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In Afghanistan, where 80% of the population is rural, irrigated agriculture using surface water is an extremely important economic activity. With the advent of the New Water Law, highly localized and centuries-old agricultural water management traditions are giving way to more modern centralized institutions. The newly-created river basin councils need management tools to support decision-making at the watershed level. This study develops the Afghan Canal Irrigation Management and Policy Tool (ACIMAP), a versatile linear programming-based model that can be used to optimize crop selection and water allocation within Afghan irrigation districts. The model can further be used in the assessment of the benefits from various irrigation infrastructure improvements. This study describes the development of ACIMAP and applies it to an illustrative case study on the Balkhab River in Balkh Province, Afghanistan. The benefits to the district’s farmers of constructing a reservoir of various capacities are analyzed and compared with the benefits derived from increasing conveyance efficiencies in the canal networks and the assignment of water rights. It is found that while the construction of a reservoir could increase agricultural net revenues by up to 30%, even greater benefits may result from increasing distribution efficiencies. Further, property rights schemes may be implemented to distribute wealth more evenly through various canal sub-regions at minimal cost to the agricultural community as a whole. These results demonstrate the usefulness of ACIMAP in assessing alternative irrigation policies.