A low-cost photovoltaic (PV) pumping system based on three phase induction motor (IM) without the use of chemical energy storage elements is presented in this paper. The PV generator-side boost converter performs the maximum power point tracking (MPPT), while the IM side two-level inverter regulates the net DC-link voltage and the developed electromagnetic torque by IM, which is coupled with a centrifugal pump..An improved variable step size perturb and observe (P&O) algorithm is proposed to reduce the steady-state PV power fluctuation, to accelerate the tracking operation under sudden irradiance changes, and to protect IM under load drops. The proposed algorithm is based on a current control approach of the boost converter with a model predictive current controller to select the optimal control action. Moreover, predictive torque and flux control (PTC) is used to control IM drive, due to its advantages such as faster torque response, lower torque ripple, and simplicity of implementation. Furthermore, a Takagi-Sugeno (T-S) type fuzzy logic controller (FLC) is developed in order to regulate the DC-link voltage, by producing the torque reference for PTC algorithm. In order to examine and assess the performance of the proposed control scheme for PV pumping system, a complete simulation model is developed using MATLAB/Simulink (TM) environment and confirmed through real-time hardware in the loop (HIL) system. The obtained results indicate the excellent performance of the proposed control scheme, which is much better than the conventional scheme based on conventional techniques (P&O algorithm and direct torque control (DTC)).