Erratic progress of the monsoon and the prospect of a drought in a number of states have once again cast a shadow on the livelihoods of millions of Indians and the health of the economy. The 8.2 per cent growth in GDP in 2003-04 was made possible by a 9 per cent farm growth brought about by an unusually good monsoon. The resulting improvement in rural demand had created conditions for a jump in investment in manufacturing and services. Unless the monsoon springs a surprise by staging a strong revival, the upswing in the investment cycle would surely be arrested and GDP growth rate could once again slip to around 5 per cent or even lower.
The cold statistics of GDP growth numbers do not capture the unspeakable misery that a drought inflicts on millions of Indians, particularly in rural areas. With their crops destroyed, small and marginal farmers not only lose their incomes for the current year but also future earnings as they are unable to pay their loans and sink into a debt trap. They also lose their means of production in the form of cattle that perish for want of food and water. The landless suffer even more as jobs vanish when crops die. Children are pulled out of school, and along with their mothers have to trudge miles to fill a mere pot of drinking water. There is a perceptible rise in the number of poor below the poverty line.
Indians who do not suffer directly from lack of rains do not remain unscathed. Demand for manufactured goods and services falls with rural purchasing power, and incomes and jobs are affected in urban areas as well. Urban poverty levels rise too, and drinking water and electricity supply to cities shrinks. The system as a whole is jolted. The short point is that water is a critical input for the economy as a whole and, at least for our economy, no less important than the other four factors of production mentioned in economic theory viz. land, labour, capital and technology (knowledge).
Unfortunately, this fifth factor of production has not been given the importance it deserves. For example, the over 300 page Economic Survey, the most authoritative official review of the economy, accords a cursory treatment to the subject. The RBI reports on currency and finance are no different. Considering that the potential loss to the economy caused by scarcity of water over the last 50 years would be a mind-boggling number, this indifference cries for correction.
Even today, over 40 per cent of our food grain and two-thirds of cotton and oilseed crops are grown on dry lands without the facility of irrigation. Even on irrigated tracts, the drought reduces the productivity and output of crops. Put differently, at least half or more of our farm production and a third of our population is directly impacted by a drought. Add to this the impact on the non-farm sectors of the economy.
It is possible that a perennial shortage of water subtracts at least one or two percentage points from our GDP growth and denies opportunity of incomes and sustenance to over 200-300 million Indians each year. I wonder whether our planners have a ready methodology for refuting or accepting this argument. To take an example, the last estimate of the number of households that have access to safe drinking water dates back to 1991. The latest data from the 2001 census has still not been processed!
Mercifully, the latest budget recognises that water bodies and tanks that have ceased to exist because of years of neglect need to be revived. A pilot programme has been launched to rejuvenate these. There is some rethinking on drinking water schemes as well. The Accelerated Irrigation Benefit Programme too has been revived. This is all to the good. But the focus would have to be sharpened in both the Central and state plans. A National Water Mission that looks at all the dimensions of the problem and is empowered to implement solutions is a crying need of the hour.
Higher allocations alone would not quench the thirst of our people and dry lands. Out schemes would have to be revisited and modes of implementation reconfigured. As announced by the finance minister, the Planning Commission is slated to review all the plan schemes. Hopefully, water in all its uses would be one of the focus areas. Indeed, we need a white paper on water outlining the problem in all its dimensions, its impact on growth, employment and poverty and the investment gap and benefits to be had by more investment in water.
The paper must outline an enabling environment and regulatory framework for promoting investments in water, pricing policies and also public-private partnerships for implementation and delivery. There must be a national campaign for and on water. Let?s begin now.
The author is an advisor to Ficci. Views expressed herein are personal