Economic assessment of the investment in soil and water conservation projects of watershed management
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ORIGINAL PAPER
Economic assessment of the investment in soil and water conservation projects of watershed management Jamal Mosaffaie 1 & Amin Salehpour Jam 1 Received: 11 February 2018 / Accepted: 19 June 2018 # Saudi Society for Geosciences 2018
Abstract In order to ensure investments in soil and water conservation projects, impact assessment and economic analysis of these projects are necessary. The purpose of this study was economic evaluation of watershed management practices in Parrud catchment of Qazvin Province, Iran. For this purpose, the changes caused by the implemented projects (including various biological, biomechanical, mechanical, and managerial practices) are measured quantitatively. Then, the total costs of the implemented measures along with the revenues from the changes were calculated. Lastly, the economic evaluation of the project is carried out using net present value (NPV) method. The results show that 115,000 m3 more runoff storage has been carried out annually. Also, there has been an increase of 163.9 t/h/year in the total rangeland production and 57.6 increase in hectares of the area of orchards, and the erosion rate has dropped from 13.98 to 10.23 t/h/year. Economic appraisal of the projects indicates that during the first 5 years, the costs have risen, but since the sixth year, the NPV has increased so it has been positive since the eighth year onwards and will increase continually. These results demonstrate cost-effectiveness of the watershed management projects, and therefore, there is enough confidence to invest in these projects. Keywords Net present value (NPV) . Hydrological conditions . Erosion and sedimentation . Vegetation . Secure investment
Introduction Decision-making and planning are the most important tasks of managers and engineering economic techniques help managers to make correct and timely decisions (Bigdeli and Ehtesham Raee 2011). Making a decision to invest is a very important part of using an organization’s resources, and it affects the continuity of the investment for projects. Economic analysis of a project is carried out with the aim of securing investment and determines the value of investment and profits for the life of the project (Dinmohammadi and Bagheri Bastami 2014). Economic analysis of a project is usually done before the project begins and involves predicting
* Jamal Mosaffaie [email protected]; [email protected] Amin Salehpour Jam [email protected] 1
Soil Conservation and Watershed Management Research Institute (SCWMRI), Agricultural Research Education and Extension Organization (AREEO), 10th Km. of Karaj special road, Shahid Asheri St., Shahid Shafiee St, P.O. Box 13445-1136, Tehran, Iran
the expected profits and losses of the project; therefore, accurate prediction of revenues and costs is required. Rapid population growth in recent decades, especially in developing countries such as Iran, has increased the pressure on renewable natural resources to such an extent of creating the grounds for their rebellion (Rashvand
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