NATIONAL BANK FOR AGRICULTURE RURAL DEVELOPMENT

(NABARD)
The National Bank for Agriculture Rural Development (NABARD) has adopted a
policy not to provide refinance in critical and over-exploited areas. NABARD has
prescribed spacing norms for different types of areas whereby the minimum
distance between two groundwater abstraction structures can be indicated
(IRM&ED, 2008).According to the NABARD regulation, the farmers do not get
credit for a new bore well if it is located within 200 m radius of an existing bore well.
Such restrictions are also imposed by other nationalized banks. Field research has shown
that credit regulation was not very effective due to the availability of other credit avenues
(mainly informal sources) at the village level (Kumar, 2007). This is despite the fact that
the cost of credit from informal sources is high. The credit rationing policy of the banks is
also trying to curb new power connections to bore-wells and place restrictions on electric
power supply.Besides, enforcement is also lax due to the pressure on banks to achieve
targets.
The Punjab Government has recently introduced the Punjab Preservation of Sub-Soil
Water Ordinance 2008, which prohibits the planting of paddy by the farmers in testate
before June 10, in order to conserve groundwater. The ordinance provides for the
government agencies to plough the area with the standing crop of such farmers who
transplant paddy before the notified date. The effectiveness of this order dissuading
farmers from sowing early paddy, thereby conserving groundwater is, however, is yet
tobe seen.
A model bill to regulate and control development of groundwater has been circulated by
the Ministry of Water Resources (MoWR) to all the States / Union Territories (UTs).So
far, 11 States/UTs including AP, Goa, Tamil Nadu, Kerala, West Bengal, Bihar,Himachal
Pradesh, Chandigarh, Lakshadweep, Pondicherry, and Dadra and Nagar Haveli have
enacted and implemented groundwater legislation. However, the effectiveness of their
implementation and enforcement is not known.Some success in reducing groundwater
draft through regulatory measures have reportedly been made in a few water-scarce
countries such as Jordan, where a quasi-water policy requires measuring withdrawals
from the irrigation wells, enforcement of pumping quotas and levy of volumetric
groundwater fee (The World Bank, 2000). However, the situation is more complex in
countries such as India where millions of individual private tube well owners, dispersed
through the length and breadth of the country with varying groundwater availability and
demand conditions, are engaged in groundwater extraction.