Economic implications of groundwater exploitation in hard rock areas of southern peninsular India

The present paper analyses the consequences of groundwater exploitation by using field-level data collected from two distinct well irrigated areas of Karnataka. The study results show that the consequences arising out of groundwater overexploitation are severe in high well interference area compared to low well interference area. The burden of well failure is more or less equally shared by all categories of farmers but small farmers are the worst victims of resource scarcity. As a result, overexploitation of groundwater has different impacts on different categories of farmers in terms of access to groundwater, cost and returns to groundwater irrigation and its negative externality cost. The study suggests maintaining inter-well distance to prevent resource mining and calls for supply and demand side interventions. The institutional reform is necessary to restore surface water bodies to facilitate aquifer recharge. © 2012 Springer Science+Business Media Dordrecht.