Farm Investment and Income Variations across different Farm size Categories and Regions in Punjab

The study analyzed the farm investment pattern and level of income over different size categories of farms and various Zones of the Punjab state. The study is based on the data collected for the agricultural year 2014–15 under the scheme ‘Economics of Farming and Financial position of Punjab farmers ’from 325 farm holdings, 50 holdings were selected from Zone I, 175 from Zone II and 100 from Zone III. The category wise sample consisted of 49 marginal, 75 small, 88 semi-medium, 55 medium and 58 large farming households. An effort was made to find out the reasons for different investment behavior in different Zones. The study revealed that on average 486457 per farm were invested in different components of capital assets. The highest amount of investment (32.66 percent) was made on machinery followed by 29.39 percent on livestock, 19.65 percent on farm buildings and 18.35 percent on irrigation. The investment on all the capital assets per farm increased with the size of farm except on livestock. The pattern of investment across different farm sizes showed a positive relationship with the farm size on per farm basis yet it did not hold true in case of per ha. Out of all the components of capital assets viz. farm building, irrigation, machinery, and livestock; the major amount of investment was done on machinery in all the Zones of the state. Zone-III emerged as the highly capitalized Zonewith the total investment of 587109 per farm on different capital assets followed by Zone-II with 518535 per farm and Zone-I with the investment of 92072 per farm. The estimates and the magnitude of per farm and per ha gross farm income and net farm income on different farm size categories revealed that a large farmer earned five times more annual net income per farm as compared to marginal farmers.