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Credit to GDP ratio

What do we understand by 'credit to gdp ratio'?
source: strengthening rural lending, yojana(march 2014 issue)

Comments

  • That's a simple ratio only no? Credit/Gdp.
    Eg India's credit (borrowing or liabilities) to Gdp ratio is somewhere in the range of 50%.
  • that i know. but what is the significance of finding it?
  • i think it indicates the health of an economy. but i can't understand the meaning of the following lines:

    "While India as a whole has a low credit to GDP ratio of about 70 percent for agriculture, at less than 36 percent, it is even lower, indicating poor outreach of formal credit to the sector despite all the policy priority that has been given to it. "
  • edited November 2014
    It's just a reference man. If they say India provided 7000 crore rupees (which was indeed the target last year) as credit to its farmers, it may not make sense or look in perspective. So instead they would express it as a ratio to Gdp.
    And given the figure above, you could well infer that the ratio is indeed quite low. 7000crorerupees/1.89trilliondollars.
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