Water crisis leaves India's economy dry

In the sweltering afternoon heat in the town of Kalwa in the district of Thane, just north of Mumbai, residents are bearing the brunt of a water crisis.

Tejas Patil, a legal apprentice, says that in Kalwa running water is completely shut off for three days of the week, while on other days it is only available for a few hours.

“This year is the worst ever,” he says as sweat trickles down his forehead. “Industry in the Thane district seems to be getting enough water for its purposes. The residential areas are getting the most affected.”


He blames mismanagement of water resources and poor rainfall during the monsoon season in the past two years for the problem.

In Kalwa and all across the state of Maharashtra, a water crisis is wreaking havoc with people’s lives and the economy. Areas of the state, including the agricultural Latur, Beed and Aurangabad districts – where water-guzzling sugarcane is widely produced – are suffering through a severe drought. The problem is spreading to urban areas too, where the population is growing and authorities are struggling to manage the limited water resources, as industry and residents battle for supply. There have even been reports of protests in the Thane district, while there have been fights over water in places including Latur.

The drought in Maharashtra and the wider water management issues presents a huge challenge to the economy, as the agricultural sector – a major contributor to the GDP that employs the most people in the state – is hit. Along with its impact on households, this also leads to water shortages for sectors including manufacturing and results in a strain on urban economies, analysts say.

It is so bad, that on Wednesday the Bombay High Court ordered that 13 Indian Premier League cricket matches scheduled for the Maharashtra cities of Mumbai, Pune and Nagpur should be played elsewhere because of the amount of water needed to maintain the pitches.

“The water issue is a big issue, from the rural to the urban areas,” says Dennis Abraham, the managing director of Josab India, a water treatment company. “The drought of course causes the economic fall in terms of the money being pumped in to the villages, to the farmers, for their livelihood.”

He says that “more than a natural calamity, it is more of a water management issue”.

It also pushes Indians further into poverty. Drought prevents many farmers from being able to repay their loans. Farmer suicides have been widely documented in India, and the drought is one factor that drives them.

“Most Indians live in rural areas. People are coming to the urban sectors and trying to take up jobs, whatever they can,” he says. “This is another economic impact that could happen because of this drought. Farmlands will decline. Food grains will decline. People will come into the urban areas looking for work and then urbanisation increases, which cannot be handled in terms of the current infrastructure. There will be more poverty. It’s a chain. These sorts of droughts are going to bring in a big impact.”

Sanjeev Unhale is based in Aurangabad and is the secretary of Dilasa Janvikas Pratishthan, an NGO working for rural improvement.

“The situation is worsening every day. The government is not coming forward generously,” he says, explaining that many farmers were migrating to the south of the country and west of the state to find work.

Farmers have been struggling after losing their crops over the past two years because of poor rainfall. There has been a surge in the number of farmer suicides in the region, he adds.

“The situation will be more grim in the days to come,” says Mr Unhale.

He says that sugar cane production in the region is contributing to the drought.

The problem of water shortages is not only limited to Maharashtra. Parts of the southern Indian state of Andhra Pradesh, as well as Chhattisgarh in central India and Bundelkhand in the north, are also experiencing droughts. The country’s leadership at the highest level has emphasised that India needs to manage its water resources much more effectively as the country’s economy grows.

“We must recognise that India faces a huge shortage of this precious resource,” said the president Pranab Mukherjee, speaking in New Delhi this month. “While India represents 17 per cent of the world’s population, we possess only 4 per cent of its renewable water resources. Because of population expansion, increasing urbanisation and industrialisation, demands for water are stretching our resources.”

The availability of water per person in India was “decreasing by the day”, while the impact of climate change was “causing severe floods and drought with alarming frequency”, he added.

He said that measures including drip and sprinkler irrigation and a better choice of crops suited to the environment could save water in the agriculture sector.

It is not only during the summer months that Indians across the country face challenges with water. There are many households that do not have any access to running water in their homes.

“Too many communities in our country still lack basic water infrastructure. Considerable time and energy is spent by their people collecting water instead of progressing to income-generating activities,” Mr Mukherjee said. “Proper water infrastructure would rejuvenate these populations. In fact, locally feasible technologies and marketable innovations should urgently be introduced in such locations. Involving micro-financing institutions would also help to popularise these technologies.”

India is pushing to become a leading global manufacturing hub as part of one of the prime minister Narendra Modi’s main industrial projects, Make in India.

But the water crisis is taking a toll on industry in Maharashtra. There have been cuts to water supplies to manufacturers in areas including Aurangabad. Some companies have said that this would negatively impact revenue generation for the state and could lead to job losses, the Indian business newspaper Mint reported.

“Faced with a drought situation the government needs to make judicious use of available water,” Girish Mahajan, the state’s minister for water resources, told Mint, adding that industry associations had complained to him that the cuts could affect manufacturing. “Industry associations have pointed this out, but the situation is critical for all people. Industry is important, but people and cattle in the affected regions are more important. Industry will have to bear with the water cuts.”

Mr Abraham says that India need to look at solutions including rain water harvesting. But there also needs to be changes made by the government to help to manage the problem.

“Policy is stuck in 1942 and 1947, and with a lack of accountability in the government, they do not care,” he says. “Only when that change happens, then we would see a change in ground-level agriculture, water, economic growth. The legislative assemblies need to have a different thought process.”

For one tiny restaurant in Kalwa, changes cannot come soon enough. Dimpy’s fast food restaurant is not air-conditioned and the heat coming through the open entrance combines with the heat from the kitchen to create an oppressive environment. Shekar Shetty, a waiter, explains that they have stopped providing tap water to customers because of the water cuts and that they rely on a 2,000 litre storage tank to get through the three-day water bans.

“We have to be careful to save water,” he says.

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