This document is the fourth in the series of ten Policy Papers to be prepared under the IMPSA Program. It is based primarily on five Staff Working Papers on the issues related to the topic. Many factors affect the productivity and profitability of irrigated agriculture, but it is generally agreed that inefficient management of irrigation systems is a key cause of the low performance of these systems. It is also agreed that the underlying causes of this inefficient management lay in the realms of institutions and government policies. If the government can get its policies right, and if the institutional constraints to implementing these policies can be overcome - then it is likely that people will invest in improved technologies. use the factors of production more efficiently, and thereby increase the productivity and profitability of irrigated agriculture.