Indebtedness among marginal and small farmers of Punjab

The present paper, based on a primary survey conducted in the year 2011-12 of 600 marginal and small farmers from various agro-climatic zones of Punjab, focuses on the their situation of indebtedness. The paper highlights the plight of these farmers as the incidence of debt among the marginal and small farmers in the state was found to be about 84 and 81 per cent, respectively. Further, the per hectare debt was found to be Rs 263011 and Rs 166790 respectively. Despite the vast network of banks in the country, still about 55 and 52 per cent of the total marginal and small farmers in the state were borrowing from non-institutional sources of which a major proportion was being used for non-productive purposes. There is a need to create a positive financial environment with ease to borrow from the institutional sources. Also, overall profitability and survival of this section of the Punjab farmers needs special attention.