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Abstract
The cost and marketing of groundwater have been assessed in the Nalanda
district, which is one of the most agriculturally advanced districts of the
Bihar state. For the study, 60 farmers have been randomly selected from
the district. It has been found that small and marginal farms use their
tubewells mainly for hiring, whereas, large and medium farms use them
mainly for their own purposes during the main crop seasons, i.e. kharif
and rabi. The average installation cost on a tubewell has been found
highest on large size of holdings (Rs 33,130), followed by medium (Rs
27,240), small (Rs 23,850), and marginal (Rs 19,610) holdings. The capital
budgeting techniques, viz. net present value (NPV), benefit-cost ratio
(B:C ratio) and internal rate of return (IRR) have been used for evaluating
the investment on tubewells. The NPV has been found positive (Rs 1440)
and B:C ratio more than one (1.05:1). The IRR has been estimated to be
more than the capital cost (10.95%). But, the tubewells have failed to
generate income flow equal to the investment by marginal farms. Farm
size-wise analysis has revealed that the owner-seller farms category
predominates in the water market in the study area. The participation in
water market has been found to decline with increase in the size of farms.
Financial analysis has revealed that the installation of tubewells is
financially viable on large and medium farms but not on small and marginal
farms. However, with the development of water market in the area, adoption
of modern technologies in crop production and cultivation of cash crops
would make the installation of tubewells on marginal and small size of
farms financially viable.