Exploring institutional innovation in groundwater sharing: Driving market-led farming systems in Coastal Odisha, India

The impact of subsidised irrigation on farming systems is evident at the village level, especially under favourable market conditions. The study aimed to investigate different irrigation distribution arrangements and their market linkages and identified sustainable institutional frameworks for groundwater sharing that impact market-driven agriculture. To derive overarching policy guidelines for village-level water governance, surveys were conducted with 20 water user associations (WUA) in the coastal aquifers of Odisha, India. Three distinct farm types were identified by utilising 23 quantitative and qualitative variables. Multiple correspondence analysis grouped the villages into similar clusters. Boolean algebra assessed the variability in WUA performance to ascertain the attribute combinations closely linked to a market-oriented farming system. A notable contrast emerged between a highly diversified irrigated agriculture village that focused on direct marketing and a minimally diversified irrigated agriculture village tailored for contracted market supply. This contrast was marked by their distinct farming systems, water distribution structures, and marketing methods. Qualitative comparative analysis showed that a village shifted to a seasonal and off-seasonal vegetable-based farming system when it procured subsidised irrigation water from a WUA and had proximity to a terminal market. WUA, as an effective irrigation distribution system, endorsed crop diversification and paired it with suitable marketing strategies such as contract farming. This integration allowed farmers to achieve higher net returns. This study underscores the linkages among water-sharing institutions, crop selection, and market linkages. The findings indicate that membership in a WUA can enhance the net income of small and marginal farmers while also preserving the groundwater ecology in specific coastal districts of Odisha. Consequently, a similar framework could mitigate the risk of cooperation breakdowns in water-sharing systems and assist in crafting effective policy mechanisms.