Abstract
The planning and management of water resources in the Shiyang River basin, China require a tool for assessing the impact of groundwater and stream use on water supply reliabilities and improving many environment‐related problems such as soil desertification induced by recent water‐related human activities. A coupled model, integrating rule‐based lumped surface water model and distributed three‐dimensional groundwater flow model, has been established to investigate surface water and groundwater management scenarios that may be designed to restore the deteriorated ecological environment of the downstream portion of the Shiyang River basin. More than 66% of the water level among 24 observation wells have simulation error less than 1·0 m. The overall trend of the temporal changes of simulated and observed surface runoff at the Caiqi gauging station remains almost the same. The calibration was considered satisfactory. Initial frameworks for water allocation, including agricultural water‐saving projects, water diversion within the basin and inter‐basin water transfer, reducing agricultural irrigation area and surface water use instead of groundwater exploitation at the downstream were figured out that would provide a rational use of water resources throughout the whole basin. Sixteen scenarios were modelled to find out the most appropriate management strategies. The results showed that in the two selected management options, the groundwater budget at the Minqin basin was about 1·4 × 10^8^ m^3^/a and the ecological environment would be improved significantly, but the deficit existed at the Wuwei basin and the number was about 0·8 × 10^8^ m^3^/a. Water demand for domestic, industry and urban green area would be met in the next 30 years, but the water shortage for meeting the demand of agricultural water use in the Shiyang River basin was about 2·2 × 10^8^ m^3^/a. It is suggested that more inter‐basin water transfer should be required to obtain sustainable water resource use in the Shiyang River basin. Copyright © 2009 John Wiley & Sons, Ltd.