Integrated water resource management in an emerging ‘green economy’ – few concerns

7/29/2019 Integrated water resource management in an emerging green economy few concerns

1/5

Integrated water resource management in an emerging green economy few concerns

Dipankar Dey1---------------------------------------------------------------------------------------------------------------------Water scarcity has emerged as one of the major economic and environmental issues of this century. The

Earth Summit (Rio +20) Document The Future We Want (June 2012) has advised each participantcountry to consider the implementation of green economy policies in the context of sustainabledevelopment and poverty eradication. The UN-Water Status Report on the Application of IntegratedApproaches to the Development, Management and Use of Water Resources which was launched, duringthe Earth Summit, on 19 June, 2012 has also highlighted the fact that an Integrated approaches to water

resources management and development are critical for progress towards a green economy. The concept

of virtual water trade is gaining importance. It has been claimed that one solution to water

scarcity involves accounting for the virtual water when designing trade policy.In future, in thename of protecting water resources, developed food importing nations might ask for water

labels to guarantee that only pure water (and preferably from renewable sources) be used in

the production of exported food items. By discouraging/prohibiting the use of arsenic and lead

contaminated underground water in cultivation and animal husbandry, water labels will ensurethe safety of the exported food.In such a scenario, which is very likely, the organic farmers will

increasingly rely on renewable natural water sources for cultivation. Funds will be diverted to

develop water bodies to serve that purpose. A part of these organic foods will be sold, to theaffluent domestic consumers, through organized retail chains. And for the remaining hungry

millions, GM grains will be cultivated with arsenic contaminated ground water.

---------------------------------------------------------------------------------------------------------------------

The Earth Summit (Rio +20) Document The Future We Want (June 2012) has advised eachparticipant country to consider the implementation of green economy policies in the context ofsustainable development and poverty eradication. The UN-Water Status Report on theApplication of Integrated Approaches to the Development, Management and Use of WaterResources which was launched, during the Earth Summit, on 19 June, 2012 has also highlightedthe fact that an Integrated approaches to water resources management and development arecritical for progress towards a green economy.

iAgain in October 2012, OECD has released a

report titled The Framework for Financing Water Resources Management. The report providedgovernments with a framework to assess and strengthen the financial dimension of waterresources management. It also proposed a set of principles to frame financing strategies for watermanagement, with a specific focus on the potential role of economic instruments. ii

The Water Economy

Water scarcity has emerged as one of the major economic and environmental issues of thiscentury. In 2008 the Stockholm International Water Institute has calculated that 1.4 billionpeople lived in "closed basins" where existing water could not meet the agricultural, industrial,municipal, and environmental needs of all. The water and energy intensive agriculture practices,followed worldwide since 1950s, have already made serious damage to the ecology through

1 Dipankar Dey, PhD, Dean, IBS Business School, Kolkata,[email protected],[email protected];Tel: 919433887819, the views are personal.
mailto:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]


2/5

indiscriminate use of chemical fertilizer and underground water. Thus both air and water gotcontaminated.

It is apprehended that agriculture will be adversely affected in the near future due to rise inglobal temperature. To address this challenge, an agro-biotechnology based new greenrevolution has been recommended by the global think tanks and transnational corporationsassociated with agri-business. It is argued that plants with some degree of drought tolerance willbe important for developing countries as drought is projected to be the most prevalent constraintto increased crop productivity. Mass applications of biotechnology and bio-informatics have

been projected as the appropriate drivers of this 2ndgreen revolution.iii

The looming water scarcity, direct fallout of the 1st green revolution, has not only paved the wayfor the introduction of genetically modified (GM) seeds, it has also created a vast market of itsown.

Till now, water market has remained confined to industrial and personal consumption sector

only. As in the case of other industries, water industry is now dominated by few transnationalcorporations, namely Thames-RWE, GE Water, International Water Holdings BV, SiemensWater Technologies, Black and Veatch, Veolia Environment, Suez Lyonnais. The list of majorTNCs engaged in water utility services reveals, among others, (a) the strong presence ofEuropean firms in the industry; and (b) simultaneous involvement of these firms in energyutility services also. Companies like GE, Siemens, RWE and Bechtel, known worldwide asutilities engaged in energy sector, have successfully diversified into water utility service.

As early as 2002, the European Union (EU) had opened the discussion on foreign participation inwater distribution in developing countries.iv Then in 2005, during negotiations on GATS (TheGeneral Agreement in Trade in Services), under the WTO Doha Development Round, they

proposed that in exchange for access to the water markets, developing and least developedcountries (LDCs) would receive long sought-after access to the western markets. In plain term itmeans, developing countries would get market access of their agricultural products in the EU onthe condition that they (developing countries) open their water sector to the water TNCs. In2005, 95% of the worlds privately run water utility service was controlled by European

companies. v

Saving Water for Future

European Union (EU) and other developed nations have taken a conscious decision to save theirscarce water resources by shifting the burden of cultivation to developing countries. European

Union will emerge as one of the largest importers of food grain as EU has offered to eliminateexport subsidies altogether by 2013. The EU is already the biggest market for Third World

foodstuffs.viThrough this strategy major economies of Europe (also USA) have successfullybrought down their present water usage, as the table 1 indicates, for the benefit of their futuregenerations.


3/5

India, however, has followed a suicidal policy of exhausting, this vital natural resource. Expertsare now suggesting accelerating the withdrawal process further. Even Chinathe most populouscountry has saved over 80% of its total renewable water resources for future use.

Table: Fresh Water Withdrawn as % of the Total Renewable Water Resources

Country 1878-97 2003-07 2008-12*

India 39.7 - 40.1

China 18.7 19.5 -

The Netherlands 71.0 12.6 11.7

USA 18.2 15.6 -

Germany 43.2 21.0 -

France 22.6 15.0 -

UK 6.4 8.8 -

*Estimated, Source: UNDP, HDR 2000, 2011

How could countries like The Netherlands and Germany reduce the use of fresh water? Thewater import dependence (WID) data of few major economies of Europe and USA will explain

the above observation.

WID (expressed in %), is the ratio between water footprint of a countrys import and its total

water foot prints. The higher the ratio, the more a country depends on outside water sources.During 1997-2001, the water import dependence of the Netherlands, UK, Germany, ItalyFrance and Spain were 82%, 70% ,53%, 51%,37% and 36% respectively. The corresponding

figures for India, Bangladesh, China, and Brazil are 2%, 3%, 7% and 8%. And the WID of Japanand USA, during that period, were 64% and 19%.vii

Thus during 1997-2001 the Netherlands could reduce, through imports, the countrys total waterfoot prints by 82%! This explains how The Netherlands could reduce their fresh waterwithdrawal figs (refer table 1) to 12.6% from as high as 71.0%. The concept of virtual waterwill help us to understand this mechanism better.

Virtual/embedded water is the amount of water used in the production of food, energy and otherproducts. It is the embedded water content of a product. If a country decides to rely more onimported food, it can save enormous amount of its own water which otherwise would have been

used for cultivation. For example, to produce one ton of wheat, say, 1160 cubic meters of wateris required. That means, 1160 cubic meters of water got embedded in one ton of wheat. Thus ifIndia exports one ton of wheat to Europe then there is a virtual flow of 1160 cubic meters ofwater from India to Europe.

The concept of virtual water trade is gaining importance. It has been claimed that one solutionto water scarcity involves accounting for the virtual water when designing trade policy.Suggestions have been made to set up a virtual water-trading council, under the World Trade


4/5

Organization (WTO), to help manage both real and virtual water resources for the worlds

boomingpopulation.viii

Concerns

In future, in the name of protecting water resources, developed food importing nations might askfor water labels to guarantee that only pure water (and preferably from renewable sources) be

used in the production of exported food items. By discouraging/prohibiting the use of arsenic andlead contaminated underground water in cultivation and animal husbandry, water labels willensure the safety of the exported food. The World Water Council has already initiated variousmoves to this effect and in its 5th World Water Forum, held at Istanbul in March 2009, it hascalled for, among others, harmonizing strategies for water, food and energy.

ix

In such a scenario, which is very likely, the organic farmers will increasingly rely on renewablenatural water sources for cultivation. Funds will be diverted to develop water bodies to serve thatpurpose. The food processing plants will collaborate with the global water utilities of importingdeveloped countries to guarantee that water purification level, as specified in the water standards,

is maintained. A part of these organic foods will be sold, to the affluent domestic consumers,through organized retail chains. And for the remaining hungry millions, GM grains will becultivated with arsenic contaminated ground water.

While the citizens of the importing countries of the North, would consume green products,

large number of the underprivileged population of Southern countries like India would lose theirbasic rights on water. The transnational water utilities will take charge of the municipal water

distribution servicesx.

The world is increasingly getting divided between the green and indigo economies. (Dey2010)xi The indigo economy represents economic activities which primarily use dirty and

polluting production process.This also represents an economic program that is mostly meant forglobal markets and is detrimental, as was the case of indigo plantation of the 18th century, to the

large section of the local population.

The developed economies are becoming green at the expense of the developing economieswhich are turning indigo by absorbing increasing amount of Franken foods and industrialpollutants, including nuclear radiation.

According to Hindu mythology, to save mankind, lord Siva, the creator of the Universe, hadabsorbed all poison of the Earth at his neck and became Nilkantha indigo-necked. Like lordSiva, the inhabitants of these developing emerging economies would also turn into indigoxii byabsorbing all poison of the Earth.


5/5

End notes

i See,http://www.unwater.org/downloads/UN-Water_Report_for_Rio_Summary.pdf, visited January 15, 2013ii See,http://www.oecd.org/water, visited January 15, 2013iii For details see, Dey, Dipankar, The Second Green Revolution in India: The Emerging Contradictions,

Consequences and the Need for an Alternative Initiative (August 12, 2009). Available at SSRN:http://ssrn.com/abstract=1447795iv Between 1987 and 2002, the total private investment commitment in water and sewerage in developing countrieswas $35 billion.10% of this was FDIs. Three water TNCs, namely Thames-RWE (Germany); Suez Lyonnaise(France); Veolia Environment SA (France), were the major investors in water services.. See, World InvestmentReport (WIR), 2004.v Euobserver.com, (March 16, 2005), EU pressures developing countries for access to water services,http://euobserver.com/?aid=18673Visited August 11, 2009

vihttp://www.eurunion.org/eu/index2.php?option=com_content&do_pdf=1&id=40, May 6, 2009vii See Gardner G (August 6, 2009), Water Scarcity Looms, World Watch Institute,http://www.worldwatch.org/node/6213?emc=el&m=279787&l=4&v=a274235068

viii See, Virtual water trading could benefit developing countries, February 13, 2007. http://

www.unisa.edu.au/news/2007/130207ix http://www.worldwatercouncil.org/fileadmin/wwc/World_Water_Forum/WWF5/5th_Forum_Highlights.pdf,visited on January 12,2010x After privatization of the municipal water and sanitation services in Cochabamba, the third largest city of Bolivia,in 1999, Aguas del Tunari (owned by the U.S. transnational company Bechtel along with Italy's Edison and Spain'sAbengoa corporations) had been awarded with the 40-year concession to supply water in the city. The foreigncompany hiked water rates by as much as 200 percent. Water bills amounted to 20 or 30 percent of the income ofpoor households. Even wells that had been dug by local communities or cooperatives as a solution to their lack ofpiped water came under the control of Aguas del Tunari, which thus acquired the right to charge for the water fromthe community wells that it had not even dug itself. See, Franz Chevez, Cochabamba's 'Water War', Six Years On,http://ipsnews.net/print.asp?idnews=35418, visited January 16,2013.

xi See, Dey, Dipankar (2010), Of Global Warming and Indigo Economy, The Frontier Weekly, Vol.43, No.6, August

22-28, 2010. Also available at SSRN:http://ssrn.com/abstract=1601269.xiiOriginally the term Blue economy was used. See Dey. Dipankar (2007) SMEs: Rising Opportunities in theEmerging Blue Economy, published (October, 2007) in ie2 (Internationa l edition)the monthly magazine ofEEPC (Engineering Export Promotion Council), Ministry of Commerce, Government of India.
http://www.unwater.org/downloads/UN-Water_Report_for_Rio_Summary.pdfhttp://www.unwater.org/downloads/UN-Water_Report_for_Rio_Summary.pdfhttp://www.unwater.org/downloads/UN-Water_Report_for_Rio_Summary.pdfhttp://www.oecd.org/waterhttp://www.oecd.org/waterhttp://www.oecd.org/waterhttp://euobserver.com/?aid=18673http://euobserver.com/?aid=18673http://www.eurunion.org/eu/index2.php?option=com_content&do_pdf=1&id=40http://www.eurunion.org/eu/index2.php?option=com_content&do_pdf=1&id=40http://www.eurunion.org/eu/index2.php?option=com_content&do_pdf=1&id=40http://www.worldwatercouncil.org/fileadmin/wwc/World_Water_Forum/WWF5/5th_Forum_Highlights.pdfhttp://www.worldwatercouncil.org/fileadmin/wwc/World_Water_Forum/WWF5/5th_Forum_Highlights.pdfhttp://www.worldwatercouncil.org/fileadmin/wwc/World_Water_Forum/WWF5/5th_Forum_Highlights.pdfhttp://ipsnews.net/print.asp?idnews=35418http://ipsnews.net/print.asp?idnews=35418http://ssrn.com/abstract=1601269http://ssrn.com/abstract=1601269http://ssrn.com/abstract=1601269http://ssrn.com/abstract=1601269http://ipsnews.net/print.asp?idnews=35418http://www.worldwatercouncil.org/fileadmin/wwc/World_Water_Forum/WWF5/5th_Forum_Highlights.pdfhttp://www.eurunion.org/eu/index2.php?option=com_content&do_pdf=1&id=40http://euobserver.com/?aid=18673http://www.oecd.org/waterhttp://www.unwater.org/downloads/UN-Water_Report_for_Rio_Summary.pdf

Integrated water resource management in an emerging ‘green economy’ – few concerns

Documents

Transcript of Integrated water resource management in an emerging ‘green economy’ – few concerns