The increasing scarcity of water and the occurrence of drought in the dry environments is now a serious problem threatening the social and economical development. High rate of population growth and development, require continuous diversion of agricultural water to higher priority sectors. The need to produce more food with less water poses enormous challenges to transfer existing supplies, encourage more efficient use and promote natural resources conservation. On-farm water-use efficient techniques if coupled with improved irrigation management options, better crop selection and appropriate cultural practices, genetic make-up, and timely socio-economic interventions would help achieving this objective. In water-scarce areas, water is more limiting to production than land. Maximizing water productivity should have higher priority over maximizing yield in the strategies of water management. Conventional guidelines for determining crop irrigation requirements, which are designed to maximize yield, need to be revised for achieving maximum water productivity. In a fast changing world towards free trade and open markets, future trends in water and land use in agriculture are difficult to predict.