14. Estimated Cost of Surface Water and Payment for Ecosystem Services (PES) for Water

Being a vital, valuable and indispensable resource, water is also the prime ecosystem service of the nature. Irrigation being the largest user of water (92 %) in India, the discipline in water use in agriculture is crucial, resulting in water savings. Water literacy and payment for ecosystem services (PES) are sine –qua non for bringing water use efficiency and in educating consumers regarding the PES for water for system efficiency. How the state can adopt an implementablePES with high accountability and low transaction cost is demonstrated in this chapter. The cost of surface water estimated is proposed to be collected through an effective payment vehicle in order to reduce the transaction cost of collection. The purpose of this chapter is to educate the users of water (largely the consumers), regarding their obligation to pay those who are conserving the ecosystem which in turn contributes to hydrological flows. This study highlights the contribution of farmers of Kodagu who are responsible for maintaining / preserving / conserving the biodiversity in Bramhagiri which is responsible for water flows in Cauvery river. Unless the downstream areas in Karnataka, Tamilnadu which largely are the beneficiaries of Cauvery water appreciate the conservation efforts of Kodagu farmers, by the way of PES, there will be no incentive for upstream farmers towards conservation. The society will then pay a heavy price for such a lapse. It is therefore necessary for creating awareness regarding the benefits enjoyed by water users due to efforts of upstreamers and hence the need for PES. At present in India, surface water cost is administratively determined as water rate in different States. Obviously this is highly subsidized. However even this subsidized water rate is usually not paid by farmers. Hence the PES is suggested.