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India and the Economics of Water – EQ Mag Pro

India and the Economics of Water – EQ Mag Pro

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The total water demand in India is expected to rise by over 70% by 2025, a huge demand-supply gap is expected in the coming years. Three-quarters of Indian districts with around 64 crore people, are hotspots for water-related disasters.

Water is a critical part of our environment but the last century saw surface and ground water quality deteriorating due to human-related activities such as mining, livestock farming, industrial, municipal and agricultural waste disposal, soil erosion and heavy metal pollution. In countries that are water-stressed this has a huge impact. India, one of the 17 countries facing the highest levels of water stress in the world has seen unprecedented strain on water resources in recent years.

The reasons for this are many. The changing pattern of the Indian monsoon reflecting global climate change is one, but mismanagement of the water resources is another key factor. While India has one of the largest irrigation systems globally, it has high levels of inefficient water use. Agriculture in India that clocked a share of 20% of GDP in 2020-21 for the first time in 17 years is extremely inefficient in its use of water even as it uses up 80% of all water resources in the country. Depletion of the groundwater with extraction being more than recharge also contributes to the water stress.

The total water demand in India is expected to rise by over 70% by 2025, a huge demand-supply gap is expected in the coming years. Three-quarters of Indian districts with around 64 crore people, are hotspots for water-related disasters. To avoid this situation, it will be necessary to make significant investments in sustainable technologies to avoid climate induced economic losses. This will include investments in water infrastructure, an aspect that is neglected at present. If action is not taken now, the situation is likely to deteriorate further by 2050 with demand exceeding supply leading to a likely 6% loss in GDP.

The past three decades have seen a deterioration in the canal system of irrigation accompanied by an increased reliance on groundwater. Increasing private investment in the tapping of groundwater and construction of wells in cities and small towns has led to 75% of the water economy dependant on self-supply. This is leading to pollution, contamination and decay of rivers, water bodies, wetlands and groundwater resources with resulting shrinking of per capita availability of water and water resources. Action needs to be taken immediately to strengthen the water infrastructure with strong policies and regulations accompanied by robust investments. It is only then that that gap between availability and utilization, demand and supply of water resources can be bridged.

Another aspect that can help India manage its water resources is the use of sustainable technologies such as renewable energy for power. Energy is one of the basic needs of life with the need for energy increasing day by day. The consumption of fossil fuels has resulted in serious ecological problems with climate change becoming a threat to not just natural habitats but the health of all living creatures. Tackling this with energy from renewable resources rather than fossil fuels has led to a focus on renewable energy for sustainable growth.

In addition to being clean energy, solar and wind power require zero or little water use enabling India to meet its power needs without carbon emissions or consuming water. In a country with a growing population and farms and industries competing for the scarce commodity, renewable energy can help to better manage the limited water resources. Studies show that India can reduce its water consumption intensity by more than 25 percent just through meeting its renewable energy targets1.

Solar power is also capable of enabling access to clean water in areas without basic clean water. This has been successfully demonstrated in Indonesia, a country that owns considerable water resources but lacks safe fresh water in most of the remote areas. A small-scale water treatment system powered by solar thermal or PV comes at a low capital cost with the added benefits of ease of operation and low maintenance.

With WaterAid’s water quality index (WQI) ranked India at 120th among 122 countries around the world. An independent water regulatory authority must be set up that monitors water usage, treatment and recharging by industry. There is a need for more incentives at the policy level to implement and scale-up waste water treatment to save groundwater. It is hoped that the development finance institution proposed in India’s recent budget will result in a visible change with innovative structuring of financing options for strengthening the water economy!

Source : PTI

Anand Gupta Editor - EQ Int'l Media Network