Abstract
Integrated functional approach to water governance in a federal state structure can avoid vertical and horizontal conflicts. There are queries on how functional approach to water governance can be promoted in the context of federal state structure. Other concerns include linkages, the meditating factor demanding for reconciling competing water uses, integrated water resources management (IWRM) and integrated river basin management (IRBM). This article assesses the existing governance framework and its suitability to promote functional approach to water governance, reconciliations and policy options. There are inconsistencies in the Constitution, Federal water management laws, river basin high councils and authority’s laws, policies, strategies and the regulation that establishes and defines the powers and duties of the Ethiopian Basin Development Authority. Moreover, there are missing links and integrations, centralizing tendencies and failures to accommodate and harmonize pluralistic and diversified local practices. The water laws need to integrate both the bottom-up approach (by empowering the grassroots and bringing efficient, equitable, and sustainable use of water) and top-down form of governance (to harmonize the inter-local linkages among and within regional states). The inter-state basin governance needs reform and the over-centralized role of the government to designate water institutions should be controlled. Reconciliation is mandatory for better empowerment, cooperation and harmonization at all linkages, levels and types of inter-governmental relations. 
 Key terms:
 Federalism, IWRM-IRBM, Functional approach, Water governance linkages, Reconciliation, Harmonization
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