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The Use of Participatory Tools in Water Allocation Policy
There are several studies suggesting that public investment in dams has not led to expected returns either in terms of government revenues or farm productivity (Singh 1997; Dharmadhikary et al. 2005). However, this did not persuade the state governments to stop the policy of building dams during the first phase of economic reforms. In fact, the budgetary allocation for constructing, operationalizing and maintaining dams has kept on increasing. The revenue receipts from water charges were not adequate to support the budgetary allocation. Financial constraints were evident. This is why the process of the second phase of reforms was undertaken with technical and financial support from international financial institutions like the World Bank. The focus was now on institutional reforms, including among other things the establishment of an IRA, rationalizing of water tariffs and creation of a system of tradable water rights (World Bank 2005).
The State of Maharashtra was one of the first to begin with this type of reform process in 2002-2003. The World Bank was the 'knowledge partner' in this process. The important reforms included adoption of a State Water Policy (SWP) and establishment of the Maharashtra Water Resources Regulatory Authority (MWRRA). Formulation of this policy framework began in 2002. While the SWP was formulated and adopted by the Government in 2003, the MWRRA Act was passed in 2005. This is the point where an attempt was being made to develop a distinct policy sphere, in which decisions could be made based on evidence rather than vested interests.
Consultation with stakeholders and the public has been the modus operandi of World Bank-led reform processes. Hence, participatory tools were used in various policy formulation stages under a government-led venue. In this case, stakeholder consultation workshops were conducted by the Water Resources Department (WRD). Headed by a Minister, it has all the characteristics of a government-led policy venue.
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