MUMBAI: Increasing policy thrust on water that got amplified amidst the ongoing crisis plaguing Chennai and other drought-prone areas elsewhere in the country, will result in an investment of USD 270 billion over the next 15 years, says a brokerage.
The controversial river-linking project alone will account for USD 168 billion in investments over the next 15 years, while the ambitious plan to supply piped water to every home will entail another USD 94 billion, according to an estimate by American brokerage Bank of America Merrill Lynch. "It is very difficult for the government to find all the resources needed to be invested in such projects and it is important for models to evolve to ensure that the private sector can participate," its co-head for India research Amish Shah told reporters Tuesday.
He also said policies need to seriously look at the ways of reducing water intake, and pointed to the data such as a whopping 5,600 litres of water needed to produce 1 kg of rice in the country, against just about 300 litres for the same in China.
Pointing out that as much as 89 percent of the entire available fresh water is used by agriculture, Shah said free or subsidised power in many states is something we must to look at as free/subsidised electricity incentivises over- usage/wastage of ground water.
During the past five years alone, investments on water related infra have grown at a compounded annual rate of 15 percent and touched USD 21 billion last fiscal, he said.
But he was quick to add that the entire USD 21 billion were put in by the states alone, as water is a state subject, but the Centre has pitched in with some investments of its own, especially in the clean Ganga project, he said, adding even in the current budget, it has set aside USD 2.5 billion for this.
Over USD 1.5 billion have already been spent on the Ganga project during the past three years and an additional USD 3 billion will be invested over the next five years, most of which will go into sewage treatment plants, he said.
The estimate on the river linking project, where work is underway on two large projects (the Kent-Betawa project in the water-starved Bundelkhand region of UP and the Polavaram project in Andhra), is based on the master plan prepared by the respective states, he explained.
As the Godavari-Krishna-Cauvery linking had found a mention in the previous minister Nitin Gadkari's comments, it can be the next project to be taken up, Shah said, explaining that very little is known of the government's next moves.
He said the brokerage team had met officials from the newly-created Jal Shakti ministry for this research. The PM's irrigation scheme will entail in investments of USD 4.5 billion over the next five years, he added.