People's Democracy

 Water – The New Battleground

 Jayati Ghosh

THE failure of the WTO meeting at Cancun has diverted public attention from another very important battle that is still being fought in the WTO at Geneva. This is about the privatisation of services and utilities, especially water, which has become a focal point of tension between corporate capital interested in prising open developing country markets, and developing countries whose citizens will be badly affected by this.

There has never really been a time, at least in recorded human history, when control over water resources has not been an issue. Wars have been fought over water all over the world; states and rulers have spent much time and energy over the allocation of water; dominant forces have always been able to grab more of this precious and indispensable resource and deprived the less powerful. Even Kautilya’s Arthashastra, written nearly two thousand years ago, talked about the issues involved in the distribution and consumption of water.

WATER INDUSTRY

But the past few decades have witnessed an accentuation of water tensions across the globe. Global water demand is currently estimated to increase at a rate that is more than double the rate of population growth. This makes it increasingly scarce.

When something is scarce, the likelihood of a market emerging in it is very likely, especially in our times when everything seems to lead to a market. This explains the explosion of the “water industry” over the past two decades, and the growing interest of multinational corporations over all aspects of the treatment, distribution and consumption of water.

This is one of the fastest growing industries in the world, and one of the more concentrated. Two major multinationals – Suez Lyonnaise (now called Ondeo) and Vivendi – dominate the world water market, with other companies such as Bechtel also being significant players.

Of course, for this to be an area of private profit, the role of government has to be reduced. So governments now do not see the provision of safe drinking water as a basic responsibility. There are now private players engaged in the treatment of water to render it “safe” and potable, in the provision of piped water to consumers, in sewage and sanitation works, in the bottling and distribution of packaged water, in controlling and monitoring the access to fishing and various other uses of forms of water which were seen as common property resources such as rivers and lakes, and so on.

PRIVATISING WATER

The process of creating markets for water has been significantly advanced by the World Bank and the IMF, both of which have included schemes for commercialising and privatising water in their recent conditionalities for loans to developing countries. Even without such pressure, several governments of developing countries and provinces within countries have decided to privatise water resources or at least to hand over effective control to private managers.

Privatisation tends to increase the prices paid by consumers, often very dramatically. In England, prices rose by 106 per cent between 1989 (the year water was privatised) and 1995, even as the profits of water companies went up by 692 per cent. In Paris, France, the privatisation of water services meant an increase in consumer prices by 300 per cent between 1984 and 1997.

In Bolivia, where the government was forced to sell the public water system to the multinational Bechtel due to World Bank pressure, the experience was even more disastrous. Not only were water prices doubled, local residents were even forced to buy permits to gather rain water on their own property. Water became more expensive than food. Public anger, culminating in the famous protests at Cochabamba, forced the government to backtrack and revoke the privatisation law.

PEOPLE’S ASSERTION

While Bechtel is suing the Bolivian government for breach of contract, a citizen-government partnership in Cochabamba has organised the universal, fair and reliable provision of water. They have managed to bring down prices, build new tanks and pipe water to neighbourhoods that did not receive it earlier. Obviously, all this can be accomplished if there is sufficient political pressure.

So citizens have a right to influence and shape policies regarding water, which will after all affect their lives so dramatically, and that the treatment and distribution of water must be determined by public choices, rather than private profitability. In addition, because water is a renewable resource, choices over time also matter, and societies have to decide how to use and conserve water. This simply cannot be done in circumstances in which the major providers are motivated by short-term gain, as is necessarily the case with private providers. The latter case will result in water being monopolised by the rich, and used extravagantly in the present without regard to the future.

In spite of all this adverse international experience, the effort to privatise water is actually gaining momentum in India. Several state governments have moved to privatise water supplies in certain municipalities. In Hyderabad, Delhi and other major cities, major water utilities are being privatised. There are even reports of control over parts of rivers and entire lakes being handed over to private managers in states like Chhattisgarh and Orissa.

If the governments in India fail to learn from other examples, and make citizens go through the agony resulting from indiscriminate privatisation of public services and resources like water, they may also be forced to backtrack. But in the meantime, millions of people will have faced a worsening material situation.