Agricultural Goods

During the recent years, water deficiency has been lead to innovation of modern techniques for saving water in countries which suffered from the shortage of water supplies. One of the notable concepts in this regards is the concept of virtual water trade in management of water supplies. The concept of virtual water trade is defined synonymously as the sum of the needed water for production of certain quantity of a product. Accordingly, prevention from exportation of products, which may lead to exiting water from the country and emphasis on importation of water-bearing products, is considered as one of the strategies which have been taken by some countries in the management of their own restricted water supplies. This strategy means that the water supplies of countries should be employed for manufacturing of the products, which are followed by further income economically. The present article is an innovation in calculating virtual water values by 6-digit SITC codes for all sectors of the economy in the selected countries (Persian Gulf countries). For each commodity code exported and imported in countries, the amount of virtual water (cubic meters per ton) is also calculated. In this regard, the rate of hidden water in imports and exports of the aforesaid countries during 2001 to 2012 is explored. The results reveal the fact that Iran has not taken any certain defined strategy regarding the management of water supplies by means of virtual water concept. JEL Classification: Q18, Q25, O13

on one hand, Iran due to the low annual rainfall and lack of appropriate spatial and temporal distribution in precipitation is considered as an arid and semi-arid country experiencing stress and water scarcity; on the other hand, 90% of annual water consumption has been allocated to agriculture sector in Iran and efficiency and productivity of water consumption do not enjoy favorable status in this sector. While it can overcome this problem by use of virtual water criterion in trade with the countries which enjoy water status such as Turkey. In this regards, the present study has examined this issue in form of selected agriculture goods based on common indices for detection of trade opportunities. Cosine criterion indicated that the degree of similarity and complementary of Turkey’s export with Iran is greater than structural similarity of Iran’s export with Turkey. With regard to trade potential calculations, Iran and Turkey have high export capacity in trade of agriculture goods. Further, Index of Drysdale indicated that the possibility for development of trade from Turkey to Iran is greater than trade from Iran to Turkey and ultimately adjustment of Balasa index based on virtual water trade process indicated that Iran should change its import and export priorities at area of agriculture products. Further, results from research indicate that applying virtual water criterion and removing the products lacking relative advantage in trade between Iran and Turkey result in increase in export of Turkey’s agricultural products to Iran and increase in Iran’s benefit in trade of virtual water.