The government is also expected to outline a water regulatory body National Bureau of Water Use Efficiency (NBWUE) and tax incentives/benefits for industries that subject themselves to water audit in a time-bound manner soon.
The ground work and the base studies on water usage by various industries is getting finalised. There is a strong possibility of its mention in the Budget, said a senior functionary of the joint industry task force looking at enforcing efficient usage of water resources.
The water credit can be defined as a certificate showing that a government department, company, individual or industry has saved certain amount of water during particular activity or production process or domestic use. Under the system of water credit, industries will get the permit to use additional 1,000 liters of water (or quantities finalised by NBWUE) that can also be traded in the international market at their current market price.
The idea of water credit comes at a time when there's increasing awareness of the need to control water wastage. According to an internal note, industries or consumers that have not used up their quota of water can sell their unused allowances as water credits, while businesses that are about to exceed their quota can buy the extra allowances as credits, privately or from the open market.
According to a senior official, NBWUE, apart from regulating water credit and water tariff, will also introduce mechanisms for water footprints and water auditing as stated in the National Water Policy 2012. The intention is to ensure better management ofwater demand, the official said.
Under the NBWUE, it will become mandatory for companies to disclose the volume of fresh water used by them for production activities, the volume of recycled water usage per year and a commitment with a time-line on reducing water footprint within a specified period. This would be implemented through the corporate affairs ministry soon, the official said.
The corporate water footprint is defined as the total volume of freshwater used directly or indirectly to run and support a business. The water footprint of a business consists of water used for producing or manufacturing, or for supporting activities and the indirect water use in the producers supply chain. This will now have to be disclosed every year in the company's annual report, the official said.
As part of the mandatory auditing of water, the government will look at the quantity and quality of water and pollutants discharged to the aquatic environment and in the sewage systems. The move has already found support from most state governments and industry bodies like CII and Ficci, sources said.