BENEFIT-COST ANALYSIS WATER RESOURCE MANAGEMENT Western Rajasthan: Expansion of Irrigation through Improvements in Water Use Efficiency in RAJASTHAN Authors Dr. Dinesh Kumar Executive Director Institute for Resource Analysis and Policy (IRAP), Hyderabad © 2018 Copenhagen Consensus Center [email protected] www.copenhagenconsensus.com This work has been produced as a part of the Rajasthan Priorities project under the larger, India Consensus project. This project is undertaken in partnership with Tata Trusts. Some rights reserved This work is available under the Creative Commons Attribution 4.0 International license (CC BY 4.0). Under the Creative Commons Attribution license, you are free to copy, distribute, transmit, and adapt this work, including for commercial purposes, under the following conditions: Attribution Please cite the work as follows: #AUTHOR NAME#, #PAPER TITLE#, Rajasthan Priorities, Copenhagen Consensus Center, 2017. License: Creative Commons Attribution CC BY 4.0. Third-party-content Copenhagen Consensus Center does not necessarily own each component of the content contained within the work. If you wish to re-use a component of the work, it is your responsibility to determine whether permission is needed for that re-use and to obtain permission from the copyright owner. Examples of components can include, but are not limited to, tables, figures, or images. Western Rajasthan: Expansion of Irrigation through Improvements in Water Use Efficiency and Rejuvenation of Traditional Water Harvesting Systems Rajasthan Priorities An India Consensus Prioritization Project Dr. M. Dinesh Kumar Executive Director Institute for Resource Analysis and Policy, Hyderabad Working paper as of April 16,2016 ACADEMIC ABSTRACT ...................................................................................................................................... 1 POLICY ABSTRACT ............................................................................................................................................ 2 BACKGROUND ........................................................................................................................................................ 2 THE PROBLEM ........................................................................................................................................................ 2 INTERVENTION 1: EXPANSION OF IRRIGATION ............................................................................................................. 3 Overview ....................................................................................................................................................... 3 Implementation Considerations .................................................................................................................... 4 Costs and Benefits ......................................................................................................................................... 4 Costs ........................................................................................................................................................................... 4 Benefits ...................................................................................................................................................................... 4 INTERVENTION 2: RENOVATION OF TRADITIONAL WATER HARVESTING SYSTEMS ................................................................ 5 Overview ....................................................................................................................................................... 5 Implementation Considerations .................................................................................................................... 5 Costs and Benefits ......................................................................................................................................... 6 Costs ........................................................................................................................................................................... 6 Benefits ...................................................................................................................................................................... 6 BCR TABLE ............................................................................................................................................................ 8 1. INTRODUCTION .......................................................................................................................................... 15 2. EXPANSION OF IRRIGATION ....................................................................................................................... 16 2.1 DESCRIPTION OF INTERVENTION ......................................................................................................................... 16 2.2 DATA ............................................................................................................................................................ 18 2.3 LITERATURE REVIEW ........................................................................................................................................ 18 2.4 CALCULATION OF COSTS AND BENEFITS ............................................................................................................... 21 2.4.1 Calculations ........................................................................................................................................ 24 2.5 ASSESSMENT OF QUALITY OF EVIDENCE ............................................................................................................... 25 2.6 SENSITIVITY ANALYSIS ...................................................................................................................................... 26 3. RENOVATION OF TRADITIONAL WATER HARVESTING SYSTEMS ............................................................... 26 3.1 DESCRIPTION OF INTERVENTION ......................................................................................................................... 26 3.2 DATA ............................................................................................................................................................ 27 3.3 LITERATURE REVIEW ........................................................................................................................................ 27 3.4 CALCULATION OF COSTS AND BENEFITS ............................................................................................................... 29 3.4.1 Calculations ........................................................................................................................................ 30 3.5 ASSESSMENT OF QUALITY OF EVIDENCE ............................................................................................................... 32 3.6 SENSITIVITY ANALYSIS ...................................................................................................................................... 32 4. CONCLUSION ............................................................................................................................................. 32 5. REFERENCES ............................................................................................................................................... 36 Academic Abstract This research paper is part of the India Consensus project undertaken by the Copenhagen Consensus and Tata Trusts which aims to promote greater focus on effective solutions for the country, informed by evidence of the benefits and costs of various interventions and policies. This paper evaluates the benefits and costs of two developmental interventions in the water sector that were identified for the state of Rajasthan namely ‘Expansion of Irrigation through improvements in Water Use Efficiency’ and ‘Renovation of Traditional Water Harvesting Systems’. Expansion of irrigation in the desert region of western Rajasthan through lifting canal water into diggies and using it for irrigation through sprinkler system and selection of crops that are less water-intensive enables farmers to take up crop production even in undulating land, having saline groundwater, thereby reducing irrigation water application requirements. An evaluation of the benefits and costs of such an intervention, arrived at by comparing the amount of water required to attain the income from a sprinkler irrigated plot under the traditional irrigation method using the same amount of water as consumed in the sprinkler irrigated plot, put the private, economic and social benefit-cost ratios at 2.25, 2.02 and 2.92 respectively, considering a discount rate of 5%. The other intervention, Khadins, are runoff-harvesting systems which store water from the rocky catchments in the soil profile of the reservoir bed, for later use in crop production. A benefit- cost analysis of the direct income benefits of enhanced crop production in the khadin bed due to rejuvenation of the Khadin as well as the indirect benefits arising from improved recharge of groundwater in the shallow aquifer due to large water storage in the khadin, indicates a private benefit-cost ratio of 2.55 and a social benefit-cost ratio of 2.68 at a discount rate of 5%. Sensitivity analysis shows that both the suggested interventions are valuable even at a higher discount rate (8%). It is expected that these interventions will find their place in the