Indian farmers invest in tractors amid run of strong harvests

India recently became the world’s no. 1 rice producer. This reflects a run of strong harvests but also increased investment by the agriculture sector in capital goods.

The nation’s wheat and rice farmers have been spending on new tractors – reflecting both the income gained from bumper crops and healthy sentiment about the future.

We can chart registrations of new tractors (a high-frequency proxy for sales) against measures of credit in the Indian economy and harvests of key crops. The increase in tractor purchases has coincided with an accelerating expansion of commercial banks’ loan books.

CEIC users can access more charts and the full data story here.