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Water and Development: The Importance of Irrigation in Developing Countries
Transcript

Water and Development: The

Importance of Irrigation in

Developing Countries

The Importance of Water

• 80% of the human body is made up of water.

• Water is a crucial element of our food and environment.

• 75% of the earth’s surface is made up of water.

• Only 3% is fresh water. • Only 1% of the water is suitable for

human consumption.• Much of this water contains chemicals

that make it unsuitable for human consumption.

• We distinguish between quality of water and quantity of problems.

• On average, we have sufficient water to meet human needs. The problem is water distribution.

Heterogeneity of Water • There are differences in water availability

within regions. In Brazil, Mexico, California, Hawaii, and Russia, there are flood regions and deserts.

• Differences in water availability over time matter. During the same year you may have periods of flooding and shortages.

• Differences in water quality are crucial. Consumption, farming of various crops, and production require water above the appropriate minimum quality.

• Value and use of water are dependent on: – Location– Time– Quality

California Leading Crops

Commodity 1988 Value Harvested Acreage

Share ofUS

Production

WaterApplication

Rate

Value fromWater

Applied($000) (000 acres) (percent) (AF per acre) ($ per AF)

Rice 197,583 420 18.5 7.8 60Hay, alfalfa, other 817,614 1,680 6.8 4.8 102Beans, dry 104,473 150 15.0 3.5 199Cotton 1,026,633 1,337 18.3 3.4 229Sugar beets 178,080 212 21.4 3.6 235Wheat 164,860 519 2.4 1.2 263Walnuts 190,962 174 100.0 2.8 396Prunes, dried 113,925 77 100.0 3.2 462Almonds, shelled 600,075 407 99.9 3.0 493Processing tomatoes 385,669 226 88.4 3.2 534Grapes, all 1,356,250 654 91.6 3.3 636Oranges, all 458,446 172 26.0 3.2 843Potatoes 143,673 47 4.8 3.6 851Pistachios 104,340 44 100.0 2.8 853Broccoli 265,954 101 90.9 2.8 940Avocados 205,200 75 86.1 2.8 980Peaches, all 177,880 54 58.7 3.2 1,023Cauliflower 161,514 48 79.2 2.8 1,202Lemons 171,436 49 82.3 2.8 1,252Lettuce 632,424 160 73.0 2.6 1,517Fresh tomatoes 264,075 38 25.0 4.0 1,761Carrots 247,366 51 65.1 2.6 1,874Apples 117,750 23 6.9 2.5 2,048Strawberries 388,998 18 73.9 2.9 7,621

TOTAL 9,457,649 7,745

0%20%40%60%

80%100%120%

0% 20% 40% 60% 80% 100% 120%

45° line

Cumulative Water Use

Cum

ula

tive

Valu

e

Different Uses of Water • Consumptive usage is diversion +

consumption of water through:– Transforming it into water vapor

(where it is “lost” in the atmosphere),

– Letting it seep into the ground – Significantly degrading its quality.

Examples:• Residential• Industrial• Agricultural• Forestry

• Non-consumptive usage. Does not reduce water supply and, frequently, does not degrade water quality. Examples:

– Fisheries use water as a medium for growing fish.

– Hydroelectric users extract energy from the water.

– Some recreation uses water as a medium (example: swimming) and/or extracting energy from the water (examples: white-water rafting, surfing)

– Transportation is an especially important use of water in the tropics.

Agricultural Values of Water Vary

• Agricultural value of water varies between crops and locations. A relatively small fraction of the water (20%) generates much of the value (more than 70%).

• Crops such as flowers and strawberries can pay more than $500/AF of water, cotton can afford paying $40-$100/AF, and pasture $30/AF and less.

• Values of water vary by location and land quality and are determined by market conditions.

• Industries and residential users can afford to pay much more than agricultural field crops. Their demand is relatively small (33%) but is continually growing.

Overview of Irrigation

• Irrigated land has increased from 50mha (million hectares) in 1900 to 267mha today.

• Between 1962 and 1996, the irrigated area in developing countries increased at 2% annually.

• Irrigation has been crucial in meeting the food demands of a doubling world population since WWII.

• Irrigation projects have been costly in terms of capital, environmental degradation, and human health.

• Design and management of water resources have been flawed. There is a growing perception of water supply crisis, but what we have is a water management crisis.

• As the population is likely to grow (double) again, we need to reform water institutions and policies.

• This presentation first assesses the water situation and then introduces directions for reform.

Benefits of Irrigation• Irrigation increases crop yield. The 17% of

irrigated land produces 40% of the global food.• The value of production of irrigated cropland is

about $625/ha/year ($95/ha/year for rain-fed cropland and $17.50/ha/year for rangeland).

• Irrigation affects total factor productivity (TFP) beyond the input value of the water (Evenson, Pray, Rosegrant).

• Irrigation allows improved timing and spatial distribution of water. It allows double cropping and enables stabilization of supply and production of vegetables and fruits.

• Irrigation increases consumer well-being and employment as well as farm income (net income increase per family in Africa was $150 - $1000).

• The high productivity of agriculture slowed expansion of deforestation.

Productivity of Irrigation• Just et al. found the water share

to be .21 using Israeli data.• Tfp of water is .11-.2.• These are, however, marginal

effects.• There is a significant fixed

effect of water.• There is significant

heterogeneity within fields; 35% of yield variance is within

fields.The high yields from irrigation may reflect climatic effects. Desert areas have higher sun energy and degree days that, with irrigation, lead to higher yields.

Modern irrigation and pumping modify ranking and values of land. Irrigation technologies are water-quality augmenting.

Water Productivity in Agriculture• About 70% of the consumptive use of water is in

agriculture. Productivity is measured by net value generated (excluding environmental side effects) and depends on location, time, crop, and irrigation technology.

• Irrigation efficiency is the ratio of effective water (water consumed by crop) to applied water. Land quality and irrigation technology affect irrigation efficiency. It is low at steep hills & with flood irrigation. Sprinkle and drip irrigation improve efficiency.

• Higher efficiency reduces residue and slows waterlogging. It results in higher yield. Decisions whether or not to adopt depend on trade-off between gains in yield and water saving and extra cost on water management.

• Not all water conservation technologies require modern equipment. Terracing of steep hills is one example, and there are many more.

• Adoption of efficient irrigation technologies can be triggered by higher prices of water or penalty to residues.

Water Projects• Projects modify bodies of water to enhance

some aspects of productivity. These projects may include:– Navigation– Storage– Flood protection– Hydroelectric

• Projects may have negative environmental and social effects.

• A correct analysis of net discounted benefits is a useful guide for project selection. It should account for nonmarket impacts and uncertainties.

• Project design should consider institutional and nonstructural solutions. Redesign of incentives may lead to water savings, preventing a need for a new dam.

Virtual Water

• This concept is used by noneconomists to deal with water use heterogeneity and to justify trading.

• Value of water varies by location. Defining a water shortage as a situation where water per capita is below a certain level is not always useful when a region with minimal water can use it productively and generate resources to buy cheap water-intensive crops.

• For example, an acre foot of water used in flower production is equivalent in the value of productivity to 30-40 acre feet used in wheat.

• Measure of water shortages should combine water availability and productivity. Water constraints are less binding as trade opportunities expand.

Scarcity, Government Power, Preferences, and the Emergence of

Water Institutions• Water abundance + financially weak government

+ desire for growth lead to water rights (prior appropriation).

• Water abundance + financial resources availability + desire for growth lead to public supply projects + subsidies.

• Water scarcity leads to water trading. • Financial crunch leads to privatization of

supplies.• Environmental concerns lead to water quality

regulations + environmental purchasing funds.• Equity concerns leads to regulated pricing +

subsidies.

Actions to Improve Efficiency of Irrigation

• Efficient investment in irrigation projects

– Capital subsidies and under-pricing the environment lead to oversized projects.

– Full capacity is not needed to start the project. Over capacity is needed to deal with uncertainty.

– Learning is crucial; delay is worthwhile. Invest when it is optimal not at first moment when NPV is positive

– Project design should include institutions for allocation.

– Consider waterlogging cost and drainage in project design.

• Trade and the concept of “virtual water.” Forget self- reliance. Use water for best outcome build storage and trade.

Inefficiencies in Micro-Level Water Management

• Farmer selection of crops and irrigation technologies affect water use.

• Conservation technologies increase water use efficiency but require higher per acre cost.

• There is 6% adoption of sprinkler and 1% adoption of drip.

• There are low tech “drip”-like technologies. • Low pricing of water does not justify adoption.• Efficient pricing of water and drainage will lead

to adoption.

Conclusions• More impact assessment of irrigation and more

econometric studies of performance are needed.• Irrigation is crucial to productivity. Some

systems are not sustainable because of overpumping.

• There is much potential to increase water productivity through incentives.

• One priority is to increase trading within regions and to improve maintenance through institutional changes.

• Irrigation technologies and improvement in varieties are other sources of improved water productivity in agriculture.

• Water management is a major challenge. Cost benefits are needed to improve investment choices and to integrate agricultural and environmental and urban water uses. The main challenge is efficient irrigation at the regional level.


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