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Scenario planning for water resource management in semi arid zone is performed using systems Input-Output approach of time domain analysis. This approach derived the future weights of input variables of the hydrological system from their precedent weights. Input variables considered here are precipitation, evaporation, population and crop irrigation. Ingles & De Souza's method and Thornthwaite model have been used to estimate runoff and evaporation respectively. Difference between precipitation inflow and the sum of runoff and evaporation has been approximated as groundwater recharge. Population and crop irrigation derived the total water demand. Compensation of total water demand by groundwater recharge has been analyzed. Further compensation has been evaluated by proposing efficient methods of water conservation. The best measure to be adopted for water conservation is suggested based on the cost benefit analysis. A case study for nine villages in Chirawa region of district Jhunjhunu, Rajasthan (India) validates the model.