This chapter discusses the inter-sectoral allocation of Hirakud reservoir water. It also discusses the supply situation of the water from the reservoir. The chapter analyzes the different uses of the reservoir water. It focuses on the Government of Orissa's recent water policy and its impact on Hirakud dam water management. The chapter explores the issues relating to inter-sector water allocation. It describes the issues of efficiency and equity in the irrigation system. The chapter deals with the ecology and environmental issues are discussed. It examines the ways of conflict resolution. Easy availability of raw materials in the locality, and supply of cheap energy and dam water by the government has encouraged the establishment and operation of industries in the area. However, unequal property rights of access to and use of this scarce resource has provoked a number of conflicts among its users.