This paper presents a smart solar water pumping system with the grid interactive features using an induction motor drive. To alleviate the burden on the electrical grid, solar PVs (SPV) can be used to power up the agricultural and irrigational loads. The system is designed not only to provide the rated discharge of water but also to feed the surplus power to the grid. The SPV array is operated at the maximum power (MPP) point ensuring its efficient utilization by monitoring the power output of the SPV array. Four different modes of operation of the system are identified and a universal control for all the modes is proposed. The uninterrupted operation of the pump is ensured even in the absence of the grid. A variable frequency inverter (VSI) operates the induction motor. Moreover, a voltage source converter (VSC) is used for the bidirectional flow of power in the proposed system. The system is modeled in the MATLAB/Simulink and the simulated results demonstrate the effectiveness of the proposed system in integrating the SPV source into the grid.