Chinese Agricultural Water Resource Utilization in 21st Century

Firstly, the present situation of China’s water resources and its implications are discussed. As a large country, China is nonetheless resource poor on a per capita basis. With the development of industrialization and urbanization, more and more water resources will be transferred from low-value agricultural use to high-value industrial and residential uses. The challenge now facing irrigated agriculture is how to resolve the contradiction between increasing food demand and decreasing water supply without undermining the growing cities and industrial sector. Secondly, the problems of agricultural water utilization in China are presented: low efficiency, severe water pollution, inequitable distribution, and severe land erosion. Shortage and waste coexists in Chinese irrigated agriculture. Thirdly, an analysis of the causes of inefficient Chinese agricultural water utilization is provided: attenuated property rights, artificially low water prices, lack of user participation in irrigation districts management, fragmented government management, and lack of a compensating mechanism between upstream and downstream users. Against the background of a transitional economy, the lack of economic incentives is because of the inadequately institutional settings, so it is necessary to allocate the water resource through the market. Finally, feasible measures for addressing the problems are given: to establish non-attenuated property rights, to establish an effective price system, and to foster the main body of the market.