OVERDRAFT IN THE INDIAN WATER BANKS Studying the Relation Between the Production of Water Intensive Crops and Groundwater Depletion in India
Sharma, Chandar Prabha
Kern, Andreas T
Historically, India has relied heavily on groundwater for agriculture with approximately, 80% of irrigated water being sourced from groundwater. This paper aims to analyze the relation between the production of water intensive crops and groundwater depletion in India. I study the crop production of 3 crops: sugarcane, cotton and rice and hypothesize that there exists a positive relationship between the production of water intensive crops and groundwater depletion. Using a novel dataset, I estimate time fixed effects and Generalized Methods of Moments (GMM) models to study this relationship. The fixed effects model shows that an increase of 1% in total area under production of rice, sugarcane and cotton is associated with an increase of 0.009 % in the distance between the ground level and the groundwater table, which is approximately equivalent to a loss of 7,191 liters of groundwater per Hectare. Using GMM, I find that a fall of 22,372 liters of groundwater associated with a 1 Ha increase in total area under production of highly water intensive crops. The results have critical policy implications for groundwater management and agricultural practices in India. These include solutions like watershed management and better rainwater harvesting to reduce the overdraft from the country’s “water banks”. In particular, based on my findings, I propose a review of energy subsidies in the agricultural sector especially as they may create perverse incentives to grow water intensive crops in areas where groundwater is low. The results also highlight the need for inclusion of groundwater as a critical input in the Soil Health Cards scheme, which is currently being rolled out by the Government of India. Sustainable crop choices can be made by considering groundwater levels, especially in the case of water intensive crops, as their production is related to the overdraft in India’s water banks.
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