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The policy decision to provide free or subsidized electricity has been a key driver for widespread groundwater exploitation in India. Groundwater utilization has immensely enhanced crop productivity and employment generation, which has led to poverty reduction and rural prosperity. To boost rural development in the 1970s, state government, initially began unmetered electricity supply for irrigation, which is still being continued in different states as part of their rural development policy. Policy planners and administrators are now faced with the challenge to design and implement a workable mechanism to manage the evergrowing complexity of groundwater - energy nexus. Groundwater extraction has already surpassed sustainable utilization limits in most parts of India.