Water Use Reform Will Be Difficult for Fractured India

Stratfor 2015-06-28

Because of its massive river systems and variety of climates, India is not always the first country that comes to mind when considering water stress issues, but the emerging regional powerhouse is still an agrarian society at its core. This already inefficient sector relies on inconsistent monsoons and, in some locations, on groundwater to make up for years with deficits in rainfall. Increasing urbanization and population growth have compounded demands for municipal water and increased agricultural production. By 2030, India is projected to consume nearly 1.5 trillion cubic meters of groundwater annually — more than its estimated 1.1 trillion cubic meters of usable reserves. As New Delhi faces a major challenge in managing this essential resource, India's highly decentralized system will make it difficult for the central government to effectively manage the problem.

The history of the Indian subcontinent has been shaped by water. To the southeast and southwest, India's coastlines front the Bay of Bengal and Arabian Sea, while to the north, the Himalayas separate the country from Eurasia. Inside this self-contained world, a multitude of rivers have produced a variety of powerful city centers as well as the internal divisions that have resulted in India's strong regional identities — identities that centralized powers have always struggled to balance.

Today, one of New Delhi's core geopolitical imperatives is to control the fertile Ganges River Basin, which is key to maintaining the country's agricultural sector. Agriculture accounted for 18 percent of India's gross domestic product in 2012 and employs about half of the country's population. It also accounted for more than 90 percent of total water withdrawals. While India does possess natural renewable water resources that total roughly 1.9 trillion cubic meters, rainfall distribution is naturally erratic and dependent on seasonal monsoons, leaving agricultural production highly susceptible to fluctuations. The 2014 monsoon season officially concluded at the end of September with cumulative rainfall 12 percent below the long-term average. Increased rainfall near the end of the season meant that more dire predictions from earlier in the year did not come to pass, but many crop production estimates for 2014-2015 are still expected to fall year-on-year.

Water Stress
The Indian agricultural sector's reliance on groundwater irrigation to maintain crop yields, especially in weak monsoon years, has been steadily increasing since the 1950s. Over the past 20 years, 84 percent of added irrigation has come from groundwater sources. Today, 50-70 percent of India’s crops rely on irrigation — an estimated 60-80 percent of which uses groundwater. India's use of these resources is also extremely inefficient. The amount of water it takes to produce one ton of grain in India is 24 percent higher than the global average for both wheat and rice.

Further exacerbating the water scarcity problem is the fact that not all of India’s water supplies are usable; much of the supply has been compromised by pollution or fertilizer use. Inadequate infrastructure prevents the use of some of the annual renewable water resources as well. India’s Ministry of Water Resources estimates that only 1.1 trillion cubic meters of the country's total 1.9 trillion cubic meters of natural renewable water resources are usable. Independent studies put this number at 650 billion to 750 billion cubic meters, less than half of India's total annual renewable amount.

The greatest evidence of groundwater depletion can be seen in India's north, an area that includes the fertile Indus and Ganges basins. New Delhi has made this worse by applying only limited regulation to groundwater extraction and by subsidizing electricity, which, among other things, helps makes pumping water more affordable. At the same time, the municipal sector has come to rely on groundwater to meet more than 80 percent of the urbanized population's growing demand.

India's current water withdrawals add up to between 630 billion and 760 billion cubic meters per year, and this is set to expand. India’s population is increasing at an average annual rate of roughly 1 percent, and urbanization rates are high, at 31 percent in 2010 and projected to rise to 43 percent by 2035. The government is also working to increase access to electricity and maintain food security, both of which will require steady water supplies. All of this will contribute to a projected rise in annual water demand to nearly 1.5 trillion cubic meters by 2030 — a number higher than India's existing usable water resources (which the government generously estimates to be around 1.1 trillion cubic meters) can meet. By 2030, most of India’s many river basins could face gaps between supply and demand. At the same time, the nation's per capita annual water supply fell to around 1,500 cubic meters in 2011. This is projected to approach the water scarcity line of 1,000 cubic meters per person by 2050.

At the same time, these declines in groundwater levels could actually increase India's water demands by speeding up the rate of urbanization. As groundwater levels decline, wells become more expensive to drill and operate, meaning that more farmers will not be able to afford to water their crops using groundwater. This has already driven many subsistence farmers off the land and into cities. The urban population will increase pressure to supply municipal water and will strain the agricultural sector as India tries to maintain food security in the face of its growing population.

Constraints on the Center
India's water constraints will continue to worsen, but the change will be long and gradual, stretching out over several decades. The situation could ease if the country shifts its water consumption patterns or if New Delhi changes its water management policies, perhaps by regulating well drilling, implementing new water-efficient irrigation technologies or making improvements to water infrastructure. Such programs, however, will face the barrier of India's regional political fractures, which make central management difficult. Programs to increase efficiency or improve water management policies, such as the implementation of more efficient irrigation practices, would likely have to be implemented at the state level, resulting in regional (not national) solutions.

Indian Prime Minister Narendra Modi, despite hopes to the contrary, will likely be limited by these same geopolitical constraints. New Delhi might manage to make a slow push for higher efficiency by reducing subsidy schemes, as it has done for phosphate-based fertilizers. The phosphate fertilizer subsidy reduction showcases the difficulty of this approach: Other fertilizers are still subsidized, meaning that the problems of pollution and inefficient use or overuse of fertilizers remain. Modi is still unwilling or unable to adjust the broader fertilizer subsidy framework that plays a large role in perpetuating poor agricultural practices.

The slow and fractious nature of the reform process means that over the next 20 years New Delhi will continue to cope with increasing water stress. At the present time, India is essentially self-sufficient in agriculture. However, over the next decade, it is likely to become a food importer. Inadequate supply chain infrastructure will impede efficient food distribution. To maintain social stability in the face of this challenge, New Delhi will likely have to sacrifice some economic growth and possibly take on additional debt as its import bills rise.

Courtesy : Stratfor (www.stratfor.com)