Rapid economic growth in the Yellow River Basin (YRB) of China has put intense demands on Yellow River waters. By far the largest user of water resources is the agricultural sector, accounting for 80 percent of total withdrawals—with industrial, urban, and rural domestic sectors sharing the remaining 20 percent. Demands for irrigation have surpassed available resources for decades. Given that water is critical for agricultural production, access to water is a key determinant of welfare of the rural poor in the YRB region for whom agriculture is the main source of livelihood.
This brief is based on a water-related poverty analysis for the YRB region conducted in 2009 by IFPRI in collaboration with the Center for Chinese Agricultural Policy. Most of the data for the analysis come from the 2001 Household Income and Expenditure Survey conducted by the National Bureau of Statistics of China. The purpose of the analysis is to determine to what extent agricultural water management explains poverty in relation to other factors such as safe drinking water, education, and agricultural and off-farm incomes. This assessment is important for understanding which agricultural water interventions result in the highest impact on poverty reduction.