Indebtedness and Poverty Among Rural Labour Households in Punjab

The present study was carried out with the objective of studying the incidence of poverty and indebtedness and to work out the determinants and factors affecting poverty and indebtedness among rural labour households in Punjab. The analysis revealed that major source of income for rural labour was hiring out labour in the agriculture sector. The incidence of indebtedness was found to be quite in direct relationship with the consumption-income ratio. This indicated that the rural labour households have to take loan for consumption needs also. As far as the sources of debt are concerned, the farmers and landlords advanced the major share of debt to the rural labour households for want of easy access to the institutional sources of debt. The analysis highlighted the need to extend the loan at nominal rate of interest to the rural labour households so as to enable them to adopt subsidiary occupation in order to eradicate poverty.