It also suggests developing plans to move water from area to area via water basin transfer to help augment the resources of water scarce regions.
Scarcity of water resources could overtake the impact of carbon emissions on climate change as the prime concern of governments and world populations in the next decade, the report indicated.
"If present trends continue, 1.8bn people will be living in countries or regions with absolute water scarcity by 2025, and two thirds of the world population could be subject to water stress," says the report.
Five of the world's regions including Africa, Asia and the Pacific, Europe, North America and West Asia highlighted freshwater stresses as a particular pressure in research for the report.
"Irrigation already takes about 70% of available water. Of the world's major rivers, 10% fail to reach the sea for part of each year because of irrigation demands. Yet meeting the Millennium Development Goal on hunger will mean doubling food production by 2050," says the report.
By 2025 water use is predicted to rise by 50% in developing countries and by 18% in the developed world.