supply management was supply driven, harnessing more and more of the available water resources to supply the rising demands. A notable feature of water resources management was to address the uneven distribution of resources in time and space and to redistribute water when and to where people wanted it. However, some countries have been more successful than others in this respect. Whereas arid rich countries such as the United States and Australia have built over 5 000 mi of water storage per capita, and middle-income countries like South Africa, China and Mexico can store about 000 mi 3 per capita, India by comparison can only store 200 m³. Given the enormous scale of investment involved, most development projects relied on government funding and management in one form or another. The World Commission on Dams estimated that USD 2 trillion had been spent building some 45 000 dams in the 20th century (WCD, 2 000) and that annual investment was running at USD 40 billion (not all for water resource purposes). Only when resource constraints, economic factors and environmental concerns started to become significant issues did it occur that traditional approaches such as large dams and reservoirs may no longer be the solution. New water infrastructure projects have become increasingly expensive compared with other alternatives, placing a strain not only on existing budgets but also on future income streams. There has been a growing appreciation that issues of social equity and ecosystem integrity have to be included in decisions. Systems of public water provision often insulate the public utilities from the influence of the market, restricting their very ability to respond to increasing needs or changes in service standards. Politicians, in responding to equity concerns and/or short-term gain, often keep prices for infrastructure services below cost recovery, making service providers dependent on politically motivated budgets (World Development Report, 2004). Arising from the demands of urban groups of consumers with g