Drinking Water is Food

Drinking Water is Like Food—bottle it and deliver it to the poor immediately

 

K E Seetharam

 

The Asia Water Watch 2015, commissioned by ADB, WHO, UNDP, and UNESCAP, estimates that another 700 million people—at minimum—will need to be served in Asia over the next decade to meet Millennium Development Goal (MDG) target 10 on safe drinking water alone. When I started to coordinate the preparation of report in 2005, the big question that I had in my mind was how can this massive target be achieved expeditiously? Developing country governments and development organizations are attempting to partly answer this question. In early 2006, I assisted ADB in announcing its Water Financing Program 2006-2010. The Program, one of the most concrete actions publicly announced so far by international organizations, will double ADB's investments in the water sector to over $2 billion annually for the next five years. But typical development projects take at least 3 to 5 five years for their development and physical implemention. What do we do until then? Do we simply wait? Water is life; and people cannot live without safe drinking water.

 

The first 1 to 2 liters of clean water for drinking purposes, is essential for human survival and has the maximum benefit for the individual as well as economy. This water is like food or medicine.

 

State run water utilities aim to distribute 100 or more liters per capita per day. But they lose up to 70% of the water they produce through leaks and thefts. While the water they produce in their treatment plants is reportedly potable, unfortunately the water that reaches the taps is not—because of intermittent supply.

 

On the other hand, private water bottlers distribute packaged drinking water. Though some think it is a drink for the well off, packaged water is being consumed by a large population, including the poor, in many developing countries.

 

The Asian Development Bank's operational evaluation department highlighted in its impact evaluation study in 2002, that policy makers, perhaps, underestimated in the past two decades the challenge with no clear policy on reaching the first two liters of safe drinking water. The findings of the OED study that were presented at the Third World Water Forum in Japan in 2003, alerted policy makers and development partners that the small quantities of water for drinking purposes need not be distributed through taps—and perhaps will not be reliably available in taps in many developing countries in the near future. (see graph of water as food, need, and good)

 

The next question is? What would it cost to deliver the 2 liters of safe drinking water to each person? The cost of producing water at the water utility ranges between US cents 12 to 20 per cubic meter, i.e. 1000 liters. On the other hand, the price of water bottled water ranges from US cents 10 to 50 per liter.

 

There are 2 important reasons why water utilities should enter the business of bottled water:

 

1. Water utilities have the mandate the provide water to all citizens (which is 98% of the water demanded, if the first 2 liters per day of drinking water is not counted). It is important that they are also seen as players in the drinking water market (2% of the water demand). This is a good market for water utilities to come in, because the willingness to pay for the first 2 liters of water for drinking purposes is the highest.
   
2. It is important for the citizens, especially the poor, that water utilities start to deliver this first 2 liters of drinking water. Once they enter the bottled water market, the market price for bottled water will come down significantly. When the price comes down, citizens will benefit from the savings in consumer surplus.
   

 

Skeptics have asked whether the poor will be willing to pay for the drinking water. People will automatically pay for it, once it becomes available. In my view, the small quantities of safe drinking water (at 1-2 liters per capita per day) should be made available as food to all citizens by the water utilities without having to worry about cost recovery.

 

The annual per capita consumption of drinking water would be less than a cubic meter (i.e. 2 liters per day x 365) and therefore would not cost more than US cents 10. That is a very small amount—less than 0.1% of the GDP of the poorest of Asian nations—that any country can afford!

 

When all the capital and operation and maintenance costs of producing and distributing water (i.e. source development, production, treatment, packaging, transportation, and distribution) are taken into account at current prices (without including profits of private bottlers), the cost of drinking water per liter would be less than one-tenth of a single US cent. Anybody can afford to pay this amount. When compared to the current US 50 cents per liter charged for the most expensive bottled water, the cost of the water produced by the water utilities would be insignificant!

 

In PRC and Lao PDR, state-run utilities sell bottled drinking water and compete in the market with other domestic and international private bottlers who also produce drinking water. The governments regulate the quality of drinking water like milk and other soft drinks. It is interesting to note that the utilities that also sell packaged drinking water provide 24x7 piped water supply. These utilities also recover full costs of operation and maintenance. Furthermore, when water for drinking is unbundled at source, the utilities' resulting transmission losses also decline—the non revenue water rate reduces by 2 percentage points.

 

With less than 10 years remaining to reach the MDGs we need to think outside the box, beyond the traditional development projects that take many years to prepare and implement. Can we not think of ways of providing the small quantities of safe drinking water immediately to all citizens? Together, we can make a difference, in the International Water Decade. Let us envision a day when even the poorest of poor will drink safe drinking water. Let us get it done quickly.