What Determines Farmers’ Decision to Buy Irrigation Water in Water Abundant Regions? A Study of Groundwater Markets in Assam in Eastern India

Development of groundwater based irrigation technology has resulted in emergence of groundwater markets in many parts of India. Due to the localised nature of these markets, the decision to buy water by farmers is influenced not only by factors such as capital scarcity, size of operational holdings, number of fragmented plots, availability of institutional credit etc. but also by location of the site. The present study is carried out to unearth the factors influencing water buying decisions of farmers under groundwater market in water abundant regions of India taking the case of Assam in eastern India. Using field data from two districts of the state and with the help of logit regression analysis, the study examines the determinants of water buying decision of farmers. The results have shown that large own farm size, access to institutional credit, age and better contact with extension agencies significantly reduce the probability of water buying decision of a farmer. For a tenant farmer, the probability of buying water is found to be higher. The study notes that groundwater market in the study area resembles most of the characteristics of water markets reported by studies from the water scarce regions of Asian counties. The results, on the whole, indicate that water buying decision of a farmer in water abundant regions is the result of a combined effect of a number of socio-economic, farm specific and tube well specific factors.

Author: Jitu; Mrinal, Tamuli; Kanti Dutta
Volume: 2015.03
Publisher: INFER
Year: 2015
No. of pages: 32
Working papers