Analysis
Authors Shaniba S, Gopika B
Broad area Finance
Abstract As agriculture is the Primary source of economic activity and source pertaining to acquire Sustainable Development Goals of zero poverty and zero hunger. The Reserve Bank of India, as the pillar of economic growth and development included agriculture as one among the eight-priority sector lending. This study is pertinent to how the Reserve Bank of India's Priority Sector Lending (PSL) rules will improve India's agricultural sector's financial inclusion. Additionally, the outcome of agricultural activities serves as the endogenous variable and Priority Sector Lending as the exogenous variable. Henceforth, this study intends to examine the effectiveness of these measures with reference to Sustainable Development Goals (zero poverty and zero hunger), by using secondary data. Subsequently, the research explores the actions taken by the government and the Reserve Bank of India (RBI) to enhance agriculture. Furthermore, this study aims to evaluate the effectiveness of these measures as of right now. The ARDL results show that there is a significant positive impact of Priority Sector Lending with a year lag on total agricultural production in India. Consequently, the study suggests that adequate financial support to agriculturalists under Priority Sector Lending will stimulate agriculture production and productivity for the overall development of the economy with zero poverty and hunger.
DOI https://doi.org/10.63340/SAMT/100000014
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