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1 Store large quantity of water for irrigation and electricity generation.
2 Transfer water to different locations in adequate quantities.
3 Allow equitable distribution of water because people near the source grow water intensive crops like sugar crane and rice while people farther down stream do not get any water.
Construction of large dams causes:
1 Social problem of displacement of large number of peasants and tribals,without rehabilitation and adequate compensation.
2 Economic problem of expenditure of huge amounts of public money without the generation of proportionate benefits.
3 Environmental problems of deforestation and loss of bio diversity.
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