| Water scarcity is a major concern for arid and semiarid regions around the world. Increasing population, growing food demands, living standards, and the potential impact of climate change pose additional challenges on the wise use of existing limited water resources. Therefore, better management that increases the economic efficiency, sustainability, and equity of water use to meet those needs is required. In Egypt's part of the Nile Basin, the country historically faced those challenges with little attention given to economic principles of water use in the irrigation sector. Most previous research has ignored the regional interdependence of water, which makes it geographically, hydrologically, and economically limited. Another case of weak water institutions and poor infrastructure is found in the Balkh Basin, Afghanistan. In addition to limited water supply, that basin lacks significant storage capacity that could be used for better management of irrigation water over sequential periods of drought and flood cycles. This dissertation addresses those gaps by developing an integrated basin management framework that improves the water economic efficiency and sustainability in both countries with possible application to other places. The integrated basin framework acknowledges the multidimensional aspect of the water by incorporating hydrology, economics, institutions, land use, policy applications, and water supply scenarios within a single unified framework. Using farm budget data, a dynamic non-linear programming framework is developed for each country that maximizes the national discounted net value of irrigation water. This framework is modified in the case of Afghanistan to maximize economic benefit from irrigation water and storage capacity for several proposed reservoir storage plans. Findings illustrate that the economic efficiency of irrigation water could increase for Egypt, while securing the country' environmental, urban, and cultural needs through applying limited water trading instruments. When applied to Afghanistan, results show diminishing marginal impact of the additional reservoir capacity on regional and national farm income for the Balkh Basin. Our results provide insights for policymakers, farmers, farmer associations, and water managers to improve water use economic efficiency and sustainability. The framework has applicability for wide range of conditions in dry regions that face important challenges in the management of water resources. |
