This study conducts a systematic comparison for investments undertaken in 2008–2016. Across various assessment frames, the findings converge around the following: costs of irrigation investment are simply too large in comparison with expected benefits; none of the project worth indicators reach threshold levels; rather, the benefit-cost ratio (BCR) tends to fall below unity; internal rate of return (IRR) estimates tend to fall below the hurdle rate of 10 percent; and net present value (NPV) estimates tend to fall below zero.
A key limitation of our analysis is that it incorporates benefits only from incremental rice output. Rather than invalidating the government’s irrigation planning and investment allocation, our benefit-cost analysis makes a case for: more skeptical treatment of irrigation area targeting; and stricter application of benefit-cost analysis, with emphasis on credible projections of both crop and non-crop benefits.
