Temporal patterns and disparities in household fixed capital formation in agriculture: an analysis of Indian states

Abstract

Among the two sources of capital formation in agriculture i.e. public and private, the latter acquires an important place as far as flow of capital funds to agriculture is concerned. Private capital formation in agriculture mainly comprises of household capital formation. The study attempts to explore the temporal trends and the extent of disparities in farm capital formation accruing from the household sector. It was found that while household capital formation grew at an impressive rate during the pre-reform period the growth sharply decelerated during the immediate post-reform period. A significant revival in growth was observed during the decade of 2000s which could be a result of the consistent efforts on the part of government to increase farmer's investment in the agricultural sector. Disparities across states with respect to level of household capital formation reduced during 1980s but increased thereafter in general and during the decade of 2000s in particular.