Putting a Price Tag on the Drop of Life

By Thameenah Razeek | Published: 2:00 AM Feb 27 2021
Focus Putting a  Price Tag on the Drop of Life

By Thameenah Razeek

The Government’s move to export water in a bid to earn foreign exchange has raised many questions, especially at a time when there are concerns whether the available quantity of water in the country is enough to meet the demand of the country’s entire population. Since the indirect cost of desalinating water for domestic purposes is much higher, a better strategy would have been to direct those water resources towards domestic needs.

Recently, Trade Minister Dr. Bandula Gunawardena said the Government is paying attention to exporting water and research is being conducted for this purpose.

He said in addition to traditional exports, good foreign exchange could be earned by exporting water, adding that Japan and France are currently earning large incomes by supplying water to the world market.

Professors Saman Seneweera, Rohan Weerasuriya, Athula Senaratne and Lakmal Jayaratne have conducted this research and confirmed that one part of the water bubble belonging to the Hope Estate can be drunk without purification.

He further said as the Minister in charge of Trade, he has a responsibility to promote exports and to diversify the market and shift the market towards Western Europe to the African and Asian regions.

“Sri Lanka is rich in water resources and had a historical heritage of water management and water transfer from one place to another,” he noted, adding that building a water economy is not a difficult goal for us.

He also said the local bottled drinking water business is a large-scale trade in the country and it is the responsibility of the Consumer Affairs Authority to look into the release of quality bottled drinking water to the market.

He said there are instances where bottled water is not bottled properly and sold without the SLS standard certification and while focusing on providing high quality water to local consumers, special attention has been paid to increase export earnings by exporting water.

“When we earn Rs 10-11 billion a year from exports, we spend Rs 20-22 billion on imported goods. As a result, there is a long market deficit of around Rs 10 billion every year,” he said.

He said that if steps were not taken to increase export earnings, the rupee would depreciate against the dollar every day and the dollar, which was Rs 4.75 at the time of Independence, at Rs 8 in 1977, would now be nearly Rs 200.

Political to Market Commodity

Speaking further, he noted that water is rapidly moving from a political commodity to a market commodity as water shortages call for innovative solutions. Markets are redistributing water between traditional needs such as agriculture and urban uses as well as reallocating the precious resource to environmental uses such as fish and wildlife habitats.

Though most of this reallocation is still taking place within political jurisdictions, there is increasing pressure to allow for markets across borders, making water a new export commodity. Economic growth, rising incomes, and growing populations are all contributing to the pressure to switch from political to market allocation, as growing demands outstrip government supplies.

This actively demonstrates that International free trade agreements such as the North American Free Trade Agreement (NAFTA) and World Trade Organisation (WTO) have the potential to create international water markets. 

Some foreign trade representatives see water markets as an opportunity to help alleviate water shortages in their home countries. But other countries with vast water supplies argue that it will be impossible to turn off the tap to lucrative water markets once trading begins. They worry that their countries will be drained dry under free trade. 

“Water is essential for all life on the planet and it is almost impossible to produce a meaningful estimate of the value, for example, of the ecosystem services it delivers. Further work is therefore needed to develop methodologies to make such estimations, because what doesn’t get valued runs the risk of not being protected,” he noted.  Dwellers in rural areas that annually face drought raised their concerns and fear about the risk that they will face if the government starts to export water. 

“Our ancestors were farmers and we were also farming for years and currently we had to stop everything because we are having a large scale water shortage. We heard the story that the Government is planning to export water, but what made us so disturbed is how the Government could decided on exporting water when the citizens in the country do not have enough water for their farms,” a dweller in Mahiyanganaya area lamented.

Discussion 

While having the same opinion that there are people who suffer due to the shortage of water, Minister of Water Supply Vasudeva Nanayakkara noted that even though the water will be exported on a large scale, they will ensure that the people across the country are provided drinking water 24/7. 

He said that the investigations regarding the export of water has already begun and then they will hold a special discussion regarding that. When asked if the the drought in country wasn’t an obstacle to export water, Nanayakkara noted that they will give priority to the country’s citizen, and then ensure whether there is excess water that is sufficient for export. “Currently we are conducting a survey to record the number of groundwater sources. Currently there are companies that export bottled drinking water and they are using groundwater sources which have not caused any problem to local consumers,” he noted. 

He said businessmen engaged in the bottled drinking water industry, should be charged a significant sum. “While such businessmen rake in large profits, the Government obtains only a small share. Bottling water has become a major business with exports also increasing. Water resources will be studied to determine the content of water that is being used for such businesses. Such businesses must be regulated and the Government will focus on charging individuals per litre.”

But Secretary to the Ministry of Water Supply, Dr. Priyath B. Wickrama, is of the view the Government can get a high income if they provide water to the harbours including the Hambantota Harbour. “We had an excellent vision of earning a good income by providing water to the harbour but for some reason we couldn’t achieve that goal. But I think that more than exporting water we will be able to earn good revenue by providing water to the harbours,” he noted.

Water not used

He also pointed out that waters from the Kalu Ganga and Gin Ganga are not being utilised properly and the water is flowing to the sea in vain.

He claimed the waters of the Gin Ganga and Kalu Ganga are not being used for any agricultural purpose. The water in the upcountry is not being utilised as the Mahaweli water is being used. “But we are in the path to divert the water streams to agricultural lands which will cost a lot and acquires a big effort. The previous Government unfortunately did not initiate any projects to find a way to utilise the water but now we are trying to do so,” he said adding that studies are being conducted to divert the rivers and water streams. 

Accordingly, about 5-7 per cent of the people across the country have no access to clean water. The Ministry of Water supply has identified the issue and by the end of 2025 access to clean water will be increased by 100 per cent. 

The World Bank report prepared in 2019 cited that Sri Lanka also possesses a strong potential in its offshore wind resources in the northern part of the country. The offshore wind resources need to be studied as a potential power resource, which if developed, could potentially be utilised to export the excess power to India via the interconnection line. Going forward, in the medium term (through 2023), Ceylon Electricity Board (CEB) may also explore the potential of the offshore wind resources.  

At the early stage, power supplies were in surplus, and even export to India was considered. Further, many of the mini-hydro and thermal systems were near their end of life at that time and needing extensive repairs or total replacement. These issues, together with the prospect of low-cost and reliable electricity supplies, acted as strong incentives for the tea industry to switch over to the national grid operated by the CEB. 

In 1990, the first attempt at using small hydropower plants to export energy to the national grid was experimented. Success was achieved in 1996, with the commissioning of the first grid connected power plant (namely, Dickoya). This set the stage for the development of a Standardized Power Purchase Agreement (SPPA), which turned a new leaf by streamlining the process of selling power to the CEB, the operator of the national grid.

Recalling King Parakramabahu’s famous quote on water conservation and utilisation – “do not release even a drop of rain water to the sea without putting it to good use” – Dr. Wickrama concluded saying that they are putting their utmost effort to get the best revenue from the water industry.


THE TROUBLE WITH WATER

Data shows that world groundwater extraction has increased by one per cent every year since the 1980s. The International Panel on Climate Change (IPCC) also warns that for every degree of global warming, an extra seven per cent of the world’s population face a circa 20% diminution in renewable water resources.

Global leakage figures may seem huge, but marginal when set against 70% of the earth’s surface being covered by water. Yet 97.5% is salty or brackish. Of the 2.5% freshwater fraction left, nearly 70% is held as polar ice or glaciers. A further 30% is found in groundwater or deep aquifers. Only one per cent is readily available in lakes or rivers.

Amazing statistics surrounding Siberia’s Lake Baikal make the situation stranger still. Baikal, the world’s largest freshwater body by volume, holds roughly 20% of the world’s unfrozen surface fresh water. It contains 23,615.39 km3 (5,700 cubic miles) of fresh water, more than the North American Great Lakes put together. As the world’s deepest lake, its maximum depth is 1,642 metres!




By Thameenah Razeek | Published: 2:00 AM Feb 27 2021

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