Widespread adoption of efficient irrigation technologies, including drip irrigation, has been proposed as a means of limiting groundwater over-exploitation, especially in the intensively farmed and water-stressed South Asia region. This paper reports on a randomized control trial conducted in the Indian state of Andhra Pradesh to evaluate the potential productivity and water-savings benefits of small-holder drip irrigation. A group of well-owners was encouraged to adopt drip irrigation through a subsidy scheme, whereas a control group was left to its own devices. The results indicate that, after 3 years, the drip group shifted into more remunerative and irrigation reliant crops, enjoyed higher agricultural revenue, and transferred (primarily through cash sales) more of its groundwater to adjacent plots. In terms of groundwater pumping, which has zero marginal price in this setting, there is precisely zero difference between drip and control groups. The evidence thus suggests that drip adoption in South India, while increasing irrigation efficiency, will not save groundwater.
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