China Watch
February 26, 2001

The Chinese government recently passed a new regulation on water management, updating its system of use permits and stipulating charges for water consumption in agriculture. According to officials in the State Council (China’s parliament), the move is expected to enforce water-saving measures in irrigation and motivate farmers to economize on water use. The regulation will take effect on April 15 of this year. Building on an earlier permit system enacted in 1993, the ruling outlines the process for applying for water-use permits and explains the fee system for water taken directly from rivers, lakes, or underground. According to the regulation, provincial governments at the headwaters of these resources are responsible for setting the fee levels, though the central government will oversee charges for central and cross-provincial water conservation projects. The new regulation could affect agriculture production by imposing extra costs on farmers. In certain situations, however – such as if the water is taken from their own ponds and reservoirs or is used for daily consumption – farmers are not required to apply for intake permits or pay usage fees. Water use within a certain quota is also not charged, which will exempt a large number of individual producers. (Excerpt)