The paper provides results of a study aimed at saving a substantial amount of water by maintaining deeper groundwater levels to prevent fallow evaporation and by reducing the cost of groundwater abstraction for lowland farmers. An integrated LIS economic appraisal model was developed that linked simulated response of hydrological modelling of different conjunctive management options with economic analysis. The simulation results of the LIS system dynamic model show that a combination of canal lining and pumping groundwater is the most cost-effective way to reduce non-beneficial evapotranspiration and increase water availability by saving up to 68 MCM of water. The simulation results of economic parameters indicated that canal lining and pumping also offer highest net economic benefits (¥21.98 million). Among other options, canal lining also indicates reasonably high net economic benefits (¥9.02 million). The model indicates a small increase in marginal value of water with canal lining (¥1.53m3) and pumping and canal lining (¥1.62m 3). Among other options, the marginal capital cost of water saving for pumping and canal lining together was the lowest (¥0.096m 3). However, the marginal capital cost of water saving for pumping and shifting canal water downstream was the most expensive (¥1.046m 3).