Returns on investment in farm pond construction and maintenance

Abstract

Water scarcity in the semi-arid Latur district of Maharashtra adversely affects agricultural productivity. This study assesses the financial feasibility and return on investment (ROI) of constructing and maintaining farm ponds as a sustainable irrigation strategy. A purposive sampling of 120 farmers (60 farm pond users and 60 non-users) from six talukas was undertaken. Data were collected through personal interviews and analyzed using standard cost concepts, farm income measures, and discounted cash flow methods including Net Present Value (NPV), Benefit-Cost Ratio (BCR), Internal Rate of Return (IRR), and Profitability Index (PI). Results indicated a significant increase in cropping intensity (from 190.57% to 247%) and introduction of summer cropping due to farm pond use. Financial analysis revealed lined and unlined ponds to be economically viable, with BCR’s of 1.35 and 1.31 and IRRs exceeding 108%. The study concludes that farm ponds enhance water security, increase farm income, and are sustainable investments for farmers in drought-prone areas.