Answer:
Modern
farming methods such as use of HYV seeds, insecticides, pesticides, etc require
a great deal of capital and so the farmer needs more money than before.
(i) The medium and large farmers have their own savings from farming.
They are able to arrange for the capital needed.
(ii) In contrast, the small farmers have to borrow money
to arrange for the capital.
They borrow from large farmers or the village moneylenders
or the traders who supply various inputs for cultivation.
(iii) The rate of interest on such loans is very high.
They are put to great distress to repay the loans, which
is not so in the case of medium and large farmers.
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