NationalVolume 12 Issue # 21

Neglecting “liquid” assets

It is a matter of concern that the water sector continues to be neglected by the authorities concerned. This is proved by the fact that although water supply and storage seem to be among top priorities of the government, the utilisation of funds for water projects has steadily gone down. This is so in the face of the fact that the country is facing an acute shortage of water.

Figures show that during the current fiscal year 2016-17, the government has allocated Rs31.72 billion for development schemes in the water sector, but only around Rs24 billion, or 76% of the total, would be utilised by the end of June. This has been disclosed in the Annual Plan 2017-18. The government has not only delayed the release of funds for water projects designed to enhance the country’s storage capacity, but it has also cut fund allocation substantially since coming to power about four years ago. Instead, its focus has been on building the road infrastructure and metro bus projects.

A detailed analysis of the situation shows that after coming to power in mid-2013, the government earmarked Rs59 billion for fiscal year 2013-14, to be disbursed among different projects aimed at conserving and enhancing the country’s water resources. However, out of the total, only Rs35 billion could be spent as the government slowed down the release of funds. In 2015-16, the allocation for water projects was slashed by around 50% to Rs30.12 billion. However, only Rs23 billion was disbursed for injection into the schemes. In the next fiscal year, almost a similar amount, Rs31.06 billion, was set aside for water schemes, but only Rs24 billion would be released by the end of the year. For the upcoming fiscal year 2017-18, a slightly higher amount estimated at Rs36.7 billion has been earmarked for water projects.

It is common knowledge that Pakistan is fast becoming a water-scarce country with increasing shortages, while India plans to build more dams on rivers coming to Pakistan. So far no workable water management policy has been put in place and farmers are forced to consume groundwater with the help of tube wells to irrigate their crops, which inflates power consumption bills. Faced with increasing difficulties, the farmers staged a protest in Islamabad last week on the eve of the budget for 2017-18, to invite attention to their plight as the government seemed to have relegated the agriculture sector to a lower priority zone. In the previous fiscal year, the agriculture sector did not grow, falling far short of the target, which had a negative impact on the overall national economic growth rate. In the current fiscal year, however, the agriculture sector grew 3.46% – its highest level in the past five years.

In the new budget, the government has increased agriculture credit target by 43% to Rs1.001 trillion and has announced loans of Rs50,000 for small farmers. Still, it has paid more attention to the manufacturing sector, which is provided loans at low interest rates whereas the farmers are compelled to bear high interest costs. The fertiliser manufacturers and sugar millers have got billions in government subsidy, but its benefits have hardly trickled down to the farmers.

Experts have warned that Pakistan will face severe energy and food security challenges in future as the government is showing little interest in water supply projects, which are closely related to agriculture production that needs water as a major input. Pakistan has been facing flood devastation for the past seven years. But calls for building more water reservoirs have fallen on deaf ears. At present, water storage capacity of the country is 14 million acre feet (MAF) whereas annual consumption stands at 117 MAF. Consumption of 1 MAF of water has a positive

impact of $1 billion on the economy. Pakistan has been losing billions every year because of water wastage as reservoirs fall short of need.

Per capita water availability has fallen from approximately 5,000 cubic meters per year to around 1,000 cubic meters per year now. According to the World Bank, we are heading towards water availability of less than 1,000 cubic meters per year per person by 2035. In Balochistan, the kaarez have gone dry and in Lahore the groundwater is going down. In its recent report, the Pakistan Council of Research in Water Resources (PCRWR) has warned that the country will approach absolute water scarcity by 2025. The study predicts that if no remedial measures are taken the country will face a drought-like situation in the near future. It is a silent crisis building up with serious consequences for the future of the country.

Pakistan is now facing extreme weather conditions, including frequent bouts of floods and droughts that cause severe damage to the country’s agricultural, livestock and water infrastructure. Much of these costs is attributable to lack of adequate storage capacity. The total dam storage in Pakistan represents only 30 days of average demand, compared to 1,000 days for Egypt and 220 days for India. A new study by the IMF quotes Pakistan as a case study “where, despite an abundance of water a few decades ago, faulty policies have raised the prospect of water scarcity that could threaten all aspects of the economy”. The study says that water scarcity in Pakistan could threaten all aspects of the national economy, while blaming “lack of proper management” for the water mess we find ourselves in.

While the population has been growing fast with a concomitant increase in agricultural and industrial activity, we have done little to build reservoirs and dams to conserve water and prevent water wastage. Over the past many years we have remained engaged in futile discussions on building the Kalabagh dam, but the possibility of building small dams has been ignored. To make a bad situation worse, climate change is threatening to further damage and disrupt our agrarian economy. Environmental scientists have been warning of alternating cycles of floods and drought ultimately leading to severe water shortages. The signs are already evident in recurring floods and bouts of drought in recent years. We must act before it is too late.