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Business Recorder

Published Date: Nov 23, 2017

Water inflation

Going by what Pakistan Bureau of Statistics measures, water inflation in Pakistan isn’t an item on the worry list. But do a survey of Pakistani households, and you are likely to find out that their spending on water – drinking or general household usage – has been on the rise in recent years, as is the water shortage. This trend is most visible in Karachi that alone boasts 17 percent of the 76 markets currently tracked by the PBS for the composition of its consumer inflation basket.

Water shortage in Karachi is met through private water bowsers that fill the gap left by piped water supply by the public sector. Whereas for drinking water, the market of bottled players is increasing; in terms of volume alone the market has increased three-folds in the last five years, and by 2021 it is estimated to grow four-folds over 2011, according to Euro monitor estimates.

This growth doesn’t only stem from water shortage in Karachi but also from Punjab’s urban centres and their adjoining areas – the likes of Lahore, Faisalabad, golden-triangle – where ground water availability is receding. Dr Imran Khalid at the Islamabad-based SDPI, who closely follows water woes in Pakistan, says the long-term implication of falling water tables are severe, and requires a holistic water policy – one which addresses the many issues raised in the 3rd Karachi International Water Conference held earlier this week.

Back to water inflation! The PBS has assigned a combined weightage of 0.6 percent to water consumption in its inflation basket. In some ways it is rather strange, because it has assigned 0.10 percent weightage to drinking water – tracked by 1.5L mineral water bottle – and 0.497 percent weightage to piped water which is tracked by water charges per house per month. It is strange because drinking water is always more expensive than the water bills sent by government bodies. With growing urbanization – and current CPI is an urban measure – bottled water consumption is taking portion of the wallet, though of course as is oft the case, studies to this effect are conspicuous by their absence. Secondly, the PBS doesn’t measure the water purchased through the bowsers or tankers. The PBS argument for not measuring private water tankers is the fact that they are compelled to follow a certain international methodology for price collection and because water tankers aren’t always a part of the legal supply chain, they cannot track its prices. Most discussions on water begin and end on dams and politics. But while politics is everywhere in any case, there is much to water than dams. Pricing and measuring is one of them; the former is important to clear the market; after all the people are already paying a higher price for quality water supply – whether in ‘Machar Colony’ or in an upscale area. Whereas measuring is important because if you can’t measure, you can’t improve.

This column submits that the PBS should come up with one methodologically robust techniques or another to track water consumption in the country, even if tracking tanker water supply is not as per international standards. Because our reality is local, measuring mechanism should also be local. Second, discussions on water must begin at the nexus of water pricing, water metering and water conservation at household, commercial/industrial and at farming level – these policy tools are critical to water solutions. Be warned: failure to the fix the looming water crisis will haunt more than power crisis.