ADB Loan to Boost Water Efficiency in Rural Western PRC

News Release | 21 March 2011

MANILA, PHILIPPINES - The Asian Development Bank (ADB) is providing a $60 million loan to improve water efficiency in three agricultural counties in Qinghai Province in the west of the People's Republic of China (PRC).

Qinghai Province, located in the upper Yangtze and Yellow River valleys, is one of the poorest provinces in the PRC because of its remote location, mountainous landscape, and extreme climate. Two thirds of its population live in rural areas but farming has suffered in recent years because water has become scarcer and the water infrastructure is poor. That has reduced wheat yields to around 76% of the national average and exacerbated poverty. Around 39% of those in the targeted counties of Hualong, Jianzha, and Xunhua live on less than the PRC government's official poverty line of CNY1,196 per year.

ADB's loan is part of a $223.6 million project to build four new main irrigation canals, branch canals, and on-farm works to convert the aged small lift irrigation systems to gravity irrigation systems. The Qinghai provincial government and the county governments will finance the balance of the project. When the project is finished in September 2016, the gravity irrigation systems will serve about 14,000 hectares of agricultural land in the three counties. Irrigation water use efficiency should go up to around 56% from the current 35% and irrigation costs for the farmers will drop sharply.

"Promoting better use of irrigated water - with lower energy use - makes environmental sense but will also help the struggling farming community in the region," said Yaozhou Zhou, Water Resources Management Specialist in ADB's East Asia Department. "We'd expect this project to help increase harvests and boost average farmers' incomes to about CNY5,000 a year by 2020 from about CNY3,000 a year now."

The project will also help set up Water Users Associations to develop water delivery schedules, promote water conservation measures, and help farmers improve their skills in crop production and selection. In other parts of the PRC, such associations have been successful in boosting water use efficiency and, by involving the farmers themselves, ensuring water systems continue to run well in the longer term.

ADB estimates that about 130,000 farmers will benefit directly from the project. The vast majority of the farmers in the project area are from the Hui, Salar, and Tibetan ethnic groups which have inhabited the region for more than 700 years.