ISSN (Print) - 0012-9976 | ISSN (Online) - 2349-8846

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Power Subsidy for Farm Sector

Flogging the Wrong Horse

A response to “Subsidy and Efficiency of Groundwater Use and Power Consumption in Haryana” by Sucha Singh Gill and Kulwant Singh Nehra (EPW22 December 2018) puts to question the conclusions drawn about the effects of “extra” irrigation and the reasons for shift in crop patterns in Haryana.

The article Subsidy and Efficiency of Groundwater Use and Power Consumption in Haryana by Sucha Singh Gill and Kulwant Singh Nehra (EPW, 22 December 2018, pp 3240) seeks to provide quantitative estimates on the excessive use of water in agriculture in Haryana (p 34). Based on primary data, it is argued that the rise of irrigation subsidy has led to excessive use of irrigation and this extra use of irrigation has not contributed to an increase in per acre output, but has led to the wasteful use of scarce water and costly energy (p 36), estimated to be worth 844.41 crore perannum for paddy alone (p 37). These results form the basis of policy suggestions.

What catches attention is the fact that in spite of extra irrigation of whopping 26 times (p 36) in the case of electricity-operated water pumps, and 11 times in the case of diesel-operated pumps, total productivity of paddy is no different from what farmers get with recommended optimal number of irrigations under canal irrigation. This is intriguing because even with subsidised power, the marginal cost of extra irrigation is not zero. While it is obvious in the case of diesel-operated pumps that in spite of subsidised diesel, there is a significant marginal cost of extra irrigation, it is positive even in the case of electricity-operated pumps because of the labour cost of extra irrigation. Moreover, as power for the agriculture sector is often provided at night, it has its own inconvenience/cost. In these circumstances, why are farmers opting for extra irrigation?1 Do farmers have no economic sense?

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Published On : 20th Jan, 2024

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