The depletion of groundwater resources due to irrigation water pumping in Iran has become a serious problem which threatens both rural life and sustainable development in the country. The latest estimates show that 70% of groundwater resources have been overexploited in the last 15 years. Intensive and ever-increasing use has become one of the primary reasons behind the devastation of groundwater resources, both quantitatively and qualitatively. For many years, huge energy consumption subsidies (electricity or gasoline) have been provided for pumping irrigation water from aquifers. The resulting cheap energy makes deep water pumping possible and huge investment in deepening and relocating wells feasible. Since the reforms appear to be very difficult to implement on the political level, we focus on the political economy of subsidy provision for irrigation water and energy for pumping in Iran. We analyse how the interests of rural inhabitants are represented in Iranian parliament and examine the decision-making process of the parliamentarians in voting for eliminating the subsidies. Results show that Iranian leaders follow the logic of regime maintenance and may have incentives to strategically overrepresent rural interests in the parliament. Importantly, we found that the decision to support subsidies for irrigation water is motivated by economic factors rather than by ideological incentives. Political economy appears to be a useful framework to understand the obstacles of phasing out subsidies depleting not only ground water resources but the state budget as well
