836
August 2002
Amer. J. Agr. Econ.
global groundwater overdraft is 163 km3. Uti-
lizing the Postel estimate of groundwater over-
draft, the threshold point at the whole-basin
level at which localized groundwater overdraft
occurs is set at 0.55. Using this benchmark,
a number of basins and countries experience
groundwater overdraft in the base year, in-
cluding the Rio Grande River Basin and the
Colorado River Basin in the western United
States, where the ratio of annual groundwa-
ter pumping to recharge is greater than 0.6,
the Hai-Luan River Basin in northern China,
where the ratio is 0.85; several river basins in
northern and western India with ratios in ex-
cess of 0.8; Egypt, with a ratio of 2.5; and other
WANA, with a ratio of 0.8.
It is possible for regions and countries that
are unsustainably pumping their groundwa-
ter to return to sustainable use in the future.
The low groundwater pumping (LGW) sce-
nario assumes that groundwater overdraft in
those countries/regions unsustainably using
their water will be phased out over the next
25 years through a reduction in the ratio of an-
nual groundwater pumping to recharge at the
basin or country level to below 0.55.
Compared with levels in 1995, under
LGW, groundwater pumping in these coun-
tries/regions will decline by 163 km3, includ-
ing a reduction by 11 km3 in the United States,
30 km3 in China, 69 km3 in India, 29 km3 in
WANA, and 24 km3 in other countries. The
projected increase in pumping for areas with
more plentiful groundwater resources remains
almost the same as under the baseline scenario,
and total global groundwater pumping in 2025
falls to 753 km3, representing a decline from
the value in 1995 of 817 km3 and from the base-
line 2025 value of 922 km3.
in world prices generates production increases
that more than compensate for the direct re-
ductions due to the fall in groundwater pump-
ing. The elimination of groundwater overdraft
would also cause a fall in global soybean pro-
duction of 1.9 million mt (0.8%), in potato pro-
duction of 4.3 million mt (1.1%), and in sweet
potatoes of 1.5 million mt (0.7%). Production
of cassava and other sweet potatoes, which is
virtually all rainfed, will actually increase by
1.8 million mt (0.7%), as increases in prices of
other staples shifts some demand to cassava,
pushing up prices and inducing slightly higher
production.
Although substantial, the estimated global
production cost of elimination of ground-
water overdraft is much less than that calcu-
lated by some analysts. For example, using an
estimate that it takes 1000 m3 of water to pro-
duce1000kgofcereal, Postelestimatesthatthe
approximately 160 km3 water deficit is equal
to 160 million tons of grain. But a significant
amount of overdraft water is for non-cereal
crops; the amount of reduction of cereal pro-
duction due to 1000 m3 less overdraft of water
is considerably less than 1000 kg (560 kg/
1000 m3 for rice and 390 kg/1000 m3 for non-
rice cereals in the developing world according
to our estimates); and the cereal price effects of
the cutback in pumping induces partially off-
setting increases in area and yield.
Instead, the biggest impacts under LGW are
concentrated in the basins that currently expe-
rience large overdrafts. Cereal production falls
by 14 million mt in India, with a few basins par-
ticularly hard hit, including the Ganges basin,
which has a decline in cereal production of
8 million mt, and the Indus basin, where ce-
real production falls by 4 million mt. In China,
Phasing out of groundwater mining would cereal production falls by 17 million mt, includ-
reduce total cereal production by 17 million ing 8 million mt in the Haihe River Basin and
mt from baseline projections in 2025. Irrigated 6 million mt in the Yellow River Basin. Ce-
cereal production will decline by 35 million real demand also falls in these countries, with
mt, but rainfed production will increase by a 3.5 million mt drop in cereal consumption in
18 million mt, because the shortfall in irrigated India, 3.1 million mt in China, with the differ-
production results in price increases that stim- ence made up by increased imports. Compared
ulate increased rainfed production. Interna- with the baseline scenario, LGW results in an
tional wheat prices are projected to be 11% increase of cereal imports of 7.0 million mt in
higher in 2025 than baseline projections, rice India, 6.5 million mt in China, 1.7 million mt in
prices 7% higher, and maize prices 6% higher. WANA and 0.8 million mt in other developing
Total developing country cereal production countries, in 2021–25.
declines by 27 million mt in the LGW scenario
Simulations of improvements in basin irriga-
compared to the baseline, with irrigated pro- tion efficiency targeted within the overdraft-
duction declining by 34 million mt and rainfed ing basins show that water sector policies to
production increasing by 7 million mt. Cereal compensate for the loss in production and con-
production actually increases by 10 million mt sumption from reduced groundwater pumping
in developed countries because the increase would require a focus beyond the basins most