In particular, loan rates are likely to be higher relative to short-term money market rates than would otherwise have been the case; in effect, some of the incidence of the higher cost of financial intermediation falls on the borrowers.
The Gadgil formula attempted to ensure that there was objectivity in distribution of funds amongst the states in India. He wrote extensively on Indian agriculture and farm sector and the planning process in India. The basic principles advocated by Shri Gadgil on food self-sufficiency and employment orientation of planning, are significant even today for achieving “inclusive growth”.