Price of water is not about economics, but justice, Pg8

Key Highlights:

• Moody's June ratings placed India in the highest water-risk category, citing fragmented governance and excessive groundwater depletion.
• India, with 18% of the world's population, has access to only about 4% of global freshwater resources.
• The Ministry of Jal Shakti announced in 2024 that India's per capita freshwater availability is shrinking over the decades.
• Urban water demand, driven by population growth and commercial expansion, consistently outpaces supply.
• The low price of water in Indian cities is disconnected from the true cost of supply, hindering effective water management.

Detailed Insights:

• Water tariffs in Indian cities are often set based on political considerations rather than the actual costs of abstraction, treatment, storage, and distribution.
• Many Urban Local Bodies (ULBs) do not undertake full-cost accounting for their water operations, obscuring embedded subsidies.
• Non-Revenue Water (NRW), lost to leakage or theft, routinely exceeds 30% of total supply in many cities, representing significant financial and resource waste.
• Consumers are willing to pay more for assured quality drinking water, challenging the argument against raising tariffs.
• The cycle of low tariffs and poor service quality leads citizens to pay twice: through tariffs and for domestic water purifiers.
• Lower economic classes are disproportionately affected, either consuming unsafe tap water or spending a larger share of their income on water.
• Higher-income households tend to consume substantially more water, highlighting an inequitable distribution of resources.
• Urban India converts nearly 80% of its daily water into sewage, indicating a lack of efficient reuse mechanisms.
• A rational water economy would treat greywater as an asset, collecting and treating it for non-potable uses to reduce freshwater demand and sewage discharge.
• Equity goals must underpin tariff structures, ensuring subsidized lifeline quantities for all while progressive pricing discourages excessive consumption.

Key Concepts Involved:

• Non-Revenue Water (NRW): Treated water that is lost before reaching consumers due to leaks, theft, or metering inaccuracies.
• Greywater: Wastewater from domestic activities like washing and bathing, excluding toilet waste, which can be treated for non-potable uses.
• Full-Cost Accounting: An accounting method that considers all direct and indirect costs of water supply, including environmental and social impacts.
• Circular Urban Water Economy: A system that minimizes water waste by maximizing reuse and recycling of water resources within urban areas.