Watershed programmes in India are contributing to water resources development, agricultural production
and ecological balance. Conventional methods to value them using financial measures attempt to quantify
the impacts of watershed development in an isolated manner. In order to evaluate the impacts of watershed
programmes in a holistic manner, the Economic Surplus (ES) approach has been applied using the data
from a cluster of 10 watersheds in the Coimbatore district of Tamil Nadu. The distributional effects of
watershed programmes are also captured through the ES method. Hence, possibilities of using this
methodology in the future watershed evaluation programmes could be examined. The study has suggested
that people’s participation, involvement of Panchayati Raj Institutions, local user groups and NGOs
alongside institutional support from different levels, viz. central and state government, and district and
block levels should be ensured to make the programme more participatory, interactive and cost-effective
