Income, savings, cognizance and farmers’ investment archetype-A pragmatic exploration

Abstract

Agriculture is the backbone of the Indian economy. Father of our nation, Mahatma Gandhi said “India lives in villages and agriculture is the soul of Indian economy”. Agricultural land accounts for about 60% of the total landscape of India (The World Bank). Agriculture and allied activities accounts for about 15% of India's GDP offering employment to two-thirds of India's population (OECD, 2011). Indian farmers have high inclinations to save and invest. It is imperative to magnetize the earnings of the farmers and divert those appropriately into the financial system to facilitate industrialization which will result in the economic prosperity of India. This research mainly focuses on investment preferences of farmers in Tamil Nadu, India. The survey was conducted with help of 513 respondents. This study identified various significant constructs and sub constructs to study the investment preference and investment decisions of the farmers. These constructs include awareness about the Investment Avenues, factors influencing investment decision, Investment avenues that will be preferred in future. The study shows that the farmers with high business experience are able to make better decisions with the help of experts’ advice and usage of investment tools. The descriptive analysis, rank correlation, one way ANOVA test has been used to check the significance between demographic factors and constructs. The research findings and suggestions would be more useful for farmer's to take better investment decisions and also would serve as an eye opener for the financial service institutions and firms to device appropriate strategies so that all the investment avenues have an effectual reach.