Problems, Principles and Policies
Edited by Phoebe Koundouri, Panos Pashardes, Timothy M. Swanson and Anastasios Xepapadeas
Chapter 2: The Political Economy of Institutional Reforms in Pakistan’s Irrigation Sector
2. The political economy of institutional reforms in Pakistan’s irrigation sector Jean-Daniel Rinaudo and Zubair Tahir* 2.1 INTRODUCTION Since its creation by the British at the end of the nineteenth century, the Indus basin irrigation system, which supplies water to a total area of 16 million hectares, has been managed by a public administration (the Provincial Irrigation Department), which is in charge of the design, operation, maintenance and resolution of conﬂicts in each irrigation scheme. It is now widely acknowledged that this irrigation bureaucracy has not adequately met the requirements of an administered system. It has increasingly relied on subsidies from the provincial budget, as the operation and maintenance expenditures have increased faster than the revenue collected from water charges (Strosser, 1997). The hydraulic infrastructure has not been properly maintained, leading to a poor overall performance of the system. The productivity of water has been stagnant, and the administrative discipline has rapidly deteriorated, resulting in widespread rent-seeking and corruption, together with illegal water trading at diﬀerent levels of the system (Rinaudo, Strosser and Thayer, 2000; Rinaudo, Thayer and Strosser, 1997). In a context of increasing macroeconomic imbalances, international lending agencies, such as the International Monetary Fund (IMF) and the World Bank have urged the government of Pakistan to reduce its public expenditures in the irrigated agriculture sector. In 1993, the World Bank proposed to the government of Pakistan (GOP) a scenario for reform, suggesting a reduction in the role of the government and an increase in the participation...
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