Abstract
The current study shows that the recent diesel price hike had an insignificant impact on irrigation costs incurred by diesel well owners in eastern India. Further, analysis of the farming enterprises of diesel well owners and water buyers from both diesel and electric wells confronted with a differential cost of irrigation water showed that farmers would be able to cope with a very high rise in irrigation costs through irrigation efficiency improvements and allocating more area to crops that give higher returns per unit of land and water. By doing this, they are able to maintain the farm returns.
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