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Abstract
Major and Medium (M&M) irrigation projects in India have lost its importance to ground water minor irrigation projects due to their financial problems resulting ostensibly from the highly subsidised and stagnant canal irrigation charges. This study examines financial performance of M&M irrigation projects during pre-reforms and post-reforms period and explores if higher irrigation charges may improve both irrigation efficiency and share of cost recovery. It has been found that during post-reforms period the M&M irrigation projects have faced problems of inadequate cost recovery coupled with continuous reduction of expenditure on ‘maintenance and repair’ which have led to reduction of irrigation efficiency. We have also found that only increasing the irrigation charges by the states may not bring about higher irrigation efficiency rather, it would be prudent on the part of the concerned state governments to wind up the revenue departments and assign the responsibility for collection of users’ charges to the Gram Panchayats that will improve the financial performance of the M&M irrigation projects and also increase efficiency of the canal irrigation.