Shallow Tubewell Irrigation in Nepal: Impacts of the Community Groundwater Irrigation Sector Project

Evaluation Document | 14 January 2013

Quantifies the economic and noneconomic impacts of shallow tubewell irrigation in Nepal. Reviews the environmental impacts on project beneficiaries and analyzes effectiveness and sustainability of water user groups.

In mid 1990s, fluctuating weather patterns and a decline in the availability of water from rivers and streams, particularly during the dry seasons, led to greater emphasis by the government of Nepal on groundwater irrigation. The 20-year Agricultural Perspective Plan, approved in 1994 with the support of the ADB, recognized the expansion of groundwater-based irrigation as a priority input in agricultural development, along with such complementary improvements as construction of all-weather agricultural roads, electrification, greater use of fertilizers, and better marketing activities.

Since then, the number of shallow tubewell irrigation has rapidly increased as an integral part of this plan. The expansion of the groundwater-irrigated areas in Nepal has been based on the use of shallow tubewells which are more appealing to small- and medium-scale farmers due to its low capital investment requirements and suitability for small-scale operations. For the Terai farmers in Nepal, shallow tubewells are an attractive option because of good aquifers in many locations and higher cost of deep tubewells.

This impact evaluation study quantifies the economic and noneconomic impacts of shallow tubewell irrigation in Nepal. It reviews the environmental impacts on project's beneficiaries, analyzes effectiveness and sustainability of water user groups, and generates findings, lessons and recommendations. The evaluation drew on the experience of the ADB-supported Community Groundwater Irrigation Sector Project which aims to increase agricultural productivity on a sustainable basis and to raise the incomes of farmers with less than 1 hectare of land by developing group-based shallow tubewell irrigation, improving farm-to-market access roads, and providing agricultural extension services. The project covered 12 districts in the lowland Terai region of Nepal. It installed 10,870 shallow tubewells, constructed 300 kilometers of farm-to-market roads, and delivered extension services to farmers by engaging nongovernment organizations.

One of the issues arising from this evaluation is the ineffective policy to support shallow tubewell development. In 2009, the government reversed a previous policy of not subsidizing shallow tubewell installation. This however did not result in expanded shallow tubewell irrigation because the government lacked the ability to adequately fund the subsidies. While this left small farmers unable to adopt groundwater irrigation, the announcement of the policy reversal hurt loan recovery, particularly by rural development banks in the eastern and central regions. Many farmers who had previously paid the full price for shallow tubewells now hope that their outstanding unsubsidized loans will be written off one day. Hence, eagerness to repay the loan may drop further.

The evaluation recognizes the tremendous potential for shallow tubewell irrigation in Nepal and it recommends developing a unified groundwater irrigation policy that builds on the success of the project so that government subsidies for shallow tubewell provision are minimized. The evaluation also suggested for ADB to steer away from fragmented approach which only addresses one or two elements of the food-water-energy nexus. Links among and between food production, water and energy availability, marketing and agribusiness needs to be taken into account.

<ul> <li>Acknowledgments</li> <li>Executive Summary</li> <li>Chapter 1: Introduction 1</li> <li>Chapter 2: The Community Groundwater Irrigation Sector Project 5</li> <li>Chapter 3: Evidence from Literature on Impact of Irrigation 8</li> <li>Chapter 4: Methodology and Data 14</li> <li>Chapter 5: Survey Results: Difference-in-Means Analysis 22</li> <li>Chapter 6: Economic Impact 29</li> <li>Chapter 7: Noneconomic Impacts 36</li> <li>Chapter 8: Effectiveness and Sustainability of Water User Groups 44</li> <li>Chapter 9: Environmental Impacts 49</li> <li>Chapter 10: Key Findings, Issues, Lessons, and Recommendations 54</li> <li>Appendixes</li> </ul>