Can water be privatised?
- The conventional understanding of stock trading takes an unexpected turn with the emergence of water futures trading on Wall Street.
Water Futures Contract
- The CME Group launched the world's first water futures contract in December 2020.
- Objective: To manage water-related risks in the face of increasing uncertainties due to droughts and flooding.
- The new futures contract allows buyers and sellers to barter a fixed price for the delivery of a fixed quantity of water at a future date.
UN Special Rapporteur's Concerns
- The UN Special Rapporteur on the human rights to safe drinking water and sanitation, expressed concern over treating water as a commodity on Wall Street.
- He fears that hedge funds and large players could marginalise vulnerable sectors, such as small-scale farmers, leading to potential economic disparities.
Water Scarcity Challenges
- Water scarcity, caused by overuse of groundwater, climate change, and rapid urbanisation, is a global challenge.
- The UN 2023 World Water Development Report highlights that 26% of the world's population lacks access to safe drinking water.
Water Scarcity in India
- The World Bank identifies India as one of the most water-stressed countries globally.
- India, with 18% of the world's population but only 4% of its water resources, faces severe water stress.
Constitutional Framework for Water Disputes
- The Directive Principles of State Policy in the Constitution emphasize the distribution of material resources for the common good.
- The Indian Constitution addresses water disputes through Article 262, allowing Parliament to legislate on disputes related to inter-state rivers or river valleys.
- Hence, Parliament enacted the Inter-State Water Disputes Act, 1956, establishing Water Disputes Tribunals to resolve such conflicts.
- Such disputes may arise out of the use, distribution, or control of water that flows between states.
Judicial Perspective on Water Rights
- The Supreme Court of India has played a crucial role in water-related issues.
- In Narmada Bachao Andolan v Union of India (2000), the Court ecognized water as a fundamental right under Article 21 of the Constitution.
- In A.P. Pollution Control Board II v Prof. M.V. Nayudu (2001), it declared that it is the duty of the state under Article 21 to provide clean drinking water to its citizens.
Challenges to Water Access and Distribution
- Water pricing in India is determined by states, lacking a centralised authority.
- Privatization efforts, known as "water sector reforms," raise concerns about affordability and equitable access.
Conclusion
- As water faces the risk of becoming a tradable commodity, treating water as a constitutionally protected natural resource is important.
- Ensuring equitable access and distribution is crucial to prevent water scarcity from becoming a norm, making it unaffordable for many.