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Sediment export and retention are important ecosystem processes in any landscape causing soil erosion and sediment loading in waterways consequently affecting the health of aquatic habitats downstream. The present study quantifies sediment export and retention in four watersheds, viz., Hivra, Satrapur, Konta, and Jagdalpur in the Godavari River Basin, India, using Integrated Valuation of Ecosystem Services and Trade-offs (InVEST) ecosystem service modelling tool. The  results revealed that the sediment export yields ranged from 0.75 (Hivra) to 2.77 t/ha/year (Jagdalpur). The mean deviation between modelled values and observed sediment export yield was - 11.11%, which indicated good prediction by the model. The sediment retention ranged from 16.04 (Hivra) to 101.52 t/ha/year (Konta). Most sediment export and retention occurred on cropland or shrubland land use land cover types in all four watersheds. For decision making on soil conservation, soil loss tolerance limits have been established for these watersheds. For aquatic habitats, sediment concentration is considered more important than the total annual sediment export, since water turbidity is an important determinant of water quality, and the aquatic lives therein. Therefore, the temporal distribution of rainfall and corresponding sediment export becomes important, since these two factors determine the sediment concentration as well as turbidity in the waterbody. In current study, "Precipitation Concentration Index adjusted Sediment Export Yield Index" was developed to account for the effects of the temporal rainfall distribution and its impact on sediment export. The index for four watersheds was quantified (Hivra > Satrapur > Konta > Jagdalpur), which is concordant to the turbidity values reported by respective gauge stations. Thus, the proposed index can efficiently capture the impact of temporal rainfall distribution on sediment export, and consequently its effect on water turbidity. The study revealed the potential of InVEST model to quantify the sediment export and retention in the watersheds studied. Together with the proposed index, it would help the policy makers in making informed decisions for planning conservation strategies for aquatic biodiversity., (© 2022. The Author(s), under exclusive licence to Springer-Verlag GmbH Germany, part of Springer Nature.)