Although irrigation projects often provide water for more than crop irrigation, water allocation and management decisions often do not account for nonirrigation uses of water. Failure to account for the multiple uses of irrigation water may result in inefficient and inequitable water allocation decisions. Decision-makers often lack information on the relative economic contributions of water in irrigation and nonirrigation uses. This report addresses this problem. It examines the relative economic contributions of irrigated agriculture and reservoir fisheries in the Kirindi Oya irrigation system, located in Southeastern Sri Lanka. The results of the analysis indicate the importance of both irrigated paddy production and reservoir fisheries to the local economy. They also demonstrate significant potential financial and economic gains to irrigated agriculture from improvements in water management practices. Since these water uses are interdependent, policy makers must consider how changes in water management practices may affect reservoir levels and water quality and the fisheries that depend on them.

Water is being transferred out of agriculture to meet the growing demand in other areas, often without an agreement of or compensation to farmers with irrigated land and water rights. Furthermore, there is a failure to recognize that irrigation systems supply water not only for the main fields, but also for domestic uses, home gardens, trees and other permanent vegetation, and livestock. Other productive uses include fishing, harvesting of aquatic plants and animals, and a variety of other enterprises such as brick making. In addition, irrigation systems can have a positive or negative effect on wildlife habitats. Thus, the withdrawal of water affects the rural household, rural economy, and the environment in a number of ways. This paper argues that to ensure efficient, equitable, and sustainable water use, to reduce poverty and improve the well-being of the community, irrigation and water resources policies need to take into account all uses and users of water within the irrigation system. The multiple uses of water in the Kirindi Oya irrigation system are examined in this paper. An interdisciplinary group of scientists have investigated a number of areas including water accounting, water quality, household water use, the valuing of water for alternative uses, and the complementarities, competition, and conflicts among uses and users.

The purpose of this report is to produce a review on water resource valuation issues and techniques specifically for the appraisal and negotiation of raw (as opposed to bulk or retail) water resource allocation for agricultural development projects. The review considers raw water in naturally occurring watercourses, lakes, wetlands, soil and aquifers, taking an ecosystem function perspective at a catchment scale, and takes account of the demands from irrigated and rainfed agriculture. It is hoped that the review will have particular application to developing countries where agreed methods for reconciling competing uses are often absent, but nevertheless takes account of valuation approaches that have been made in post industrial economies.

Water provides benefits as a commodity for agriculture, industry, and households, and as a public good such as fisheries habitat, water quality and recreational use. To aid in cost-benefit analysis under conditions where market determined price signals are usually unavailable, economists have developed a range of alternative valuation methods for measuring economic benefits. This volume provides the most comprehensive exposition to-date of the application of economic valuation methods to proposed water resources investments and policies. It provides a conceptual framework for valuation of both commodity and public good uses of water, addressing non-market valuation techniques appropriate to measuring public benefits - including water quality improvement, recreation, and fish habitat enhancement. The book describes the various measurement methods, illustrates how they are applied in practice, and discusses their strengths, limitations, and appropriate roles. In this second edition, all chapters have been thoroughly updated, and in particular the coverage of water markets and valuation of ecosystem services from water has been expanded. Robert Young, author of the 2005 edition, has been joined for this new edition by John Loomis, who brings additional expertise on ecosystem services and the environmental economics of water for recreational and other public good uses of water.

This book contains 14 separately authored chapters on the pricing of irrigation water. The chapters are entitled: (1) Water pricing in irrigation: the lifetime of an idea; (2) Water pricing in irrigation: mapping the debate in the light of experience; (3) Why is agricultural water demand unresponsive at low price ranges; (4) Get the prices right: a model of water prices and irrigation efficiency in Maharashtra, India; (5) Thailand's free water: rationale for a water charge and policy shifts; (6) Water rights and water fees in rural Tanzania; (7) Who will pay for water? The Vietnamese State's dilemma of decentralization of water management in the Red River Delta; (8) Water pricing in Haryana, India; (9) The energy-irrigation nexus in South Asia: groundwater conservation and power sector viability; (10) Wells and canals in Jordan: can pricing policies regulate irrigation water use; (11) Water pricing in Tadla, Morocco; (12) Water pricing policies and recent reforms in China: the conflict between conservation and other policy goals; (13) Water pricing and irrigation: a review of the European experience; and (14) Policy-driven determinants of irrigation development and environmental sustainability: a case study in Spain.

Today, raising capacity in water resources management entails supporting stakeholders and decision-makers to reach a common understanding on the priorities and necessary arrangements for sharing and allocating water-related goods and services. Valuation is central to this process, as setting priorities and making choices implies valuing certain uses and arrangements above others. Water valuation can help stakeholders to express the values that water-related goods and services represent to them. It also offers a means for conflict resolution and planning, informing stakeholders, supporting communication, and facilitating joint decision-making on priorities and specific actions. This report confronts concepts from the literature on water valuation with practical experiences from three local cases where an effort was made to embed existing valuation tools and methods in ongoing water resources management processes. It uses the lessons from this exploration to provide a first outline for a stakeholder-oriented water valuation process. This is expected to provide a useful starting point to help water professionals and policy-makers improve the use of water valuation as a means to support participatory processes of water resources management.

Abstract: Many countries are reforming their economies and setting macroeconomic policies that have direct and indirect impact on the performance of the irrigation sector. One reason for the movement toward reform in the water sector across countries is that water resources are increasingly becoming a limiting factor for many human activities. Another reason for increased pressures to address water policy issues is that many countries are in the process of removing barriers to trade, particularly in agricultural commodities. Therefore, knowledge of the value of water when crafting domestic and macroeconomic policies is important to compare the variable impacts of reform across sectors of the economy and populations within the country. Researchers have used many methods for assessing the value of irrigation water. This survey reviews a broad literature to ascertain how two basic questions have been addressed by research over the past few decades. First, what is the value of water across different sectors and levels? Second, how will this value change under different macroeconomic and domestic policies? This survey details a number of methods for approaching these two questions. The literature has been organized according to a progression from theoretical underpinnings to empirical approaches to how the value of irrigation services are relevant to the link between globalization and poverty.

This report reviews several decades of global experience in transferring management of government-run irrigation systems to farmer associations or other nongovernmental agencies in an attempt to apply the lessons of success to the African smallholder irrigation context.

Smallholder irrigation systems–where farm sizes generally range from a fraction of a hectare to 10 hectares–pose special management problems, especially where the water available for irrigation is frequently less than the demand. The intensity of system adjustments required to meet individual farmer demands, and the administrative complexity of measuring and accounting water deliveries have generally proven excessive when attempting to meet “on demand” schedules, resulting in chaos (often characterized by illegal tampering with infrastructure, and vast differences of water use intensity at different locations in the system). The alternative–provision of a simple service, based on proportional sharing of available supplies on the basis of landholdings–has been resilient for many years over vast areas. The approach is based on a clear delineation between the part of the irrigation system that is actively managed (at various flow rates and water levels) and the part of the system that operates either at full supply level (with proportional division of water down to the level at which farmers rotate among their individual farms), or is completely shut. This operational design is known as a “structured” system, and has well-defined hydraulic characteristics, simplifying operation and management, in turn allowing a clearer definition of water entitlements and the responsibilities of agency staff and farmers. The approach is particularly suited to areas where water is scarce and discipline is needed to ration water among users. An additional benefit, which has been demonstrated in modeling studies using a well–proven model relating to water and yield, is that the productivity of water (which is more important than the more traditional productivity of land when water is scarce) is substantially increased when deficit irrigation is practiced–a widely observed and predictable response to rationed water supplies. Structured systems are most suited where water is scarce, clear definition of water entitlements is needed, management capacity is limited, and investment resources are limited. The approach to determining critical aspects of a structured system design is described in this report.