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The negative impact of subsidies on the adoption of drip irrigation in India: evidence from Madhya Pradesh

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  • R. P. S. Malik
  • Mark Giordano
  • M. S. Rathore

Abstract

Drip irrigation in India has expanded slowly. One reason cited is the high capital costs facing the smallholder-dominated agricultural sector. Governments have provided capital subsidies in response. This study finds that, rather than improving access to drip, the subsidy system holds the technology back, because its technical requirements, highly bureaucratic processes and pricing incentives turn many drip providers into rent-seeking agents rather than service providers to farmers, leading to price increases of 40% or more. If capital costs are truly the constraint on drip expansion in India, alternative models to address them are available.

Suggested Citation

  • R. P. S. Malik & Mark Giordano & M. S. Rathore, 2018. "The negative impact of subsidies on the adoption of drip irrigation in India: evidence from Madhya Pradesh," International Journal of Water Resources Development, Taylor & Francis Journals, vol. 34(1), pages 66-77, January.
    • Handle: RePEc:taf:cijwxx:v:34:y:2018:i:1:p:66-77
    DOI: 10.1080/07900627.2016.1238341
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    References listed on IDEAS

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    1. Namara, Regassa & Upadhyay, Bhawana & Nagar, R. K., 2005. "Adoption and impacts of microirrigation technologies: empirical results from selected localities of Maharashtra and Gujarat states of India," IWMI Research Reports H037307, International Water Management Institute.
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    1. Jordán, Cristian & Speelman, Stijn, 2020. "On-farm adoption of irrigation technologies in two irrigated valleys in Central Chile: The effect of relative abundance of water resources," Agricultural Water Management, Elsevier, vol. 236(C).
    2. Shuhong Wang & Ning Yin & Zhihai Yang, 2021. "Factors affecting sustained adoption of irrigation water-saving technologies in groundwater over-exploited areas in the North China Plain," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 23(7), pages 10528-10546, July.
    3. Mattoussi, Wided & Mattoussi, Foued & Larnaout, Afrah, 2023. "Optimal subsidization for the adoption of new irrigation technologies," Economic Analysis and Policy, Elsevier, vol. 78(C), pages 1126-1141.

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