Malaprabha river basin has been the study area for the development of comprehensive database on the status of water sector and the development of integrated hydro economic model for selected water services. Malaprabha river is a tributary river to the Krishna river and flows through the state of Karnataka in India. For studying the feasibility of Payment for Watershed Services (PWS) to improve the water availability, in this study a detailed analysis of the historic hydrologic was carried out and a framework of hydrologic and water allocation model is developed. A detailed database of the catchment is developed for hydrological analysis and modelling. Terrain characteristics, land use and land cover, soil characteristics, crop characteristics and yield, hydro-meteorological data, stream flow and reservoir water level information were collected from various sources and assimilated in the database.