Final Report An Analysis of Resource Conservation Technology: A Case of Micro-Irrigation System (Drip Irrigation) Vaibhav Bhamoriya Susan Mathew Centre for Management in Agriculture Indian Institute of Management, Ahmedabad August 2014 Foreword It gives me great pleasure to present to you an important work of the Centre for Management in Agriculture (CMA), Indian Institute of Management, Ahmedabad (IIMA). The Centre has been actively engaged in research on management of the agriculture, food, agribusiness and rural sectors of the Indian economy since its inception in 1971. The Centre also regularly undertakes research studies for the Ministry of Agriculture as well as other agencies, on policy and institutional issues related to the development, technology, resources, inputs, production, procurement, processing, and marketing in the sectors. This book explores the experiences in adoption of drip irrigation and the impact of the technology on the conservation of the water resource and benefits to farmers. This book is a departure from the usual supply-side perspective which is often presented, and provides a demand-side perspective. It seeks to overcome the limitations of irrigation engineering oriented research which does not take into account the need, aspiration and experience of the users. It combines and compares the observations across four states of India, in two different zones, and covers pockets with varied cropping. The book shows that farmers are motivated to adopt drip irrigation primarily to cope with the scarcity in at least one of three factors of production, namely water, power and labour. They also adopt the technology in pursuit of a rapid growth in incomes which can be achieved through it. Drip irrigation appears to give very good results on each of these counts, and therefore it is seen as a very useful technology by the farmers. Drip irrigation reduces the water need per unit of land resulting in and gives a significant saving of water. The survey results show that farmers use the ‘saved’ water for a variety of purposes including cultivation of new crops, giving more irrigation to other existing crops, expanding the area under cultivation / irrigation, and also non-agricultural use. Though rare, some farmers also do sharing and / or selling of water. The study clearly establishes the benefit of the technology for conservation of water and extending its use. The book explores the adoption process beyond technology use to mastering the management of drip-irrigated agriculture and roles of stakeholders in this. The book shows that the adoption is based on a process extending from hearing about the technology, to acquiring knowledge of drip irrigation and implementing. The phases include the steps of purchasing the equipment, installation, getting subsidy approval & disbursement (which are very important given the high cost), and obtaining aftersales, technical and agronomic services. This post-adoption phase is important in getting the maximum benefit from the system. While the initial phases are substantially influenced by friends, family and local networks, the subsequent phase is dominated by the actions of drip dealer / company salespersons, and the final phase is determined by others such as the drip after-sales service staff and NGOs. The book also establishes that subsidy related experiences vary across farmers and there are major concerns of equity and equality in subsidy allocation and procedures on the ground. The findings show the positive impact of drip irrigation on soil quality, and on improving the capacity of agriculture to cope with power, labour and water scarcity. Findings indicate for a wealth maximizing impact on various kinds of farmers, it is very important to provide support to the farmers after the sales. The book presents suggestions / policy recommendations on bringing the best benefits of drip irrigation to the farmers and providing an environment friendly technology. These include promotion of clusters within a district, partnering with i various stakeholders across different phases and objectives of drip irrigation adoption. We hope the book will be found useful by researchers, policy makers, planners and practitioners. Prof. Vasant P. Gandhi Chairperson Centre for Management in Agriculture Indian Institute of Management, Ahmedabad ii Acknowledgements This study bears a deep acknowledgement to the farmers of India and their friends in the agri-input sector who relentlessly work to feed the billion plus people in India and also abroad. This study was conducted with an underlying objective of collating and creating knowledge to be useful for the farmers. The authors bear a Deep sense of gratitude to them for experimenting with the technology and also providing us time generously to share their experiences and opinions with us. Special thanks are due to Prof. S. Raman for giving us time to critique our study design, plan and also gift us his book and other valuable advice for conducting better fieldwork. The authors are also thankful to various field officers and other Government officers who helped in making effective choices for the sampling and also in identifying resources that made the survey possible. Similar thanks are due to Profs. Suresh, TNAU and Suhasini K., ANGRAU and R. L. Shiyani, SAU for similar help. Prof Suresh also came in as an expert to advice on various aspects of the study. Special thanks also in order for Shri Bharat Kavle and Ravindra Joshi, SPK, Ozar who have always helped us at short notice beyond their means. The authors also owe heartfelt gratitude for Mr. Shyamal Tikadar, CEO of GGRCL as well as Mr. Pradeep Kumar and Mr. Manishbhai of GGRCL and Dr. Santosh Baby, IAS and MD, TANHODA, Dr. B R Shah, Gujarat State for their precious time and inputs and feedback and the help for data. The authors also express thanks to Dr. D N Kulkarni and Mr. Ajit Jain of Jain Irrigation for providing inputs on the technical and manufacturing aspects of the technology and its application on the farms. Acknowledgements are also due to Mr. Ashutosh Sinha, VIllgro Innovation Marketing Pvt. Ltd. And Prof. Dinesh Marothia for their inputs on the market side issues and the linkages with resource conservation and watersheds respectively. Gratitude is also due to Babubhai Patel of NK Greenhouse, Sanjay Patel of Umiya fertilizers and Vikrambhai Patel of Sapna Fertilizers for providing supply side and dealer perspectives of the supply chain. We are also very thankful to the officials of the Ministry of Agriculture who encouraged us to take up this study and supported with generous funding for the same. We would also like to thank Colleagues at the Center for Management in Agriculture at IIM Ahmedabad for their inputs feedback and help in making this study possible and reach its conclusion. Acknowledgement is also due to Mr. Anshuman Gupta, who helped with the initial literature review and case studies as a research support. Vaibhav Bhamoriya Susan Mathew iii Table of Contents Page No. Foreword i Acknowledgements iii Table of Contents iv List of Tables vi List of Figures xi List of Acronyms x Chapter 1: Introduction 1 1.1 Introduction 1 1.2 Review of Literature 3 1.3 Literature Gaps and Areas of Interest 20 1.4 Research Objectives 21 Chapter 2: Government Institutions, Schemes and Subsidies for Micro- 23 Irrigation in India 2.1 History of Micro-Irrigation in India 23 2.2 The Government Schemes 25 Chapter 3: Methodology 35 3.1 Choice of States 35 3.2 Choice of Pockets within each State 37 3.3 The Survey Methodology 38 3.4 Limitations of the Study 39 Chapter 4: Findings from the Case Studies 42 4.1 Labour Shortage 42 4.2 Special Purpose Vehicles Promoting Drip Irrigation in a Big Way 43 4.3 Water Table Benefits 44 4.4 Increase in Irrigated Area and Consolidation of Landholding 44 4.5 Fertigation and Savings on Fertilizers 45 4.6 Shift in Cropping Pattern 45 4.7 Increased Incomes 46 4.8 Erratic Electricity and Coping with Untimely Supply 46 4.9 Scale Neutrality or Lack of thereof 47 4.10 Other Multiple Benefits of Adoption 47 4.11 Different Adoption Levels 47 Chapter 5: The Sample and Its Characteristics 49 5.1 Farmer Profile 50 5.2 Farm Profile 54 Chapter 6: Findings from the Primary Survey 57 6.1 Impacts on Water 57 6.2 Soil Health and Quality 65 iv 6.3 What Impacts the Success of Drip Irrigation? 66 6.4 Impact on Irrigation Practices 68 6.5 Impacts on Agriculture and its Economics 68 6.6 Impact on Irrigation Practices and Energy Irrigation Nexus 79 6.7 Impact on Farm Level Economics 81 6.8 Technical Issues Associated with Drip Irrigation Adoption 86 6.9 Overall Impacts of Drip Irrigation 91 Chapter 7: Conclusions and Policy Recommendations 94 7.1 Success of Drip Irrigation 94 7.2 Impact on Water Resource Conservation 95 7.3 Drip Irrigation and Economics of Irrigation and Agriculture 97 7.4 Limitations of the Technology 99 7.5 The Role of Various Actors in the Adoption and Utilization Process 99 7.6 Subsidy and Related Issues 101 7.7 Trainings and other Capacity Development Efforts 102 7.8 Other Issues 103 7.9 Propositions Arising out of Summary of Results thus far 103 7.10 Regression Model 104 7.11 Policy Recommendations 107 References 110 Annexure 1 : Micro-Irrigation in Village Chandrala 114 Annexure 2 : Micro-Irrigation in Village Chanvelly 128 Annexure 3 : Micro-Irrigation in Village Janori 132 Annexure 4 : Micro-Irrigation in Village Kamana 140 Annexure 5 : Micro-Irrigation in Village Pamena 146 Annexure 6 : Some Additional Data Tables 151 Annexure 7 : Subsidy Process Experience Tables 162 Annexure I : Review Report 165 Annexure II : Action Taken Report 167 v List of Tables Table Page. 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