Introduction
Agricultural projects normally support intensification of existing practises in food production or improvements/changes of production processes. In the case of irrigation projects, considerable investments are required, either for new construction or rehabilitation of hydraulic infrastructure. Furthermore, the following operation and maintenance of the investments need funds. Investors, like banks and donors want to base their decisions on realistic assessments of the investments and of the expected benefits. Financial analysis is usually part of the project appraisal, and of the (pre)feasibility study. The investment costs (for land purchase, for civil works, like canals, headwork etc.) are estimated as well as the operation and maintenance (O&M) costs and the production costs.
References
FAO (2002) : Financial and Economic Appraisal of Irrigation Projects. ftp://ftp.fao.org/agl/aglw/docs/irrigman11.pdf [accessed 17 April 2013]
