Answer:

India, with 18% of the world’s population but only 4% of its water resources, is facing a severe water management crisis. As per NITI Aayog, India’s water demand is projected to be double the available supply by 2030, signalling an impending water scarcity crisis. This highlights the urgent need to reform water pricing policies for sustainable and equitable use across sectors.

Current Water Pricing Policies in India

• Subsidised Agricultural Water: Agricultural water in India is highly subsidised, leading to excessive water consumption and unsustainable groundwater extraction.
  For instance: States like Punjab and Haryana offer free or nearly free electricity for pumping water, causing over-extraction of groundwater and long-term depletion.
• Flat-Rate Urban Tariffs: Flat-rate water tariffs in many urban areas discourage conservation by not linking pricing to actual water usage, resulting in excessive consumption and wastage.
  For example: Delhi provides 20 kiloliters of free water per month to residential users, which reduces the incentive to conserve water, despite the city’s rising water demand.
• State-Level Pricing Models: States in India follow varied pricing systems, leading to disparities in water management and efficiency across regions.
  For example: Maharashtra implements a volumetric pricing system for irrigation, while Tamil Nadu uses a flat-rate system, causing unequal and inefficient water resource management.
• Subsidised Industrial Water Use: Industries, particularly those in Special Economic Zones often benefit from subsidised water rates, encouraging inefficient and excessive water usage.
  For example: SEZs in Gujarat provide water at subsidised rates to industries, contributing to industrial water wastage and less focus on recycling.
• National Water Policy (2012): The National Water Policy emphasises rational water pricing and treating water as an economic good to ensure efficient use.

Shortcomings of Current Water Pricing Policies in India

• Lack of Cost Recovery: Water utilities struggle to recover operational costs due to heavy subsidies, leading to poor infrastructure maintenance and service quality.
  For example: Water utilities in Punjab and Rajasthan face chronic financial deficits, resulting in underinvestment in infrastructure and frequent water supply interruptions.
• Over-Extraction of Groundwater: The absence of groundwater regulation encourages unchecked extraction, leading to aquifer depletion and long-term resource scarcity.
  For example: In Punjab, where groundwater is heavily relied upon for irrigation, the water table is declining by 1 metre per year due to over-extraction.
• Urban Water Wastage: Flat-rate water tariffs and insufficient metering result in urban households consuming more water than necessary, with little incentive for conservation.
  For example: Cities like Bangalore and Delhi experience high non-revenue water losses, with households wasting significant amounts of water due to inefficient pricing systems.
• Underinvestment in Water Infrastructure: Low water tariffs prevent sufficient investment in essential infrastructure like pipelines and treatment plants, leading to periodic crises.
  For example: Chennai’s 2019 water crisis was exacerbated by underinvestment in water infrastructure, causing severe shortages across the city.
• Limited Focus on Industrial Efficiency: Water pricing policies fail to push industries to adopt water-efficient practices or reuse water, leading to excessive consumption and pollution.
  For example: The textile and chemical sectors in India consume large amounts of water without being incentivized to recycle or reduce their water usage.

Reforms and International Best Practices

• Tiered Pricing Systems: Implementing tiered water pricing ensures that higher consumption is penalised with higher tariffs, promoting water conservation and sustainable use across sectors.
  For example: Israel and Australia use tiered pricing, encouraging households and industries to reduce excessive water consumption.
• Water Metering: Universal water metering provides accurate measurement of water usage, leading to fair billing and greater accountability.
  For example: Singapore has successfully implemented universal metering, which has contributed to reduced water wastage and better conservation incentives.
• Agricultural Water Management: Efficient irrigation techniques like drip irrigation reduce water wastage in agriculture, which is a major water-consuming sector.
  For example: Israel has adopted drip irrigation extensively, leading to increased agricultural efficiency and reduced water usage.
• Decentralised Regulation: Localised water management empowers regional agencies to set appropriate pricing and manage resources based on local conditions.
  For example: Australia’s Murray-Darling Basin model decentralises water regulation, ensuring that water prices and policies suit local needs and conditions.
• Polluter Pays Principle: Enforcing the polluter pays principle makes industries accountable for their environmental impact, encouraging them to adopt cleaner technologies.
  For example: The European Union applies this principle to regulate industrial water pollution, ensuring that industries take responsibility for their environmental footprint.

To ensure sustainable water use, India must adopt a holistic approach to water pricing that emphasises equity, efficiency, and conservation. As Mahatma Gandhi said, “Earth provides enough to satisfy every man’s need, but not every man’s greed.” Reforming water pricing is essential to safeguarding India’s water future and achieving water security for all sectors.

DOWNLOAD PDF