Do Rehabilitated Canals Influence Irrigation Technology Choices? Evidence From Smallholders in Madhya Pradesh, India

Investments to rehabilitate and modernize irrigation systems as well as price subsidies to incentivize adoption of drip and sprinkler irrigation technologies are promoted to enhance agricultural productivity and sustainability of on-farm water use across India. We examine the effect of these two policies on farmer irrigation choices in surface irrigated farms in Madhya Pradesh. A logistic regression based on novel survey data from 918 farmers estimates a 3% reduction in the probability that farmers will adopt drip or sprinkler technologies if they are located on farms serviced by irrigation schemes where 30% or more of the irrigated area was rehabilitated. Results also reveal that, on average, farmers are 12% more likely to continue using irrigation technologies if they had adopted them prior to the start of rehabilitation works. Quantitative results are complemented with semi-structured interviews of farmers to better understand drivers of adoption, which suggest that: (1) open, gravity canals do not always restrict drip or sprinkler adoption, (2) water scarcity appears to be a strong driver for farmers to adopt, despite financial constraints, (3) socio-economic factors such as caste, education, and house ownership does not seem to influence a farmers' choice of adoption, and (4) social networks provide a stronger incentive for adoption as smallholders struggle to access government subsidies. Understanding the role of social networks in influencing the irrigation practices of farmers can complement supply-side infrastructure investments and financial incentive policies to enhance the water security of smallholders facing climatic risks to food production.