Iran's Agricultural Exports Policy from the Perspective of Virtual Water and Its Economic Value

Document Type : Original Article

Authors

Faculty of Civil Engineering, K. N. Toosi University of Technology, Tehran, Iran

Abstract

Export is an essential part of trade, and is the main mechanism of any country to increase its economic growth. It would be prudent for countries facing water stress to consider the role of Virtual Water besides the economic aspects of exports. This would, in turn, lead to more purposeful export strategies while preserving valuable domestic water resources. Here, a three-step framework is presented to judge how to export better-targeted products in the agricultural sector, as the largest water-consuming sector of Iran, where water shortage is currently one of the main national challenges. The framework is established based on two indices: Price and Revenue. The price index stands for the cost that must be paid, and the revenue index measures the economic value earned from exporting a certain amount of Virtual Water hidden in sold products. Comparison of these two criteria between Iran and the World trade can lead to maximizing incomes from exports and minimizing domestic water resource consumption. The efficiency of the proposed approach was investigated for six exported agricultural products: dates, pistachios, and saffron as the most well-known international brands of Iran's agricultural industry, and tea, rice, and watermelon as the representative water-intensive products during 2005-2016. The results show that the current states of exports have unfavorable conditions both from the perspective of water resources exploitation and export incomes. Furthermore, the results show that the proposed framework can provide a better platform for considering not only export incomes, but also volume and economic value of exported Virtual Water.

Keywords

Main Subjects

References

  1. Madani, K. Water Management in Iran: What Is Causing the Looming Crisis? Journal of Environmental Studies and Sciences, 2014; 4 (4): 315–328. doi:10.1007/s13412-014-0182-z.
  2. Allan, J. A. Fortunately there are substitutes for water: otherwise our hydropolitical futures would be impossible. In: Proceedings of the Conference on Priorities for Water Resources Allocation and Management: Natural Resources and Engineering Advisers Conference; 1992 Jul; Southampton,,United Kingdom. London: Overseas Development Administration; 1993. p. 13–26.
  3. Vos, J., Boelens R. The politics and consequences of virtual water export. In: Smetana S, Bornkessel S, editors. Eating, drinking: surviving. Cham: Springer International Publishing; 2016. p. 31–41. doi:10.1007/978-3-319-42468-2_4.
  4. Orlowsky, B., Hoekstra, A. Y., Gudmundsson, L., Seneviratne, S. I. Todays Virtual Water Consumption and Trade under Future Water Scarcity. Environmental Research Letters, 2014; 9 (7): 74007. doi:10.1088/1748-9326/9/7/074007.
  5. Kumar, M. D., Singh, O. P. Virtual Water in Global Food and Water Policy Making: Is There a Need for Rethinking? Water Resources Management, 2005; 19 (6): 759–789. doi:10.1007/s11269-005-3278-0.
  6. Kounina, A., Margni, M., Bayart, J. B., Boulay, A. M., Berger, M., Bulle, C., Frischknecht, R., Koehler, A., Milà I Canals, L., Motoshita, M., Núñez, M., Peters, G., Pfister, S., Ridoutt, B., Van Zelm, R., Verones, F., Humbert, S. Review of Methods Addressing Freshwater Use in Life Cycle Inventory and Impact Assessment. International Journal of Life Cycle Assessment, 2013; 18 (3): 707–721. doi:10.1007/s11367-012-0519-3.
  7. Distefano, T., Kelly, S. Are We in Deep Water? Water Scarcity and Its Limits to Economic Growth. Ecological Economics, 2017; 142: 130–147. doi:10.1016/j.ecolecon.2017.06.019.
  8. Berger, M., Van Der Ent, R., Eisner, S., Bach, V., Finkbeiner, M. Water Accounting and Vulnerability Evaluation (WAVE): Considering Atmospheric Evaporation Recycling and the Risk of Freshwater Depletion in Water Footprinting. Environmental Science and Technology, 2014; 48 (8): 4521–4528. doi:10.1021/es404994t.
  9. Lee, S. H., Yoo, S. H., Choi, J. Y., Mohtar, R. H. Evaluation of External Virtual Water Export and Dependency through Crop Trade: An Asian Case Study. Paddy and Water Environment, 2017; 15 (3): 525–539. doi:10.1007/s10333-016-0569-4.
  10. Guan, D., Hubacek, K. Assessment of Regional Trade and Virtual Water Flows in China. Ecological Economics, 2007; 61 (1): 159–170. doi:10.1016/j.ecolecon.2006.02.022.
  11. Mekonnen M. M., Hoekstra A. Y. National water footprint accounts: the green, blue and grey water footprint of production and consumption. Delft: UNESCO-IHE Institute for Water Education; 2011. Report No.: 50. (Value of Water Research Report Series).
  12. Soltani, G. Agricultural water-use efficiency in a global perspective: the case of Iran. Cairo: Economic Research Forum; 2013 Oct. Working Paper No.: 778.
  13. Baghestany, A. A., Mehrabi Boshrabadi, H., Zare Mehrjerdi, M., Sherafatmand, H. Application of the Concept of Virtual Water in Water Resources Management of Iran. Iran-Water Resources Research, 2010; 6(1): 28-38.
  14. Faramarzi, M., Yang, H., Mousavi, J., Schulin, R., Binder, C. R., Abbaspour, K. C. Analysis of Intra-Country Virtual Water Trade Strategy to Alleviate Water Scarcity in Iran. Hydrology and Earth System Sciences, 2010; 14 (8): 1417–1433. doi:10.5194/hess-14-1417-2010.
  15. Ward, F. A., Michelsen, A. The Economic Value of Water in Agriculture: Concepts and Policy Applications. Water Policy, 2002; 4(5): 423–446. doi:10.1016/S1366-7017(02)00039-9.
  16. Wang, Y. B., Liu, D., Cao, X. C., Yang, Z. Y., Song, J. F., Chen, D. Y., Sun, S. K. Agricultural Water Rights Trading and Virtual Water Export Compensation Coupling Model: A Case Study of an Irrigation District in China. Agricultural Water Management, 2017; 180: 99–106. doi:10.1016/j.agwat.2016.11.006.
  17. Chowdhury, N. T. The economic value of water in the Ganges-Brahmaputra-Meghna (GBM) River Basin. Stockholm: Beijer International Institute of Ecological Economics; 2005
  18. Isfahan Municipality. Isfahan statistical yearbook 2015–2016. Isfahan: Isfahan Municipality; 2016.
  19. Zheng, Z., Saghaian, S., Reed, M. Factors Affecting the Export Demand for U.S. Pistachios. International Food and Agribusiness Management Review, 2012; 15 (3): 139–154.
  20. Food and Agriculture Organization of the United Nations. Report of the Working Group on Global Tea Market Analysis and Promotion: Intergovernmental Group on Tea. Rome: FAO; 2015.
Civil Engineering and Applied Solutions
Volume 1, Issue 1
June 2025
Pages 53-67

Files

Share

How to cite

Statistics