4. Climate variability and change: a case study in drought-prone Maharashtra.

4.1 Introduction and Background

1. About a quarter of India's drought-prone districts are in Maharashtra, with 73% of its geographic area classified as semiarid. The state is the second most populous in India with 98 million people. It has a large urban population, a literacy rate of 77% (compared to the national average of 65%), and an economy that contributes 20% of the country's manufacturing sector output and 13% of its gross domestic product. Industry and services are well developed and the state remains the financial hub of the country. But paradoxically, almost 47% of its population lives below the poverty line. Acute poverty has largely retreated to the rural areas and reflects the low productivity of the rural economy, on which 56 million people still depend for employment and income.

2. Several factors account for the languishing state of agriculture in Maharashtra: heavy monocropping in some areas, limited value addition to support agribusinesses, a degrading resource base, excessive withdrawal of groundwater, and unfavorable market conditions. Furthermore, irrigation, which covers only 16% of the total agricultural area, is accessible mainly to larger farmers that have access to power and is widely used for the cultivation of sugarcane, a water-intensive cash crop (World Bank 2002a).

3. The drought proneness of the state is a critical additional stress factor that adversely affects productivity, livelihoods, and the rural economy. Ironically, the cultivated areas lie predominantly in drought-affected districts (Ahmednagar, Solapur, Nashik, Pune, Sangli, Satara, Aurangabad, Beed, Osmanabad, Dhule, Jalgaon, and Buldhana), which account for 60% of the net sown area. These areas lie in the rain shadow region east of the Sahayadri mountain ranges in Maharashtra and the adjacent Marathwada region. Aridity appears to be encroaching upon adjacent areas: districts that previously had moderately assured rainfall, such a Vidarbha, have been afflicted by declining and unpredictable rainfall with debilitating impacts on the local economy (box 4.1). Maharashtra experienced severe and successive years of drought in 1970-1974 and 2000-2004. (38) The state Employment Guarantee Scheme (EGS), a relief and rehabilitation program of state support, was introduced in 1972 in response to a devastating drought.

4. Large tracts of rain-fed agricultural land in the state have become unremunerative. The agrarian crisis has become acute, with signs of a breakdown of coping mechanisms among vulnerable groups whose exposure to drought appear to be increasing. For these reasons Maharashtra represents an important case for assessing the coping capacities of communities and the underlying vulnerabilities associated with droughts.

Box 4.1 Rainfall Distribution in Maharashtra

Maharashtra is divided into 35 districts split among five regions:
Vidarbha (in the northeast), Marathwada (in the south-central
region), Khandesh (in the northwest), the rain shadow region
(extending from the northeast to the southeast between the coatal
districts and Marathwada), and Konkan/Western Ghats (in the
southwest, on the coast). There is a wide variation in the
distribution of rainfall across the state, with the coastal belt,
the Konkan region, receiving more than 2,000 millimeters annually,
with the second highest rainfall being recorded in the Vidarbha
region. Overall, rainfall in Maharashtra increases steadily towards
the east and average rainfall in the easternmost districts is about
1,400 millimeters. The rain shadow and Marathwada regions are the
drought-prone areas of the state, with an annual average rainfall
of less than 600 millimeters. These regions are generally
characterized by extreme aridity, hot climate, and acute deficiency
in water availability. More recently areas in Vidarbha, which
usually have reliable rainfall, have experienced variable and
reduced precipitation (Planning Commission 2006).

4.2 Characteristics of Study Area

4.2.1 Climate and Geography

5. The two drought-prone districts of Nashik and Ahmednagar, located in the Godavari basin, were chosen for the case study based on a vulnerability profiling exercise (see appendix B for details). Five villages from the drought-prone belts of the Ahmednagar and Nashik districts were identified for the study (figures 4.1 and 4.2), and a total of 420 households were selected within these villages. Though both districts are located in drought-prone zones, they are substantially different: Nashik is located closer to the higher rainfall Western Ghat region and is the more fertile and moist area. It receives an average annual rainfall of about 1,000 millimeters, and only 25% of its area is fully affected by drought. In contrast, the district of Ahmednagar is arid and lies in the scarce rainfall zone. The district is hot and dry with an average annual rainfall of 579 millimeters, the lowest in the state. All 14 blocks of the district are partially or fully affected by drought. Around 25% of the cultivated area is irrigated. The major food crops include wheat, millets (jowar and bajra), and pulses. Commercial crops grown in certain areas include sugarcane, groundnut, and cotton.

4.2.2 Anatomy of the Sample Villages

6. In both districts agriculture is the primary source of income. Reflecting agroclimatic conditions, there are great differences in average incomes between the districts: sampled villages in Nashik are much more prosperous with an average monthly income of Rs 22,500, whereas in the arid Ahmednagar villages the average monthly income is Rs 3,455. Large and medium farmer households are more dependent on agricultural sources of income, draw much higher incomes, and own more assets than their marginal and landless counterparts (table 4.1). The standard of education and accessibility to health facilities are similar among most households, except for many of the landless households. There is no significant livestock ownership except in one village in Ahmednagar (Karegaon), where all the households owned livestock.

7. Access to irrigation is of considerable importance to agriculturalists in drought-affected areas. In the sampled households, the quantity and quality of irrigation varies with landholdings. Access to irrigation in the sampled villages in Maharashtra is considerably greater than in Andhra Pradesh. More than 40% of the households in Maharashtra use either tubewells or canal irrigation, compared to 18% in Andhra Pradesh. However, the irrigation pattern in both states is similar, with sharp inequities in the distribution of irrigation facilities. Access to both tubewells and the canal system is strongly correlated with the size of landholdings (figure 4.3a). There are also consistent patterns in the quality and durability of irrigation supplies: in a drought year the irrigation sources of the marginal landholders are more rapidly depleted than for other landholding categories (figure 4.3b). Box 4.2 describes problems associated with overabstraction of groundwater in Ahmednagar and Nashik.

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[FIGURE 4.2 OMITTED]

[FIGURE 4.3a OMITTED]

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Box 4.2 Unsustainable Groundwater Development Poses Problems for
Ahmednagar and Nashik

Groundwater overdraft in hard rock areas is often self-limiting.
Once the weathered layer near the surface is dewatered, abstraction
rapidly declines due to falling water levels or water quality
problems. This is the case in large parts of western and central
Maharashtra, where groundwater abstraction for sugarcane
cultivation has reached unsustainable levels.

The most important aquifers in Maharashtra are the Deccan basalts,
where groundwater occurs within the shallow weathered and fractured
zones extending to depths of 15-20 meters. Deeper aquifers are
known to exist within the basaltic lava sequence, but are of
limited capacity. The average water table depths in the shallow
aquifer range from 5 to 10 meters below ground level during the
post-monsoon period and from 15 to 20 meters below ground level
during the pre-monsoon period. Recharge rates are low (8-14% of
rainfall).

According to state groundwater experts, overuse of groundwater
following a poor rainfall season can result in a groundwater
drought in the same year, but it more typically happens in
subsequent year(s). Much depends on (a) the levels of abstraction
and (b) the levels of recharge (i.e. rainfall, run-off and
percolation) during the drought and preceding periods. Thus
groundwater does in many drought events provide the desired buffer
to insulate incomes for a limited period of time, but this is not
assured. During a normal monsoon season the shallow aquifers
recover through recharge, but increased abstraction and greater
incidence of drought have led to cumulative damage (see figures
below). During a poor rainfall year, insufficient recharge and
overabstraction leads to a progressive decline in water levels. The
effect is worsened when pumping of groundwater takes place during
the kharif (monsoon) season which is atypical during a good
monsoon. The excessive pumping leads to a recession of the water
table and consequently wells dry up during the pre-monsoon period
(March or April) of the next calendar year. The behavior of the
aquifer during drought conditions depends on a number of
site-specific factors, such as the intensity of drought, extent of
groundwater abstraction, storm pattern and location of the village
in the watershed.

Thus, proper enforcement of regulation, planned development of
groundwater combined with suitable agricultural practices can
greatly reduce the threat to groundwater security in these
districts.

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Sources: Directorate of Groundwater Surveys and Development Agency
and Department of Water Supply and Sanitation, Government of
Maharashtra.

4.3 Impact of Drought

4.3.1 Effect of Drought on Households

8. Droughts have a devastating impact on households in these districts. Declining income, in turn, has repercussions on other aspects of household developmental status. Large landholders, with greater dependence on agricultural income, register the largest decline in income (62%). But with greater wealth and assets they also have greater capacity to withstand fluctuations in income (figure 4.4). Non-income indicators show that the poor marginal and landless farmers are worst affected by deficient rainfall (figure 4.5). As many as 33% of the landless households report that drought caused disruption in schooling for children. Drought is also associated with deteriorating health and decreased food consumption, with the landless poor being most severely impacted. A number of short-term strategies have been developed by rural households in Maharashtra to cope with drought. Box 4.3 describes the main strategies used, as indicated by the survey.

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[FIGURE 4.5 OMITTED]

Box 4.3 Short-Term Coping Measures and Responses to Drought in
Maharashtra

When drought descends, households seek alternative sources of
income: increased reliance on wage labor, petty business, dairy,
and remittance flows. Adjoining villages with good irrigation
infrastructure and cities and towns in the immediate vicinity
provide alternative options for income generation, particularly for
the marginal and landless categories. Opportunities during drought
conditions are limited and impacts are significant for farmer
households. On average, 89% of the surveyed households responded
that they embrace some short-term measures to cope with the crisis
of falling income:

* About 50% of households borrow to cover immediate needs; of these
53% borrow from formal sources and 47% from moneylenders, often at
high rates of interest. The bulk of the marginal and landless
resort to informal sources of borrowing.

* 50% of households temporarily change agricultural practices,
reducing fertilizer and seed inputs or growing alternative crops
that require less water.

* 50% resort to crop insurance schemes.

* Seasonal migration is high in the rain-fed villages, and among
the marginal and landless.

4.3.2 Vulnerability and Income Volatility

9. In drought periods, some households are more vulnerable than others. The empirical analysis finds many shared elements of drought vulnerability in two dissimilar, though arid, states--Andhra Pradesh and Maharashtra. This would suggest that the case studies have identified some of the key drivers of vulnerability among drought-affected populations. (39) Three factors have a disproportionate bearing on vulnerability:

* It is no surprise that income diversification turns out to be a key factor that helps to reduce income volatility among the households. The assessment finds that indebtedness locks household into agriculture and increases exposure to climate risks.

* Conversely, education and infrastructure bring dual benefits: the usual development gains as well as fostering income diversification into nonagricultural sources, which in turn reduces exposure to drought risk.

* Access to groundwater and other sources of water in dry years can provide a buffer against drought and meager rainfall. The analysis shows that access to groundwater in normal years tends to promote reliance on water-intensive cropping systems and so perpetuates water-intensive agriculture (which is also more lucrative). If water supplies are assured through a drought, then climate impacts are ameliorated and drought incomes are stabilized. But for most households groundwater supplies decline substantially during drought. The consequence for these households is a dramatic reduction in incomes during drought years. This highlights the critical role that groundwater could play as a safety net for households in regions with scanty and depleting aquifers (see box 4.2 for a more detailed discussion). It is important to recognize that these results are based on the findings of a single and severe drought. In general, there will be considerable variability in the effect of a drought on aquifer supplies, reflecting the interaction of recharge levels (that depend on current and past rainfall, run-off and percolation) and abstraction rates that partly reflect precipitation levels and water needs (e.g., the crop mix). Consequently, deficit rainfall could produce a drought in the same year or with a lag. In many cases the impact of a drought is felt in subsequent years.

4.4 Future Prospects under Climate Change

10. Turning to the future, the climate change projections indicate that these districts will experience significantly different climate patterns. To assess the likely consequences for agriculture, this section begins with a brief overview of climate change under the two IPCC scenarios A2 and B2. Using the Integrated Modeling System (IMS), it then examines crop responses to climate change and briefly investigates the economic consequences. In the following section, the policy conclusions are summarized.

4.4.1 Projections of Climate Change

11. The IMS finds that the following changes may occur across the Godavari basin: (40)

* An increase in precipitation of about 36% (to approximately 840 millimeters) in the A2 scenario and 24% (to about 770 millimeters) in the B2 scenario.

* This is accompanied by a projected increase in annual maximum temperatures, on average, of 3.8[degrees]C in A2 and 2.4[degrees]C in B2.

* Rainfall is found to become more variable but the variation will be very similar in B2 compared to A2; the higher rainfall is expected to increase runoff by 12.5% in B2and by 13.5% in A2.

* The monthly rainfall pattern is projected to switch somewhat: while a marginal drop would take place in May and July, an increase would be seen in the already wet months of August and September.

* In A2 about 50% of the basin's area would see an increase in rainfall and in the remaining 50% rainfall will stay within the current range. The increase would take place in the mid-west, the north, and a small pocket in the south. In B2, about 60% of the basin area will stay within the same range of rainfall while 40% will experience an increase (figure 4.6). At the district level, these changes translate into increases of rainfall for both Nashik and Ahmednagar (see appendix H)

[FIGURE 4.6 OMITTED]

4.4.2 Crop Responses to Climate Change

12. The analysis considers two common millet crops, bajra and jowar, that together account for over 60% of the total cultivated area in Nashik and 40% in Ahmednagar. The other main crop considered in the analysis is sugarcane, which accounts for about 10% of cultivated land in Ahmednagar. While a variety of newer crops have been introduced to these districts, they represent a small proportion of the cropped area. The choice of crops in this study is representative of the majority of farms and has also been guided by the need to examine how crops with different climatic preferences respond to projected climate change. Bajra and jowar are included because they characterize drought-resilient crops that are typically grown on rain-fed farms. In times of stress, these crops are given a survival irrigation if water is available. Sugarcane is included because of its economic significance and because it is a water-intensive cash crop that is grown exclusively on (larger) farms with substantial irrigation supplies.

13. Crop yields and cropping patterns in the baseline scenario are compared with those in the A2 and B2 scenarios. With the rise in temperature and rainfall, the agronomic model finds that average yields of bajra increase dramatically in the more arid district of Ahmednagar (figure 4.7a). In Nashik, bajra exhibits a modest increase in the A2 scenario, with a negligible impact in B2. (41) Jowar yields also increase by 8% under the A2 scenario, and by 6% under B2.

14. Accompanying the improving yields is a change in the pattern (distribution) of outcomes. The distribution of yields across 30 climate events in the baseline and in A2 is illustrated in figure 4.7b. Bajra yields are higher across the entire distribution in Nashik, which implies that beneficial climate outcomes occur with greater frequency, while adverse climate events, which generate low yields, become less common. Ahmednagar exhibits a similar pattern.

[FIGURE 4.7a OMITTED]

[FIGURE 4.7b OMITTED]

15. Sugarcane displays a starkly contrasting pattern of responses. Sugarcane yields are expected to decline considerably (by nearly 30%, figure 4.8a). The decrease in yields is attributed to increased moisture stress caused by the warmer climate, coupled with the low responsiveness of sugarcane to carbon dioxide levels. Similar outcomes are reported for sugarcane under climate change scenarios in other regions, such as the Caribbean islands, Mauritius, and Australia. (42) Box 4.4 provides a concise explanation of the complex interplay of changing climate patterns on sugarcane yields under simulated conditions. Looking more closely at the distribution of yields, Figure 4.8b shows that there is a uniform deterioration in outcomes. In particular, climate events that generate low yields are more frequent, whereas high-yield outcomes become less common.

Box 4.4 Sugarcane Yield and Climate Change in Ahmednagar: EPIC
Model Projections

The response of sugarcane yield to climate change is rather
complex. The impact takes place through several channels, including
temperature, water stress, and the level and distribution of
rainfall. A C4 plant (see glossary) such as sugarcane does not
benefit from C[O.sub.2] fertilization. Interestingly, the EPIC
model predicts that increasing C[O.sub.2] concentration from 420
ppm to 550 ppm will cause approximately a 13% yield drop in the
crop.

The figure below shows that sugarcane yield responds negatively to
hotter conditions. Sugarcane yield drops by 6% with a 1[degrees]C
temperature rise. The damage is even greater when the warming
intensifies: sugarcane farms will experience 22% yield loss with a
temperature rise of 2[degrees]C, and as much as 40% loss with a
rise of 3[degrees]C. The level and distribution of rainfall also
affect yields. Higher precipitation will shift the yield curve
upward, while less rainfall will shift it in the opposite direction
(green arrows). Furthermore, the change of rainfall pattern will
move the curve horizontally (orange arrows).

Although increased rainfall leads to a positive yield response, the
EPIC model predicts that this is more than offset by other forces
that overall cause yield losses for sugarcane under the A2 and B2
scenarios.

[GRAPHIC OMITTED]

Source: Data from RMSI.

[FIGURE 4.8a OMITTED]

[FIGURE 4.8b OMITTED]

4.4.3 Economic Assessment

16. The economic module estimates the expected profitability of different crops and the resulting cropping mix. Starting first with the baseline, the model finds that under current climate conditions sugarcane is vastly more profitable than either bajra or jowar. The per hectare profits of sugarcane are approximately Rs 19,000 (based on current prices and input costs), while those from bajra are Rs 1,300 in Ahmednagar and Rs 2,300 in Nashik. Consequently, on farms where there is adequate water, sugarcane is projected as the dominant crop. Elsewhere, for millet growers the crop mix is determined by water availability; the model finds that there is a gradual shift from bajra towards jowar as farm water supply declines. (43)

4.4.4 Projected Consequences of Climate Change

17. Under the A2 scenario, the higher yields of bajra and jowar translate into moderately higher profits of 15% and 8% per hectare, respectively. Conversely, the profitability of sugarcane declines dramatically by nearly 30% per hectare in A2 and by 25% in B2. But at current prices sugarcane still remains considerably more profitable, so there is little incentive to switch cropping patterns from sugarcane to either bajra or jowar. The returns per hectare from bajra would need to rise dramatically (eightfold, from Rs 2,337 to Rs 19,165 per hectare) for it to become a competitive alternative to sugarcane. (44) This suggests that despite improving millet yields and declining sugarcane output, a shift to a more less water-intensive cropping pattern may not eventuate without a change in current economic policies.

18. As before, these results are based on the assumption that product prices and all other economic conditions remain at (or close to) prevailing levels. While this approach is useful in isolating the impacts of projected climate factors from other future drivers of change (such as prices and market structure), there still remains a need to examine the robustness of the projections. These are reported in appendix G. For instance, the appendix shows that if water charges were raised from a baseline of Rs. 1.2/mm to about Rs. 40/mm the entire farm area allocated to sugarcane would shift to other less water-intensive crops. The change across this trajectory is linear.

4.5 Pulling Together the Pieces: Policy Implications

19. The fiscal burden. A review of existing government and civil society measures for drought adaptation suggests that Maharashtra's drought relief mechanism has no parallels within India, and the government has developed a well-structured response to address coping and distress associated with drought years. Appendix D provides a summary of these initiatives. The fiscal and administrative burden on the state machinery is very high. During the Tenth Five Year Plan (2002-2007), the Government of Maharashtra had a planned sectoral allocation of about Rs 152 billion. However, a single drought (2003/4) and flood (2005/6) cost the government Rs 175 billion (table 4.2). If other drought years are included the gap widens further, with expenditure on relief much greater than the amount allocated to development programs. The fiscal burden underscores the urgency of enhancing climate resilience and considering long-term adaptive measures that can be linked to sectoral programs.

20. Policy implications. The assessment in this chapter suggests many shared policy themes that would help build climate resilience in Maharashtra and Andhra Pradesh.

* In both states local public goods (infrastructure and schooling) not only bring well-recognized development gains, but also have an additional benefit of reducing long-term exposure to climate risks. These risk mitigation benefits need to be factored into investment decisions and so require the development of diagnostic tools and institutional approaches to integrate climate vulnerabilities in policy.

* Likewise, indebtedness is known to create a poverty trap, but it also emerges in Maharashtra as a constraint on income diversification that amplifies climate risk exposure. Consequently the policy framework suggested for Andhra Pradesh would apply, with appropriate modifications, to Maharashtra. In particular there is considerable scope in Maharashtra for coupling debt relief with new business capital or insurance for the start-up risks of a new business.

21. In addition to these there are two additional policy priorities that warrant special attention in Maharashtra--the reliance on sugarcane and the implications for water use and groundwater supplies.

4.5.1 Policy Assistance to Facilitate a Shift from Sugarcane Farming in Dryland Areas

22. Sugarcane is generously subsidized and has done much to fuel rural prosperity among growers in Maharashtra. But its cultivation is also implicated in the overabstraction of groundwater. Though sugarcane is highly water intensive, requiring about 2,500 millimeters of water per hectare, it is grown on a vast scale in a region that is arid and has an average annual rainfall of 600 millimeters. Strong political support has seen the extension of irrigation command but these regions continue to need drinking water tankers during droughts. The support policies for sugarcane are complex and include administered prices, a proposed export subsidy, and implicit support through negligible user charges for water abstraction. With much of the sugarcane being cultivated on large irrigated farms, the subsidy is regressive, accruing disproportionately to the larger farmers. Climate change projections suggest a sharp decline in future sugarcane yields, which will bring intense pressure on the government to increase or maintain current subsidies, with undesirable fiscal consequences.

23. There is evidence that natural resource degradation is beginning to undermine the short-term benefits of unsustainable irrigation practices. Increased shortage of water and soil degradation have led to a significant reduction in the output and yields of the crop. Throughout the state sugarcane output has fallen sharply since 1999, despite a marginal increase in the area under production. Yields per hectare have also fallen, a trend clearly visible in drought-prone districts such as Ahmednagar (figure 4.9). Farmers with limited water supplies have experienced declines in yield from 80 tonnes per hectare to 25-40 tonnes per hectare. A handful of forward-looking farmers and community-based organizations in western Maharashtra have begun to abandon cane cultivation in favor of rain-fed traditional crops and intercropping practices for soil regeneration.

24. Looking forward, climate change would reinforce the many benefits from encouraging a shift from sugarcane to less water-intensive crop choices. But this will require concerted policy action. Targeted research and extension is needed to explore the possibility of equally lucrative alternatives to sugarcane as well as to help farmers to minimize the risks of changes in cropping patterns. However, the outcomes of research are always uncertain, so there is no assurance that a profitable substitute to sugarcane can be found. The elimination or modification of subsidies may be required to induce the required shift in cropping patterns. But as elsewhere this would inevitably provoke considerable resistance from the current beneficiaries. So the use of interim smart subsidies may be needed to shift incentives and cropping patterns in ways that are better suited to the state's agroclimatic conditions. Experience elsewhere, including in the European Union, Australia, and New Zealand, has shown that gradual changes are more acceptable and reforms can be accelerated when accompanied by other forms of support that target more benign activities.

[FIGURE 4.9 OMITTED]

4.5.2 Managing Groundwater Resources

25. As in Andhra Pradesh, integrated water management remains an overarching priority both for current and future agricultural development. Despite the projected increase in rainfall and runoff it is unlikely that water availability for agriculture will increase in the future with the growing demands of industry, demography, and expanding urban centers. Groundwater could play a major role in fueling sustainable rural economic growth. But for this to occur, abstractions need to be brought in line with recharge. The analysis in this report has shown that contrary to intent, groundwater dependence has failed to provide a buffer to many farmers in times of deficit rainfall. Unrestrained competition for groundwater has promoted water-intensive agriculture, leading to overabstraction and increased vulnerability to drought risks. For agriculture to become sustainable and drought resistant there is an urgent need to promote judicious water management, emphasizing both demand- and supply-side options.

Box 4.5 Role of Community Institutions and Participatory Water
Resource Management in Drought Adaptation

Several landmark examples can be cited from Maharashtra of
community-managed water resource management initiatives that have
resulted in significant local benefits to communities, including
improved natural resource management and livelihoods in low
rainfall environments.

Located in Ahmednagar district, the village of Hiwre Bazaar is not
covered by any major irrigation program; years ago, it was similar
to thousands of other villages in the same block without access to
any irrigation. However, effective watershed development and
management over the last 15 years have transformed the earlier
conditions and reaped positive developments in terms of ecosystem
restoration (for example improved soil moisture content) and
assured incomes from agriculture even during drought years. This
has also reduced outward migration. The village has developed its
own water regulations linked to its crop plans, which promote a mix
of vegetable and millet crops. Annual decisions on cropping
intensity ensure efficient management of the resource and its
equitable distribution for crop growth.

In Korhate village in Nashik, water user associations (WUAs)
administer water resource sharing for irrigation in major projects.
Water allocations are entirely based on cropping patterns and
associated volumetric allocations. The WUAs have been found to
function effectively and to distribute water equitably, ensuring
allocations to small and marginal farmers. Drip irrigation for
horticulture crops is promoted. The government of Maharashtra
further strengthened local bodies during 2005, empowering WUAs with
full legal authority to manage water distribution, maintain
irrigation channels, and resolve conflicts.

Initiated in the 1970s, the Pani Panchayat initiative in Pune
district prioritized drinking water in the village and restricted
the cultivation of water-intensive crops. There are currently 25
pani panchayat schemes in Maharashtra, based on either a
groundwater or surface water communal source. Within a pani
panchayat village, nearly a third of the village land is typically
brought under the scheme, which is managed under the principles of
delinking land and water rights and cultivation of only seasonal
crops. Hydrological parameters, such as groundwater level or
rainfall, are used to assess the amount of water that can be used
during the year for crop irrigation. These schemes have survived
several droughts successfully, but more recently there is evidence
that some of these initiatives may be endangered by gradual
overabstraction in the surrounding areas.

Sources: TERI 2007; DFID 2005a.

26. Solutions to the problem of groundwater overdraft are difficult to design and implement, as there are significant technical and institutional challenges in the management of groundwater at the higher aquifer or watershed levels where community-based management might occur. These include:

* Monitoring data are lacking and there are limitations in technical ability to quantify hydrological parameters such as flows, recharge, and water balance, which impede effective groundwater management. A wide array of watershed programs is in place across the country but their long-term impacts are poorly documented, including with respect to their ability to reverse the problem of groundwater overdraft.

* The creation of institutions and organizations capable of functioning at the level necessary for aquifer management remains a challenge, and financing models for these local management institutions still remain elusive.

* Despite fairly robust groundwater regulations, system managers have limited power to enforce regulations or penalties for violating the rules. So incentives for enforcing sustainability remain weak.

27. Recognizing these problems, numerous attempts are being piloted in Maharashtra to promote livelihood-focused adaptive approaches that provide community incentives to directly manage resources (box 4.5).

4.5.3 Strengthened Integration with Ongoing State Programs

28. There is potential in Maharashtra to build upon a wide range of relevant programs (box 4.6). But adaptive remedies and programs must endeavor to strengthen convergence with these ongoing programs to focus the impact of these programs on drought adaptation. For instance, the state has close to ten different watershed programs, each of which are implemented under a different set of guidelines and by different agencies. There is scope to integrate these guidelines into a unified framework for implementation to enhance outcomes with respect to financial allocation and institutions at various levels. The implementation of such programs can be encouraged by a consortium of organizations that have established models for scaling up innovative experiences in the states. Further, there is scope for enhancing synergies with the state Employment Guarantee Scheme (EGS) and the National Rural Employment Guarantee Scheme (NREGS) by integrating into the schemes a range of allied drought-proofing activities, including public works, the repair of tanks and community water storage facilities, land development, soil and water conservation, crop planning, and agroforestry.

29. Credit availability and poor marketing systems are crucial impediments to progress in drought-affected areas of Maharashtra. The small farmers remain dependent on moneylenders for routine credit required for inputs such as seeds, fertilizers, and pesticides. Efforts are needed to strengthen the availability of credit from public and private microfinance institutions to ensure effective access to credit. It is recognized, however, that several administrative bottlenecks impede effective access, as demonstrated in the low disbursal of the drought relief credit package announced by the government of Maharashtra for farmers in the Vidarbha region. But as suggested in the previous chapter, debt relief does little to tackle the root causes of the problem and needs to be accompanied by complementary mechanisms that provide incentives for income diversification. So there remains scope to pilot schemes that lower the costs of job mobility and income diversification, especially among the poor and vulnerable.

Box 4.6 Snapshot of Sectoral Programs in Maharashtra

Water Resource Programs

Investment in irrigation infrastructure is large and growing, yet
the irrigated area has stagnated at 16%. In addition, while
irrigation potential has increased, actual reservoir storage has
declined significantly, from 71% in 2000/1 to 59% during the peak
drought year of 2003/4, primarily due to siltation, poor
maintenance, and low rainfall. Funding is from a variety of
sources, including through state government funds and centrally
sponsored schemes, such as the Accelerated Irrigation Benefits
Programme, the Command Area Development Programme, and the Rural
mfrastructure Development Fund. The ongoing Maharashtra Water
Sector Improvement Project is assisted by the World Bank.

Watershed Programs

There are close to ten central and state-sponsored watershed
programs in the state, many of which operate in drought-prone
areas. In addition, the newly formed Marathwada and Vidarbha
Watershed Missions in Maharashtra aim to develop fallow and
underdeveloped land and groundwater tables in rain-fed areas. In
addition, a number of nongovernmental organizations, including the
Water Organizations Trust, the Bharatiya Agro Industries
Foundation, Marathwada Sheti Sahyog Mandal, and Action for
Agricultural Renewal in Maharashtra run their own watershed
programs in limited pockets. The watershed programs include
measures such as improved surface runoff collection structures,
better groundwater recharge, drainage line treatment, and increases
in vegetation cover.

Agriculture

Developing drought-resistant varieties has not been a major
initiative of the Department of Agriculture. However, dryland
horticulture (fruit crops requiring less water) has been promoted
with some success by the Horticulture Development Programme and is
linked with the state Employment Guarantee Scheme. Since 2005/6
this state-sponsored scheme has been merged with the National
Horticulture Mission, with funding being shared with the central
and state funds. The district-level agricultural technology
management agencies responsible for decentralized program planning
provide a useful vehicle for linkages and promotion of innovative
activities.

Rural Livelihoods

Swarnajayanti Gram Swarozgar Yojana is the single unified centrally
sponsored self-employment program for nonfarm-based livelihoods. It
aims to establish a large number of sustainable micro-enterprises.
The program targets families in rural areas that live below the
poverty line, providing them with income-generating assets through
a mix of bank credit and governmental subsidy.

Table 4.1 Socioeconomic Profile of Surveyed Households in Maharashtra

Land category     Ownership    Ownership       Share of
(% of total       of utility   of productive   agricultural
households)       assets (%)   assets (%)      income (%)

Large (28%)       25           15              86
Medium (47%)      21           8               78
Marginal (6%)     24           3               66
Landless (19%)    4            0               67

Land category     Mean                         Access to
(% of total       normal       Years of        health
households)       income (Rs)  Schooling       facility (%)

Large (28%)       17,453       6,636           62
Medium (47%)      10,031       11              82
Marginal (6%)     4,611        11              88
Landless (19%)    4,319        9               63

Table 4.2 Outlays and Expenditures for Drought Relief and Sectoral
Programs,

Tenth Five Year
Plan (2002-2007)    Amount         Drought and flood damages
total outlay        (Rs billion)   and relief

Agriculture and     45.97          Drought damages and relief
  allied services                    (2003/4)
Rural development   61.99          Flood damages and relief
  (a)                                (2005/6)
Irrigation and      44.89          Planned EGS outlay (2202/7)
  flood control
  works
Total               152.75

Tenth Five Year
Plan (2002-2007)    Amount
total outlay        (Rs billion)

Agriculture and     57.21
  allied services
Rural development   90.30
  (a)
Irrigation and      27.98
  flood control
  works
Total               175.49

(a.) Since the Employment Guarantee Scheme (EGS) also acts as a
drought relief program, the planned EGS outlay for 2003-04 has
been taken out of the rural development component of the Tenth
Five Year Plan outlay and added to the relief expenditure and is
an underestimate of true expenditures which are higher.

Source: Government of Maharashtra 2006. Annual Plan 2006-07:
Maharashtra State Part II, Planning Department,
Government of Maharashtra, Mumbai.