SUJALA WATERSHED PROJECT:
ECONOMICS OF GROUNDWATER RECHARGE FOR SUSTAINABLE WATERSHED DEVELOPMENT
Project Director, Sujala Watershed Project, Cauvery Bhawan, Bangalore

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INTRODUCTION

Initial and premature failures of irrigation wells are a predicament to farmers in hard rock areas due to cumulative well interference induced by drought situation. While demand side policies promote rapid extraction of groundwater, thereby exacerbating the predicament of well failure, supply side policies like watershed development programmes help dampen negative externalities. With the primary survey data from farmers of Basavapura watershed in Karnataka, India, this study proves that watershed development programmes have potential to alleviate the effect of drought by increasing groundwater recharge. This has contributed to increased physical and economic access to groundwater for farmers through increased pumping at reduced costs of extraction. Watershed development programmes are currently absorbing huge funds out of state and central schemes. Over the years, the focus of the programme has changed substantially. It began from a technically dominated programme and culminated into peoples' participatory schemes. However, throughout the travelogue, there are sporadic instances of single impact focused watershed development programmes. One of the important impact parameters visualised and utilised under the watershed development programme is the groundwater recharge. Therefore there is a need to design and implement programme specifically focusing on the role of watershed programme in augmenting groundwater resources. In hard rock areas, the life of irrigation wells and their groundwater yield is gradually declining due to factors singularly or in combination inter alia, interference of irrigation wells due to violation of isolation distance among wells, overdraft of groundwater without regard to recharge. In Karnataka, given the distribution of holdings, obscurity in property rights and frequently occurring droughts, interference among wells is a negative externality.

This research project funded by Sujala to University of Agricultural Sciences, Dept of Agri Economics on Economics of groundwater recharge, commenced in Oct 2004. Two Junior Research Fellows Kum. KN Poornima (purnie_nagaraju@yahoo.co.in) and Kum. N. Rashmi (rashmi_econ@yahoo.co.in) are currently recruited in this research project to work on the objectives of this study in two watersheds namely (1) Uttanur subwatershed, Mulbagal taluk, Kolar district and (2) Devaratorehalla sub watershed, Sira taluk, Tumkur district respectively.

WORK PLAN TIME SCHEDULE

A. Field Investigation

Sl.No.	Activity	Months
1	Preliminary discussions in our group, preparation of individual work plan, collating experiences of watershed results in Karnataka	Month 1
2	Presentation of results of watershed experiences pertaining to impact of watershed on agriculture productivity, land use pattern, forestry, groundwater recharge, discussions (in our Friday group meetings), comments from members of TOENRE, JRFs, SRFs and Ras, Collection of secondary data from Dept of watershed, Dept of Mines and Geology, Central Groundwater Board, Bureau of Economics and Statistics.	Months 2-3
3	Reconnaissance survey of selected Sujala microwatersheds, Conducting PRA mapping for selection of farmers.	Month 4
4	Preparation of schedule for field data collection and pre-testing	Months 5-6
5	Effective ways of conceptual and empirical measurement of watershed's contributions towards watershed goals - interaction sessions with different stake holders.	Months 7-8
6	Field data collection from farmers in sampled micro watersheds and outside watershed (as control).	Months 8-10
7	Tabulation of field data.	Months10-14
8	Economic and econometric analysis of field data from sample watersheds.	Months 15-17
9	Conducting case studies on economic impact assessment of watershed management on selected farms in up stream, downstream areas in and outside Sujala watershed.	Months 18-19
10	Preparation of draft final report	Months 20-23
11	Presentation, discussion and revision of draft final report	Month 24

B. Compilation and Submission of Reports

1. Inception Report: Dec 2004
   
2. Half yearly report: March 2005, October 2005, March 2006
   
3. Annual Report (IYEAR, IIYEAR): March 2005, March 2006
   
4. Final Report: September 2006
   
5. Publications: October 2005, September 2006
   

C. A Short Note on the line of Approach and Methodology Outlining Various Steps for Performing the Study: Introduction, Rationale, Objectives, Review Of Literature Pertinent Work Done at the University/ Karnataka/ India/Abroad. Methodology, Work Programme, Indicators

Introduction
The rainfed areas support 40 percent of India's population, contribute to 9 percent of GDP, 36 percent of India's agricultural exports, 44 percent of food production, 91 percent of coarse cereals, 80 percent of oil seeds and 65 percent of cotton. These areas are fraught with problems of erosion, land degradation and loss of productivity, which have serious equity implications as they affect the very subsistence of dry land farmers, where more than 80 percent of precipitation is lost through runoff. Karnataka has the largest arid zone area after Rajasthan. About 63 per cent of the geographical area and 71 per cent of the net sown area in Karnataka are in dry agro climatic zones. With about 23 per cent of the area under irrigation, 62 per cent of agricultural production is from dry lands, which includes entire output of pulses. Karnataka's agriculture is a gamble with monsoon and frequently faces partial or severe droughts. Low productivity in dry lands and over exploitation of groundwater for irrigation have emerged as major problems. Thus, the watershed development program is implemented for in situ moisture conservation to improve productivity of dry land through judicious use of soil and water, agronomic practices, dry land horticulture, forestry, and other soil and water conservation measures. These result in restoration of ecological balance and improve the socio economic conditions of dry land farmers.

In this study we hypothesize that benefits inter alia, in situ moisture conservation, in situ conservation of predator population and other useful biodiversity, ecological benefits such as enhanced surface water, groundwater, control of soil and water erosion, aesthetics, air and water quality and other environmental and ecological benefits due to watershed development program are apparent benefits for farmers. This has a positive impact on farmers and others in the watershed who suffer economic losses inter alia due to drought, soil erosion, low soil productivity, biotic and abiotic stress, ambient environment, premature and initial failure of irrigation wells, who all stand to gain from the overall watershed development program impact including the recharged groundwater. This further improves their resilience when compared with non-watershed program areas.

RATIONALE

Need for Economic impact assessment of watershed
Economic impact assessment of watershed inter alia includes impact on (i) rain fed farming in the watershed, in management and utilization of soil moisture under rainfed farming, discerning individual components of watershed management; (ii) upstream and downstream areas covering forestry, agriculture, horticulture and environment; (iii) groundwater recharge in turn reflected in contribution from irrigation. In these, direct and indirect, use and non-use, tangible and intangible benefits are to be valued from watershed development program. In this process of estimating the total economic value of watershed development, positive externalities due to watershed development program inter alia water infiltration, flood control, erosion control, bio diversity and species-sustaining services not valued by the market forces, get the due weighting.

Since watershed development programs are public funded, the social benefits and costs need to be considered. Thus, the need for valuation of external benefits of watershed contributes for public policies to protect natural habitats.

In recent years both central and state governments have drawn up programmes on watershed development with internal and external assistance. Given the complexity of activities in the watershed development programme and their linkages, economic evaluation, discerning tangible and intangible benefits is essential to justify investment of scarce financial resources. This will add for better formulation, modification and implementation of WDPs with appropriate institutions for sustainable management of watershed. With this background, this study will be undertaken in Sujala watershed to assess the economic impact on agriculture productivity, land use and cover, groundwater recharge, watershed ecosystem and sustainability of watershed development program.

Groundwater recharge
Groundwater development in watershed development program is inevitable since the recharged aquifers need to be utilized for farm development. In the context of increased the probability of premature and initial failures of irrigation wells thus raising the implicit and explicit costs of extraction of groundwater, the contribution of Sujala watershed development program in this regard if significant, will have equity implications on small and marginal farmers. Studies on well failure (being a well that fails or goes dry, loses its yield, or requires deepening, because of interactive effects of pumping in neighboring wells or new wells coming in, but not because of low rainfall or technical deficiency in drilling, construction, pump size) rates being dampened by watershed development program (Chandrakanth, Bisrat and Bhat, Economic and Political Weekly pp 1164-1170, 2004) are reported. As the demand for groundwater is increasing, well drilling is increasing (at a compound growth rate of 10 percent per year in some parts of Karnataka). Since there are no regulations on well drilling and groundwater use, wells are drilled without regard to the degree of recharge and the recommended isolation distance (of 600 feet between two open wells and 850 feet between two borewells). This is resulting in cumulative well interference in general in all areas where intensity of groundwater use in relation to recharge is higher. In the watershed development program, reduction in the predicament of cumulative well interference is a crucial contribution.
Considering the relatively poor access to water resources in dry lands in Karnataka, the average cost of watershed treatment per hectare (Rs. 4000) and the incremental yield increase of 50 percent, the cost of providing major irrigation (Rs. 1 lakh) and the incremental yield increase of 400 percent, the cost is in the ratio of 25:1 while the returns are in the ratio of 8:1, between irrigation and watershed treatment (KNR Sastry, Development of natural resources: A solution to environmental problems, in Anil Agarwal (ed) The Challenge of the Balance, Center for Science and Environment, New Delhi, 1994, p.125). This provides the economic rationale for watershed development program. In addition, undertaking watershed development program in dry lands where more than 50 percent of our population ekes out their living, itself addresses equity concerns.

OBJECTIVES / ISSUES ADDRESSED IN THIS STUDY

In this proposal, the economic impact on agriculture productivity, land use and cover, groundwater recharge, watershed ecosystem, sustenance of watershed technologies/ practices and the synergistic relationship among watershed treatments, locations, community institution building will be assessed with the following objectives / issues:

1. Economic impact assessment of Sujala watershed development program on rainfed land, irrigated land, livestock, common property resources and other natural resource endowments in the watershed and outside watershed
   
2. Assessment of equity in distribution of benefits of Sujala watershed development program on marginal and small farmers, women, tribals and other disadvantaged sections of the society in up stream and downstream areas of the watershed
   
3. Estimation of economic benefits due to synergistic roles of surface water bodies, other in-situ conservation efforts and the community organization in augmenting water resources for irrigation
   
4. Examination of potentialities for application of ecological economics and institutions such as correlative rights, legal structures, local user groups and negotiations between interest groups in sustainability of watershed development program
   

REVIEW OF LITERATURE PERTINENT WORK DONE AT THE UNIVERSITY/ KARNATAKA/ INDIA/ ABROAD

Lokesh (Economic Impact Assessment of Watershed Development Programe: A study of Kallambella Watershed, Karnataka, unpublished Ph.D. theses, University of Agricultural Sciences, 2004) estimated the total economic value of Kallambella watershed development program (WDP) employing "With and Without Project" framework using field data for 2000-01. The data covered socio-economic features, investment on various components of watershed, economics of rainfed and groundwater irrigated crops and other related information for 2000-01. Discounted cash flow techniques and hedonic models were used in data analysis. This study has endeavored to measure inter alia, contribution of rainfed land in WDP.

Due to WDP, the value of rainfed dry land increased by 17 per cent (Rs. 5371 per acre) over non-watershed project area. The contribution from rainfed field crops, agri-horticulture, agro-forestry and silvi-pasture is 46 percent, while contribution from groundwater irrigation is 49 percent of the total economic value of Rs. 20375 per acre. Intangible benefits formed one per cent and livestock three per cent.

Net return per acre of dry land field crops (ragi and groundnut) in watershed area was Rs. 1437, which was Rs.719 in non-watershed project (NWP) area. Due to recharge of groundwater, gross irrigated area per irrigation well increased by 53 per cent (by 2.4 acres).

The perennial crops in agri-horticulture and silvi-pasture contributed almost equally (around 45 percent) to groundwater irrigation in this watershed. While groundwater irrigation is investment intensive, perennial crops in agri-silvi system are not. Hence higher budgetary allocation in watershed be made for this sector to augment farm incomes. This also complements environmental goals through carbon sequestration.

Chandrakanth, Bisrat and Bhat (Economic and Political Weekly, pp 1164-1170, 2004) indicated that initial and premature failure of irrigation wells are a predicament to farmers in hard rock areas due to cumulative well interference induced by drought situation. While demand side policies promote rapid extraction of groundwater, exacerbating the predicament of well failure, supply side policies like watershed development program are dampening the negative externalities. With the primary survey data from farmers of Basavapura watershed in Karnataka, India, this study proves that Watershed Development Program has potential to dampen the effect of drought by increasing the groundwater recharge. This has contributed to increased physical and economic access to groundwater for farmers in the upstream and downstream of watershed, through increased pumping at reduced costs of extraction.
The impact assessment of Sujala watershed program is proposed to be measured using the following

IMPACT INDICATORS

1. Improved cropping intensity.
   
2. Equity: Class, gender and number of farmers located in upstream, middle stream and downstream who have received different benefits inter alia physical and economic access to (surface and ground) water resource.
   
3. Additional farm and non-farm income.
   
4. Extent of cultivation of waste land.
   
5. Income from agri-silvi, horti-silvi, silvi-pastoral crops.
   
6. Income from animal husbandry, dairy activities.
   
7. Availability of fuel wood from public and common lands.
   
8. Grazing of livestock on public and common lands.
   
9. Permanent improvements on the farm (like well construction, fencing, farm mechanization).
   
10. Improvement in farm assets and non farm assets.
    
11. Improvement in technology of agriculture.
    
12. Physical and economic access to different markets for better prices for farm products.
    
13. Access to better market information through communication.
    
14. Social justice and poverty alleviation (how much of poverty has been reduced and for what class, gender of farmers).
    
15. Reduction in the predicament of cumulative well interference in watershed.
    
16. Spillovers due to watershed development benefits outside the watershed: ecological benefits, environmental benefits, employment, income, information and other benefits.
    

WORK PROGRAMME

This study involves survey of a Sujala watershed development program district. In the chosen district, four micro watersheds will be chosen from each of the watersheds. Sample farmers will be chosen after conducting PRA. Questionnaire will be specially developed for this study as this detail on role of watershed program in groundwater recharge. In all a total of one hundred and twenty farmers will be selected for the field study. After field data collection, tabulation, analysis, and report writing will be undertaken. After presentation in seminars/discussion sessions, report will be finalized.

Copyright @ 2005
Department of Agricultural Economics, University of Agricultural Sciences
Gandhi Krishi Vignana Kendra, Bangalore - 560 065
Tel: 91-80-23636295, Fax: 91-80-23636295, Email: mgchandrakanth@yahoo.com