Kutch, a semi-arid district in the state of Gujarat in western India, is known for its water scarcity. Its panacea is made out to be the Sardar Sarovar Project (SSP), a controversial dam under construction on the Narmada River in western India. The paper analyses the social, caste and power dynamics in a village supposed to benefit from the project and shows how these are intrinsically tied to the water question. The analysis of the arrangements governing land and water use indicates that access to and control over water resources was always differentiated and this differentiation is likely to increase with the advent of canal irrigation. The paper argues that notions of the “user” and “community” need to be de-homogenised to accommodate variations arising due to historical legacies, class, caste, gender and occupation. The paper argues that both macro and micro-level water interventions are often blind to questions concerning social difference. Thus water schemes build on or reinforce already skewed social and power relations. It contends that unless social difference is taken seriously, even ecologically sustainable options such as watershed development may end up being “old wine in new bottles”. In order for issues such as equity and social justice to be addressed in water interventions, the paper argues for the need on the part of implementing agencies to be aggressively partisan in targeting the marginalised and socially excluded groups.