Journal of Management & Public Policy, Vol. 2, No. 1 December 2010 37 A Scenario Testing of Canal Irrigation Cooperatives for Multiple Use Services: A Case study of Major Irrigation Project in Gujarat (India) Gurulingappa G. Koppa * & Debiprasad Mishra ** Abstract India has cautiously embarked on a process to transfer the management of public irrigation systems to Water Users’ Associations/ Irrigation Cooperatives (ICs), with the stated objectives of providing sustainable and adequate financing for operation and maintenance and of facilitating investment in the required rehabilitation of irrigation and drainage systems. It is likely that most of the failed co-operatives are weak in their financial position. There is a need to find out the various critical factors that ensure financial strength of the ICs, and the various steps taken by the co-operatives to increase their revenue for better financial management. The study tries to identify and analyze the scope for charging multiple use of water including domestic, livestock and industrial purpose by making non farming users as members of the irrigation cooperatives, assess the capacity of the farmers/non farmers to pay and elicit the conscious steps taken by the government and farmers for ensuring the financial strength of ICs. The study refers to a multi- disciplinary approach which involves simulations and scenario-testing, acknowledging that there are costs incurred by supplying water and water-related services to farmers and other users. The farmers tap into their monetary resources to pay these water service fees. The outcome of the study suggests that there is a need to include non-farmers as members with a membership fee and charge non-farm uses to make ICs financially sustainable in the long run. Keywords: Financial Viability, Irrigation Cooperative, Livestock, Multiple Use, Sustainability, Water rates. Introduction Over the last two decades, irrigation researchers, policy-makers, and donor agencies have become increasingly disenchanted with state managed large-scale irrigation systems (GoI, 1992; Hussain and Hanjra, 2004; World Bank, 2006) and have shifted their focus to farmer managed irrigation systems (Watson et al., 1998). The shift has occurred parallel to a trend to decentralize water management programs from the state to local users (Parker and Tsur, 1997). Irrigation management transfer or Participatory Irrigation Management has become a widespread strategy in Asia, Africa, and Latin America. It often includes demand management to encourage efficient water allocation and imposes new externalities on irrigation systems in terms of environmental performance (Vermillion, 1997). Increasingly, local management solutions are being sought for global problems of food and other resource (Ostrom 1990). * Fellow Programme Participant, Institute of Rural Management Anand, and Consultant, International Water Management Institute Colombo, Regional Office Anand,388001, Gujarat, India Email: gurugkoppa@yahoo.com ** Professor, Institute of Rural Management Anand388001, Gujarat, India