CrazyZ
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India is in the midst of the most severe water crisis in its history, in which 600 million people have to contend with extreme water shortages. Nearly 200,000 people die annually because they cannot obtain clean water. Storage in 26 dams in the state of Maharashtra has dropped to zero, and five other states are on the verge of drought. This already grim situation is set to get worse, because 21 major cities could run out of groundwater by next year.
In all of this, the poor are getting the rawest deal possible. In the slums of Delhi, instance, the government sends tankers once every 10 days, and each household gets only 600 litres of water. Even with a conservative estimate of four people per household, it works out to 15 litres per person per day. Nor is this water very clean, since it is used again and again to make every drop count, increasing the risk of diseases. It’s worse in some rural areas, with entire populations migrating in search of water.
The wealthy, meanwhile, get the
best deal
. High-income households in Delhi consume anywhere from 250 to 600 litres of water per person daily. The same disparity is true in other major cities such as Mumbai, where the slum dwellers must struggle for water while government provides 100 to 300 litres of it daily to wealthy individuals. Unlike their poor counterparts, the wealthy are under no pressure to conserve water.
Firstly, they pay no price for wasting it. Unlike electricity or gas bills, water bills are not served on a household basis, but are typically served for entire buildings or housing societies, with costs to be shared equally by all residents. If one household uses too much water, a hundred others pay for their mistake. It is a classic tragedy of the commons.
Next, the official rate charged by government is very low, leading to higher demand. For example, in Mumbai buildings and societies pay 5 rupees (US$0.07) per 1,000 litres. The less fortunate, however, must supplement their meagre government rations with water bought from grey markets or informal operators known as “water tanker mafias”. These mafias charge twice or thrice the official rates, and usually steal water from lakes or farm wells, or siphon it from the main pipelines.
Under the current system, it is in almost nobody’s interests to conserve water. The wealthy pass on their already subsidised water bills to their neighbours, as we saw earlier. Government officials, meanwhile, are loathe to raise charges because that is a sure way to lose votes.
Nor do officials feel the need to ensure efficient water supply. Mumbai loses 25 per cent of its water to leakage and theft. Similarly, 37 per cent of the water leaks out of Bangalore’s pipelines. Politicians and bureaucrats receive water in their own homes, and receive their salaries regardless of how poorly they perform their duties. Not surprisingly, they see no need to improve.
On the supply side, private companies would fix leaks promptly. For them, it’s not just 37 per cent water leaking away, it is 37 per cent more money to be made.
Under a privatised system, it would also make sense to maintain and even create new water bodies such as lakes. Bangalore, for example, once had 1,960 lakes, most of which have been destroyed by real estate development or industrial pollution. If water’s economic value can be captured, however, it would be profitable to preserve them. This increase in supply will lead to a reduction in price.
The biggest beneficiaries of a vibrant and competitive water market will be the poor. They will no longer have to walk for miles to fetch water. The water will come to them, and will be both cleaner and available whenever they need it. The competition will also mean that water mafias cannot charge a premium for water of dubious quality, as they do currently.
The way forward for government policy is to set up a suitable legal framework to allow private ownership of water bodies such as lakes, rivers, groundwater aquifers, etc, which would enable the rise of a competitive water market.
A very sensible and cost-effective measure would be to privatise the water supply. This would align everyone’s incentives with the desired goal of conserving water. Not beholden to any electorate, private suppliers would set prices based on supply and demand, and those prices would certainly be higher than current rates.
At higher rates, people will also be unwilling to pay for a neighbour’s irresponsible waste of water, so meters would be installed separately for each house, as is done for electricity. To save on their own water bills, people will be more judicious when using water.
https://www.scmp.com/comment/opinio...er-shortage-and-corruption-surrounding-it-can
In all of this, the poor are getting the rawest deal possible. In the slums of Delhi, instance, the government sends tankers once every 10 days, and each household gets only 600 litres of water. Even with a conservative estimate of four people per household, it works out to 15 litres per person per day. Nor is this water very clean, since it is used again and again to make every drop count, increasing the risk of diseases. It’s worse in some rural areas, with entire populations migrating in search of water.
The wealthy, meanwhile, get the
best deal
. High-income households in Delhi consume anywhere from 250 to 600 litres of water per person daily. The same disparity is true in other major cities such as Mumbai, where the slum dwellers must struggle for water while government provides 100 to 300 litres of it daily to wealthy individuals. Unlike their poor counterparts, the wealthy are under no pressure to conserve water.
Firstly, they pay no price for wasting it. Unlike electricity or gas bills, water bills are not served on a household basis, but are typically served for entire buildings or housing societies, with costs to be shared equally by all residents. If one household uses too much water, a hundred others pay for their mistake. It is a classic tragedy of the commons.
Next, the official rate charged by government is very low, leading to higher demand. For example, in Mumbai buildings and societies pay 5 rupees (US$0.07) per 1,000 litres. The less fortunate, however, must supplement their meagre government rations with water bought from grey markets or informal operators known as “water tanker mafias”. These mafias charge twice or thrice the official rates, and usually steal water from lakes or farm wells, or siphon it from the main pipelines.
Under the current system, it is in almost nobody’s interests to conserve water. The wealthy pass on their already subsidised water bills to their neighbours, as we saw earlier. Government officials, meanwhile, are loathe to raise charges because that is a sure way to lose votes.
Nor do officials feel the need to ensure efficient water supply. Mumbai loses 25 per cent of its water to leakage and theft. Similarly, 37 per cent of the water leaks out of Bangalore’s pipelines. Politicians and bureaucrats receive water in their own homes, and receive their salaries regardless of how poorly they perform their duties. Not surprisingly, they see no need to improve.
On the supply side, private companies would fix leaks promptly. For them, it’s not just 37 per cent water leaking away, it is 37 per cent more money to be made.
Under a privatised system, it would also make sense to maintain and even create new water bodies such as lakes. Bangalore, for example, once had 1,960 lakes, most of which have been destroyed by real estate development or industrial pollution. If water’s economic value can be captured, however, it would be profitable to preserve them. This increase in supply will lead to a reduction in price.
The biggest beneficiaries of a vibrant and competitive water market will be the poor. They will no longer have to walk for miles to fetch water. The water will come to them, and will be both cleaner and available whenever they need it. The competition will also mean that water mafias cannot charge a premium for water of dubious quality, as they do currently.
The way forward for government policy is to set up a suitable legal framework to allow private ownership of water bodies such as lakes, rivers, groundwater aquifers, etc, which would enable the rise of a competitive water market.
A very sensible and cost-effective measure would be to privatise the water supply. This would align everyone’s incentives with the desired goal of conserving water. Not beholden to any electorate, private suppliers would set prices based on supply and demand, and those prices would certainly be higher than current rates.
At higher rates, people will also be unwilling to pay for a neighbour’s irresponsible waste of water, so meters would be installed separately for each house, as is done for electricity. To save on their own water bills, people will be more judicious when using water.
https://www.scmp.com/comment/opinio...er-shortage-and-corruption-surrounding-it-can
