Factors Influencing Economic Viability of Marginal and Small Farmers in Punjab

It has been noticed in Punjab that living in nearly the same socio-economic environment, some of the marginal and small farmers are financially viable, which means that they are able to earn enough income to meet their farm as well as household expenditure, while others fail to do so. There are multiple factors responsible for this viability. Broadly these factors are: farm size, off-farm income, income from dairy, rational domestic expenditure, and productivity of crops. This paper has examined the contribution of these factors towards the viability of marginal and small farmers by collecting data from three districts (Ropar, Ludhiana and Bathinda) of the state. The rationalizations of household expenditure and farm investment are also a source of enhancing the possibilities of financial viability of both the categories of farming families. Therefore, on the policy front, all efforts should be made to create off-farm employment opportunities for these farmers. The public investments should be made to remove the regional productivity gaps, as it will enhance income of these farmers. Assuring remunerative prices and up-scaling of the marketing and input supply facilities are the need of the hour to promote dairying and other allied activities among these farmers. All these measures will go a long way in easing the financial stress on marginal and small farmers of the area. In the prevailing economic scenario, it is difficult to pull out or push out these farmers out of agriculture in a short-run and hence the solution lies in making them part-time farmers having access to diversified sources of income as has happened in some of the South-East Asian countries.