The paper generated under the Challenge Program for Water and Food (CPWF) project explores in some depth a totally different dynamic in the irrigation economy of the vast Indo-Gangetic basin (IGB), an important exception to the global characterization. The global debate on ‘‘water as an economic good’’ presumes that irrigation water supply is delivered, controlled, and priced by public institutions. In the developing world, the price of water is kept so low that water use cost leaves farmers no incentive to use it efficiently.
From this characterization emerges the battle cry to get the water prices right. When water prices are very low, the debate argues, tinkering with them does not result in efficiency improvements. Getting the price right may then mean raising the water price above the threshold beyond which water demand begins responding to price increases.
The paper shows that at least in South Asia, a major irrigating region of the world, this characterization needs a reality check. In the region where irrigation is viewed as an instrument to alleviate agrarian poverty, the dominant emerging trend is the opposite of what the ‘‘water-as-an-economic good’’ debate highlights.
The paper makes the following observations:
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