How are credit and marketing significant for the progress of agriculture?

Question

Accepted Answer

**Importance of Credit:** In agriculture, there is a long gap between crop sowing and realisation of income, so farmers are in strong need of credit. Farmers need money to meet the initial investment on seeds, fertilisers and implements and other family expenses, especially when they are seasonally unemployed. Therefore, credit is one of the factors which contribute to rural development. If institutional sources are not available, farmers will borrow from informal sources, which will increase the cost of borrowing and thereby the cost of production.

**Importance of Marketing:** Marketing is important for any production process. If goods are produced but, due to lack of marketing facilities, they do not reach the consumer — especially agricultural produce, which perishes after some time — the output will be a total waste. Therefore, we need marketing facilities in the form of regulated markets, proper transportation and communication facilities, market information, storage and insurance.