The component of reclamation of water logged areas in the commands of the CAD projects was included under CADWM Programme with effect from 1 April 1996. The main objective of this component is to reclaim waterlogged areas in the irrigation commands caused either on account of surface flooding/inundation or due to rise in water table and bring back the degraded land to productive use. Under this component, 50 % Central assistance is provided to States in the form of grant.

Till 2003-04, bio-drainage was not included under the component of reclamation of waterlogged areas under the CADWM Programme. The cost norm for sub-surface drainage system was the same as for surface drainage system. Under the restructured CADWM Programme implemented from the financial year 2004-05, the cost norm for reclamation of water logged areas was increased from Rs. 12000 per ha to Rs. 15000 per ha (for execution of surface drainage, bio-drainage etc.) and to Rs 40,000 per ha (for sub surface drainage). Thus, an amount of Rs 7500 and Rs 20,000 per ha (or 50 % of actual expenditure whichever is less) is reimbursable to States under this component as central grant for surface/bio drainage and sub surface drainage respectively.