Financial Risk Management and Sustainable Planning for Farmers and Agripreneurs in India

Abstract

India's agricultural sector, contributing 18.2% to the national GDP and providing livelihood support to 42.3% of the population, faces multifaceted financial risks including price volatility, climate variability, credit inaccessibility, and inadequate insurance penetration. This paper investigates the financial risk management mechanisms and sustainable planning strategies available to Indian farmers and agripreneurs, with specific focus on crop insurance under PMFBY, institutional credit flow through NABARD and commercial banks, and the role of agripreneurial diversification in income stabilization. The objectives encompass evaluating the effectiveness of existing financial risk mitigation instruments and assessing sustainable planning frameworks for agripreneurial growth. A descriptive-analytical methodology was adopted utilizing secondary data from government reports, RBI bulletins, NABARD annual reports, and PMFBY dashboards for the period 2019–2025. The hypothesis posits that integrated financial risk management positively correlates with sustainable agricultural planning outcomes. Results reveal that PMFBY enrollment increased by 32% between 2022–23 and 2024–25, while agricultural ground-level credit disbursement reached ₹25.1 lakh crore in FY2024, surpassing targets by 25%. The discussion confirms that multi-layered risk management combining insurance, credit access, and agripreneurial diversification significantly enhances farm-level financial resilience. The paper concludes that policy convergence between financial inclusion and sustainable agricultural practices is essential for long-term agrarian prosperity.