What a new water policy should look at

M Dinesh Kumar/A Narayanamoorthy | Updated on January 15, 2020 Published on January 15, 2020

Free flowing There are no set rulesfor water allocation in the Nation Water Policy   -  The Hindu

Mere use of economic principles does not address concerns over inter-sectoral water allocation and water for the environment

The recent move of the government to come up with a new water policy has surprised many. India will probably be the only country which has produced three versions of its National Water Policy (NWP) in a span of 25 years. The first one was in 1987,the second in 2002 and the third in 2012.

Is there a real need for a new water policy, that too when the State governments have, so far, not seriously looked at any of the pointers contained in the earlier NWPs while framing their State water policies and programmes?

However, now that we decided to have a new NWP, the expertise available with the committee concerned must be adequate for a comprehensive look at India’s water sector.

Further, we need to make sure that none of the members of the group are antagonistic to the landmark decisions India had taken during the past 70-plus years to become a water-secure nation. Some believe that India can do away with surface water projects involving large dams, and the country only needs to manage its groundwater to become food- and water-secure.

The committee will do justice to the task in hand if it decides to look at what has really gone wrong with the earlier policies, particularly the lack of willingness on the part of the States to accept the ideas listed in them. The challenge is to identify the areas where ambiguities, inconsistencies and lack of conceptual clarity exist, and also tighten the NWP-2012 to make it meaningful.

The NWP-2012 document lists the basic principles that should govern the framing of public policies on water. One is that the planning, development and management of water resources should be based on an integrated perspective, considering the local, regional, State and national contexts. The other is on equity and social justice.

But the States do not follow these principles. One example of this is the policy regarding promotion of decentralised water harvesting. Such schemes do not take cognisance of the interests of downstream parties and regional players. Also, the policies followed for pricing of irrigation water and electricity for groundwater pumping largely benefit rich land-owners, who walk away with a major chunk of the subsidy benefits.

Lack of conceptual precision

According to the NWP 2012, economic principles need to guide the pricing of water. But no State is willing to charge for irrigation water on the basis of either the cost of supplying or the marginal returns from crop production, whichever is smaller. This is also applicable to pricing of electricity for pumping water.

Further, the mere use of economic principles does not address the issue of inter-sectoral water allocation, and this would mean compromising on equity and social justice, water for environmental use etc. Economic principles suggest that net marginal returns from the use of water should be a basis for its price when it is used for “production”, if supply is to be affordable.

Since the marginal returns from water in manufacturing are much higher than that of crop production, the former can afford much higher prices than irrigators. Since the cost of production and the price of water are very high in water-scarce basins, if we blindly follow this “affordability” criterion without rules and mechanisms for water allocation, industries might be able to walk away with all the water in such basins. The NWP 2012 is silent on this important aspect of policy-framing.

This problem can be addressed only through clearly spelling out water allocation priorities in the policy document. Subsequently, actual allocation in different basins will have to be decided on the basis of the overall availability and the competing demands, using the policy goals. Pricing can then be formed to encourage efficient use.

Also, the criteria for the pricing of water for domestic uses, which are ‘non-economic’, need to be spelt out. If we go by “long-term marginal cost” pricing, the resource cost and environmental degradation will have to be considered along with the cost of production and supply of water. In that case, how do we ensure that the poor get adequate access?

There is a need to differentiate between the price of water (the ‘resource’) and charges for water-related services. While the first should consider the cost of resource depletion, the second should consider the cost of production and supply.

The policy talks about following economic principles in the allocation and pricing of the water that is available after meeting drinking, food security and livelihood needs. But how do we decide whether a particular use is for subsistence? In reality, no water will be left for allocation in water-scarce basins, after diversion for domestic use and food production.

The NWP 2012 talks about community-based management of aquifers. But we might require higher-level institutions that are legitimate and that recognise the community’s rights over water. The policy document doesn’t delve into this complex and vexed issue. That said, how will the community allocate water rights amongst the users? The committee should look into these earnestly.

No institutional mechanisms

The NWP 2012 is unclear about the mechanisms for achieving drinking-water security, equity in access to water, water-demand management etc. For instance, if we depend on the groundwater for drinking-water supplies, we are unlikely to achieve drinking-water security, because of the severe pressure on the resource from irrigators. Similarly, how do we restrict water use by different sectors for demand management, as improving water use efficiency alone will not be sufficient?

The NWP 2012 talks about using economic incentives and penalties to reduce pollution and wastage. Currently, there is no agency which monitors water use in any of the sectors. Which agency is to offer this incentives and disincentives? In the absence of such agencies, the policy prescriptions remain as a mere ‘wish list’.

Lastly, the drafting committee should keep in mind the fact that water is largely a State subject, and every Indian State has a unique water situation. Many States do not face a physical scarcity of water, but rather experience floods. There are regions where the availability of arable land for expanding crop cultivation is a problem; water scarcity might be a constraint for large regions. The current and projected future demand patterns, the physical environment, socio-economic features and a host of other factors vary from State to State. Given this scenario, a National Water Policy should avoid being prescriptive.

Kumar is Executive Director, Institute for Resource Analysis and Policy, Hyderabad and Narayanamoorthy is Senior Professor, Department of Economics and Rural Development, Alagappa University. Views are personal

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Published on January 15, 2020
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