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The energy-irrigation nexus

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  • International Water Management Institute, IWMI-TATA Water Policy Program

Abstract

Electricity subsidies for farmers are an expensive legacy of past development policies. The result is overuse of both energy and water in groundwater-irrigated agriculture—threatening the financial viability of the power sector and the future of the groundwater resource itself, along with the livelihoods of the millions who depend on it. The most popular solution is the metered tariff, promoted by international donors and many of India’s state governments. But metering is the ideal solution only if the cost of metering and billing 14 million scattered, small users in India, Pakistan and Bangladesh is ignored. Easier, more feasible and more beneficial in the short run in many parts of South Asia would be the use of a rational flat tariff, which avoids the transaction costs and strong farmer opposition associated with metering. The flat-tariff option has been ignored because, in its current incarnation, it has proved a complete failure. However, combined with intelligent power supply rationing, it is a logical, viable alternative which could cut wasteful groundwater use by 12-18 km3 per year in Western and Peninsular India alone. The approach would involve (1) gradually raising tariffs to cut power utility losses; (2) supplying farms with fewer hours of power per year, but ensuring a quality power supply during periods of moisture stress; and (3) metering at the feeder level to measure and monitor farm power use, to allow good management.

Suggested Citation

  • International Water Management Institute, IWMI-TATA Water Policy Program, 2003. "The energy-irrigation nexus," IWMI Water Policy Briefings 113065, International Water Management Institute.
    • Handle: RePEc:ags:iwmwpb:113065
    DOI: 10.22004/ag.econ.113065
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    Citations

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    Cited by:

    1. Verma, Shilp & Phansalkar, Sanjiv, 2009. "India\u2019s water future 2050: potential deviations from \u2018business-as-usual\u2019," IWMI Books, Reports H042031, International Water Management Institute.
    2. Siwa Msangi & Sarah Ann Cline, 2016. "Improving Groundwater Management for Indian Agriculture: Assessing Tradeoffs Across Policy Instruments," Water Economics and Policy (WEP), World Scientific Publishing Co. Pte. Ltd., vol. 2(03), pages 1-33, September.
    3. Shaheen, F.A. & Shiyani, R.L., 2006. "Energy Costs and Groundwater Withdrawals: Results from an Optimal Control Model for North Gujarat," Indian Journal of Agricultural Economics, Indian Society of Agricultural Economics, vol. 62(1), pages 1-16.
    4. Dudhat, B. L. & Shiyani, R. L., 2008. "Equity, comparative feasibility and economic viability of groundwater investment in Saurashtra region," Conference Papers h042914, International Water Management Institute.
    5. Shah, Tushaar & Verma, Shilp, 2008. "Real-time co-management of electricity and groundwater: an assessment of Gujarat’s pioneering Jyotirgram Scheme," IWMI Conference Proceedings 235174, International Water Management Institute.
    6. Aditi Mukherji & Arijit Das, 2014. "The political economy of metering agricultural tube wells in West Bengal, India," Water International, Taylor & Francis Journals, vol. 39(5), pages 671-685, September.
    7. Singh, S. P., 2008. "Policy interplay and trade offs: some issues for groundwater policy in India," Conference Papers h042927, International Water Management Institute.
    8. Rohith, G.V. & Rashmi, K.S. & Hamsa, K.R. & Lekshmi, U. Divya & Rajeshwari, D. & Manjunatha, A.V. & Rashmi, N. & Olekar, Jagannath, 2015. "Incorporating Cost of Irrigation Water in the Currently Underestimated Cost of Cultivation: An Empirical Treatise," Indian Journal of Agricultural Economics, Indian Society of Agricultural Economics, vol. 70(3), pages 1-14.
    9. Nawaz AHMAD, 2011. "Impact of Institutional Credit on Agricultural Output: A Case Study of Pakistan," Theoretical and Applied Economics, Asociatia Generala a Economistilor din Romania / Editura Economica, vol. 0(10(563)), pages 99-120, October.
    10. Mukherji, Aditi, 2007. "The energy-irrigation nexus and its impact on groundwater markets in eastern Indo-Gangetic basin: Evidence from West Bengal, India," Energy Policy, Elsevier, vol. 35(12), pages 6413-6430, December.

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    Keywords

    Resource /Energy Economics and Policy;

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