Irrigation water: assessing the economic efficiency and its pricing in banana
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Date
2023-07-24
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Department of agricultural economics, college of agriculture, Vellanikkara
Abstract
Water has distinct properties that influence both its allocation and use as a valuable resource in agriculture. Irrigation is a critical component of agricultural production. According to the UNESCO World Water Development Report (2022), India is the world's top groundwater extractor. About 80 per cent of all withdrawals are made in the agricultural sector, and India has a low irrigation efficiency of 38 per cent when compared to developed nations (GoI, 2018). When water, the elixir of life, is becoming scarce due to over exploitation, increasing or at least maintaining its efficient use is imperative. In order to achieve effective and equitable use, the Fourth Principle of the Dublin Declarations of 1992 defines water as an economic good. It encourages the conservation and protection of water resources. With the adoption of the Fourth Dublin Principle, there was a historic shift in the focus on the economic aspects of water use in general and irrigation development in particular. Numerous researchers have looked into water valuation as a tool for managing irrigation systems, reducing water consumption, and improving water allocation. Hence, evaluating irrigation water's economic effectiveness and value becomes relevant in the current scenario. It is in this context, the study was carried out with specific objectives viz., identifying the sources of irrigation, private investments for irrigation and irrigation pattern, estimating the economic efficiency of irrigation water and making an assessment of its pricing. The study was based on primary data collected from Kodakara and Chalakkudy blocks of Thrissur district owing to their maximum share of cropped area under banana and groundwater extraction in the respective blocks. 60 farmers from each blocks using pump irrigation as a source of irrigation in banana cultivation are randomly sampled to make a total of 120 sample respondents. The sources of irrigation in the study area were found to be wells, tube wells, ponds, canals, and rivers, wherein most of the farmers relied on wells for their irrigation. I The irrigation pattern of the study area included surface irrigation, drip irrigation, and sprinkler irrigation. Most farmers use surface irrigation method due to its easy management. Drip and other micro-irrigation techniques were less adopted due to their high initial investment costs and maintenance problems. The Private investment for banana farmers cultivating banana on owned and leased land was calculated by considering depreciation and miscellaneous costs. It accounted for Rs. 19,479 per hectare for owned land and Rs. 8,183 per hectare for leased farmers. The cost of cultivation for banana cultivation was worked out separately for owned and leased farmers using ABC cost concepts. The total cost of banana cultivation was found to be Rs. 4,80,877 per hectare (owned land) and Rs. 5,04,066 per hectare (leased land) with net returns of Rs. 2,61,981 and Rs. 3,22,089 per hectare, respectively. The benefit- cost ratios were found to be stable, with 1.5 (owned land) and 1.6 (leased land), respectively. The determinants of yield in banana cultivation were analyzed using the Cobb- Douglas production function. The yield of banana was regressed with different variables like the quantity of irrigation water applied, manures and fertilizers, human labour and plant protection. It was found that the quantity of irrigation water, manures and fertilizers and human labor as the major determinants of banana cultivation. The economic efficiency of irrigation water in the study area was assessed using Data Envelopment Analysis Program. The analysis showed that the technical, allocative and economic efficiencies had a mean values of 60.9, 87.1, and 53 per cent. Analysis revealed that there exists scope for increasing the efficiency of irrigation water in the study area. The average quantity of irrigation water currently used in the study area was 2.4x103 per hectare for 1373 plants per hectare, which was compared with the study results carried out in Agricultural Research Station, Chalakudy, to determine whether irrigation water is being overused or underused. The study was conducted during 2009- II 2014 on system intensification for better water productivity in banana (Nendran) (ARS Chalakudy, 2021). The study results showed that irrigating crops at 100 per cent irrigation (10 mm CPE- Cumulative Potential Evaporation), i.e., 20 liters of water per plant per day, is required for the banana to increase the bunch yield per plant significantly. The study found that the water required was 1.3 x 103 m3 per hectare (1373 plants/ha). On comparing it with the results of the present study, an overuse of 1.1 x 103 m3 per hectare was found in the study area. It is mainly attributed to the surface irrigation method followed in the study area. The marginal pricing of irrigation water under the study area was analyzed using the Cobb-Douglas production function, and the marginal value was found to be Rs. 22.31 per m3. The ratio of MVP to MFC for the quantity of water applied was also found to be 0.8, which indicated the overutilization of the irrigation water applied. Thus, the farmers in the study area are currently overutilizing the irrigation water, and the mean economic efficiency of the farm was only 53 per cent, wherein improvement can be made by promoting the use of micro-irrigation technologies such as drip instead of surface irrigation. Also, promotion of extension and awareness activities relating to water harvesting, irrigation scheduling, water management, and crop alignment for farmers and grass root level field functionaries has to be carried out to enhance the irrigation efficiency of the farms in the study area.