Cotton is the second largest crop of Pakistan in terms of area after wheat and is being suffered by multiple shocks over the time due to conventional agricultural management practices, climate change, and market failures. Climate Smart Agriculture (CSA) was introduced by the Food and Agricultural Organization (FAO) in 2010, as an innovative cleaner production alternative to conventional farming that aimed at increasing the efficiency of natural resources, resilience, and productivity of agricultural production system, while reducing greenhouse gas emissions. The adverse effects of climate change on cotton production at the farm and regional level can be minimized by using CSA practices and technologies. The present study investigated the financial performance and explored the impact of CSA through sustainable water use management on cotton production in Lower Bari Doab Canal (LBDC) irrigation system of Punjab, Pakistan by using Cobb-Douglas production function. The adopters of CSA in cotton cultivation were identified by conducting six focus group discussions. Data were collected through well-structured questionnaire from 133 adopters of CSA and 65 conventional cotton growers for the cropping season 2016-2017. It was found that water-smart (raising crops on bed, laser land levelling, conjunctive use of water and drainage management), energy-smart (minimum tillage), carbon-smart (less use of chemicals) and knowledge-smart (crop rotation and improved varieties i.e., tolerant to drought, flood and heat/cold stresses) practices and technologies of CSA were adopted by the cotton farmers in the study area. Most of the farmers were of the view that they are adopting CSA practices and technologies due to the limited supply of canal water, climate change, drought-prone, massive groundwater extraction, rapidly declining groundwater table and increasing soil salinity over the time. Results revealed that uniform germination, higher yield and financial returns, the concentration of inputs and increase in resource use efficiency are the main advantages of CSA. The econometric analysis showed that implementation of CSA practices and technologies as judicious use of water and fertilizer, groundwater quality, access to extension services, and appropriate method and time of picking have a significant impact on the gross value of cotton product (GVP). The findings of the study would be helpful for policy makers to formulate policies that can minimize farmer's financial burden to adopt CSA technologies and implement for scaling out in Punjab and beyond.

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