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Abstract
The objective of the paper is to analyze the priority sector lending in India by public and private sector banks. The entire study is based upon secondary data, collected from the various relevant issues published by RBI. The period of the study includes the years from 2001 to 2014. The 25 public sector and 17 private sector banks are selected by the investigators. The exponential growth rate has been calculated to analyze the growth of priority sector lending by commercial banks. To explain the inter-year as well as inter-bank disparities in priority sector lending, the co-efficient of variation has been calculated. The performance of public and private sector banks in priority sector lending has been compared with the help of t-test. To find out the various statistical values, the investigators used the Statistical Package for Social Sciences (SPSS). The investigators found that, although, on an average, the prescribed target of lending has been achieved, but, one important issue of concern is the shrinking share of priority sector credit in net bank credit over a period of time by both the public and private sector banks, which needs immediate attention of the policy makers. As far as percentage of priority sector credit to net bank is concerned, the public sector banks in all the years of the first phase and second phase ( except the years 2012 and 2103), achieved the prescribed target of lending. Further, in all the years (except the years 2001 and 2002) of the first phase and second phase, the prescribed target of priority sector lending was achieved by the private sector banks.