Rural economic revival hinges on resolving the water-energy nexus in farming

The resurgence of the objective of Indian self-reliance in recent weeks has shone light, albeit belatedly, on the considerable disconnects that pervade rural life in the country. Translating India’s undoubted potential for self-sufficiency will have to begin with addressing these gaps, particularly in agriculture which still remains India’s biggest livelihood.  The myriad disconnects in India’s agriculture are clearly seen in the governance structures in the water, energy and market access which are dealt with by different input providers and output guarantors with sub-optimal coordination.

If we focus on the water-energy-food nexus; energy is an input to get water which, along with other agri-inputs determine farm sector opportunities. Levels of inputs needed in the farming sector change with climatic regions, soil conditions and access to market. Despite the diversity in the soil fertility and resource availability (water and energy); what matters the most to the rural community is the livelihood. In affluent regions such as Punjab and Haryana the annual farming incomes can go up to INR 1 lakh per acre and can be as low as INR 35,000 in the climatically challenging arid regions of Maharashra and Andhra Pradesh, which represents skewed opportunities for those who depend on farming incomes. Piecemeal solutions to create energy security and water security have worked but this sector can benefit from a well-rounded solution to meet not only livelihood objectives, but also the escalating challenges on the climate front.

The agriculture sector employs over 45% of India’s population and contributes to approximately 18% of the GDP. There is little question that a lack of resources will compound any vulnerabilities emerging from climate-change. In the post-COVID-19 era, which has  seen mass exodus from cities and reverse migration; creating robust solutions in the rural sector has rapidly gained prominence. It’s now become more important than ever to focus on non-urban income opportunities – one can’t ignore the importance of protecting the natural systems while doing so.

Energy-water-food nexus has been known and talked about for a few decades already. In rainfed or an irrigated agriculture region in India, it’s a vicious cycle of lack of water resources leading to higher energy consumption with no assurance of agricultural productivity and livelihood. More often than not, the sector may try to maximize short-term gains of cropping yields while damaging the natural web of resources including water and soil. This creates short-term gains but long-term shocks leading to depletion of groundwater tables, higher electricity use with lack of assurance of yield and livelihood. Several experts have talked about the detrimental choices leading to paddy cultivation in northwestern states of India.

The entire focus of the farming community needs to be directed towards conservation of natural endowment – water and soil quality – which ensure long-term sustained yield and livelihood.

This sector is often blamed for non-payment of electricity bills and causing financial distress to electricity companies, but we seldom recognize that farmers do not get reliable electricity. Poor voltage levels further create the need for rewinding motors, the costs of which are not even considered. Surveys suggest an annual maintenance cost of INR 3,000 for a 5 HP pump, which adds to the input costs of the farmers. Would urban cellphone users accept free airwaves if it meant real risks of  damage to cellphones and unreliable quality of reception which could lead to potential financial losses?

Do we know how to solve the water-energy conundrum in agriculture? Yes, several examples of water conservation including drip systems, use of precision agriculture, energy efficient pump-sets and more recently the use of agriculture land to develop solar power exist. In the recent discussion with farmers of a small electricity cooperative in Gujarat, it was evident that installing solar-PV systems and exporting electricity to the local distribution utility yielded good revenues – in some cases higher than even farming revenues. Farmers in the Jawahar Taluka in the tribal region of Maharashtra created an interesting example of using solar pumps in a mini-grid with central storage, and watering the plants at dusk or dawn when microbial activity was most favorable for plant growth.

Some of these examples point to the power of cooperation. Success achieved through the formation of cooperatives in the water, electricity and market accessibility through water users’ associations, electricity cooperatives and farmers’ producers’ organizations (FPOs) respectively are known. Key success factors of running cooperatives include low-cost of farm inputs, reliability of electricity and water as inputs, and creating market opportunities commanding reasonable price-lock-ins through better negotiations with the off-takers. This is an important transition from a vicious to a virtuous cycle. Farming communities and those who support them have a good opportunity before them. Without arguing if the recently announced COVID-19 stimulus package goes far enough in addressing rural economic distress, it is an opportunity nonetheless to focus on creating a vibrant rural economy through “rural industrialization” with the additional workforce that’s now available. The stimulus package promises to offer market access through amendments to the essential commodities act; offering independence to the farmers to sell the produce in non-APMC markets. The agri-infrastructure fund of INR 1 Lakh crore could offer an opportunity to the cooperatives to manage their input costs, sell some produce in the market and create substantial post-harvest food processing infrastructure. A provision of 50% subsidy on transportation from surplus to deficient markets and 50% subsidy on storage including cold storage infrastructure as pilot initiatives; extending the Operation Greens from tomatoes-onions-potatoes to all fruits and vegetables adds to extended livelihood opportunities. The stimulus also talked about creating micro food enterprises through a budget provision. These opportunities cannot be missed.

What’s needed is for the urban population to support the farming community through innovations such as the community supported agriculture and diving deep to create a climate-resilient farming sector. Caution is needed to ensure the stimulus is not used to create short-term gains alone but is used to create a robust renewable-energy-based village infrastructure, managing the water resources, cooperatively and post-harvest food processing units, creating FPOs that can add value to the produce and create export linkages. Real call to act is to connect these dots to create resilience in the farming community as well as staying afloat despite the potential impact of climate change and economic shocks.

Views expressed in the post are personal.

About The Author

Mahesh Patankar

Mahesh Patankar is the Managing Director at MP Ensystems, the interim consulting India Director at the Regulatory Assistance Project (RAP), and a senior advisor – disruptive technologies, 2030 Water Resources Group.
Views expressed in blog posts are personal.

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