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Reservoir water reallocation and community welfare.pdf

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  • The introduction of culture-based fisheries (CBF) in small scale irrigation systems is increasing the marginal value of water in rice farming. The amount of water that is used in Sri Lanka for rice farming could be utilised to generate more profitable non-crop economic activities such as CBF. This paper examines whether the re-allocation of water to more efficient, high return uses would increase the total economic welfare of farmer community. Primary data was collected from 460 rice farmers in the Kurunegala District and 334 fish farming groups in two districts (Anuradhapura and Kurunegala) in Sri Lanka. The estimation of the value of water used for rice farming and CBF production is derived from the marginal value product by estimating stochastic translog frontier production functions. We then derive benefit calculations on the basis of the water demand functions for rice and CBF. Reducing the inefficient usage of water in rice farming by 32% increases the volume of water which can be used for CBF production by 53%. This greater efficiency can increase, farmers' total net benefits by 17% per Metres/ha of water used for reservoir-based agriculture. But in order to achieve this benefit, it is critical to ensure the water rights of the multiple users of small scale irrigation systems. This paper recommends introducing a community transferable quota, combined with co-management of water resources, to enhance the welfare of fishing and farming communities which use small scale irrigation systems.
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