RBI data shows that it was only credit to the metropolitan areas that was affected during the global financial crisis. The chart shows that credit growth, not only to rural India, but also to urban centres, was hardly affected. The country’s resilience during the crisis was, therefore, largely because it had little effect on the country’s vast hinterland. In contrast, the big cities, which have close links with the outside world, suffered. Note, however, that credit to metropolitan areas has in general been growing much faster than loans made in other areas, except during the crisis. That is an indication of the increasing metropolization of the country.
Also See | Financial Crisis Hit Credit Growth Only in Big Cities (PDF)
Graphic by Yogesh Kumar/Mint