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Managing freshwater and its allocation is challenging due to socio-economic dynamics, climate change, increased climate variability, and population increase, which drive water scarcity in many regions. Conflicts among water users (water agents), including states, frequently present challenges to the sustainable management of regional water resources, underscoring the need to develop collaborative and self-enforcing solutions that can promote fair water distribution. This study uses a combination of the Water Evaluation and Planning (WEAP) model and the Nash bargaining solution to develop an integrated water resource allocation system. This system analyses future water trends, anticipates water demands, and addresses supply-demand gaps under various scenarios to ensure the fair and equitable allocation of water resources. The study illustrates the modelling and water allocation process through an application of the developed system in the Indus River Basin. This basin has high water demands for agricultural, domestic, industrial, and environmental purposes. The analysis and implementation of various scenarios in WEAP and water allocation using the Nash bargaining solution provide a mechanism by which to (1) evaluate/incorporate the complex feedback between water demand and supply in water allocation decisions; (2) compare the effects of different scenarios on water-use strategies; and (3) ensure equitable and fair allocation of water resources among the agents (stakeholders). Applying a combination of WEAP model and Nash bargaining solution approaches can provide an integrated decision-support framework for the sustainable management of water in a basin.
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