It is normally taken for granted that in the underdeveloped economy of India, people below the poverty line and the poor farmers need lots of doles, subsidy, support of formal institutions and market supportive mechanism to ameliorate their condition. The so called green revolution in agriculture with their elaborate paraphernalia of inputs including irrigation, high yielding varieties of seeds, chemical fertilizers, pesticides, farm mechanization, formal credit systems, regulated marketing and limited crop insurance practices have not been of much use to the general farmers in India. It led to some form of agrarian prosperity in the initial phase when labor cost was low and the productivity, with limited application of fertilizer and pesticide, was high. Over time the structural inequality in the caste system, the land distribution and the dependence of the farmers on the external agencies have made them remain indebted to both the informal money-lenders and the formal agencies so much so that farmers’ suicide has attracted attention of the policy makers. This paper is an attempt to unravel the truth historically and contextually.

Risk and Uncertainties, Green Revolution, New Inputs, Formal Finance, Usury