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Contextualizing Telangana among other Indian states in a privatizing water sector: Learning from patterns of budgetary allocation

With the incoming of reforms in the early 1990s, the discourse of the state with regard to privatization and liberalisation has drastically shifted. Contrary to the understanding in the early years of the reform period, this discourse found its way into the social sector in a significant way. The water sector in particular saw this discourse graduating from the initial “water as a commodity” to the changing role of the government from direct service provider to that of a facilitator. With the population and demand for water increasing on the one hand, and the coverage of safe drinking water being pathetically low, on the other, a fall in the state’s expenditure in the water sector can only make way for the private capital to fill up the enlarging gap between the demand and supply of domestic water, both for the purposes of drinking and other household needs.

Though water consumption for irrigation is as high as 84% of the total water use, two related though well-known aspects need to be considered simultaneously; first, only a third of the cultivated land is irrigated in the country and second, more than a half of the population still depend on agriculture as an source of livelihood, notwithstanding its meagre contribution to the country’s income to the tune of only around 17%. Given this, a reduced importance to irrigation accorded by the Government can only be justified if this translates to an enhanced attention towards safe drinking water, the latter being a basic state responsibility. However, this relationship is not observable from a comparison of the states’ budgetary provisions towards irrigation and water supply. Over the past two and a half decades water sector allocations have fallen as a percentage of total outlay (including developmental and non-developmental expenditure) both for the heads of irrigation, and water supply and sanitation. For the irrigation sector, the allocation to total outlay has fallen from 8.87% in 1990-91 to 4.60% in 2015-16. This decline has been secular, particularly since the eleventh plan. The corresponding budget for water supply (domestic and drinking) and sanitation, declined from around 2.5% in the very early 1990s to close to or below 2% in the last five years.

Telangana’s case represents a welcome contrast compared to the trends noticed in other states. Since its formation in 2014, Telangana has made the water sector a primary focus of its budgetary allocations. The two major programmes adopted by the youngest state of India, Mission Kakatiya, a tank rejuvenation programme, and Mission Bhagiratha, which comes with the promise of providing safe drinking water to all households, irrespective of their location in rural or urban area, are noteworthy. Compared to the budgeted outlay of 2.32% in 2015-16 for all states for water supply and sanitation, which has increased in the last couple of years prompted by the vision of achieving a ‘clean India’ through the Swachh Bharat Mission, the Prime Minister’s favoured flagship programme, the corresponding figure for Telangana is a little over 4%. Even in the irrigation sector this allocation is 10.68% in 2015-16 as against a mere 4.6% in all states. Water supply and sanitation account for 11% of the total social sector expenditure in Telangana, which is far higher than 6.05% in all states in the same year. In the two years since the formation of the state, both rural and urban water supply expenditures have almost doubled, though the expenditure on sewerage and sanitation has declined. Due to the complementary relationship of water supply and sanitation, particularly with respect to public health, this remains a matter of concern for Talangana, the increased provisions for the water supply notwithstanding.

A related issue is that practically all of the increase in the budget in both water supply and irrigation has come from state funds in Telangana since the formation of the state, while all the centrally sponsored schemes have shown a significant decline, though typically the centre’s assistance in a basic service such as this is expected to be high soon after the formation of a new state in what may be considered as a ‘incubation’ period. The fact that majority of the districts in the state figure among those that are worst affected by drought within the country does not appear to make a difference to the centre’s contribution to the state.

A comparison of the case of Telangana to the earlier allocation trend for the water sector in erstwhile Andhra Pradesh reveals a marked departure in the commitment of the new state to boost its irrigation and water supply situation. Before the formation of the new state in 2014-15, Andhra Pradesh allocated only about 0.7% of its outlay on water supply and sanitation, significantly lower than even the corresponding share of 1.8% for all states in the same year. This allocation, as a share of the total social sector expenditure was a mere 2%, compared to the corresponding figure of 5% for all states. On the face of it, a notable factor contributing to the raison d’etre for the formation of the state has been vindicated to a large extent by at least the intent of the government of the new state reflected in the budgetary allocations.

The water sector budgetary allocations of the Telangana government are significant on three counts. A decreasing irrigation expenditure apparently disconnected for the most part from the will to divert the water towards drinking water in most of the other states, actually reflects a shift in the developmental paradigm that promotes urban centric growth at the cost of rural development. However, this, at least in the face of it, is not the case in Telangana, where Mission Kakatiya has been promoted primarily to enhance irrigation capabilities both through increased ground water recharge and an enhancement of surface water availability. Secondly, the emphasis on promoting drinking water availability by the state through Mission Bhagiratha provides the possibility of reducing the currently increasing dependence on priced and private water sources, both for drinking and domestic water needs, particularly in and around the large urban centres. Thirdly, both Missions together, could potentially act as an important cushion for the distress caused, particularly to the marginalized sections of the population, in the face of a changing climate observed in recent years through a three year long intensive drought situation in the state. This is particularly relevant for a drought prone state of Telangana where climatic uncertainties can play havoc with livelihoods, drinking water access and well-being.

The State Action Plan for Climate Change for Telangana identifies key interventions for climate change mitigation and adaptation from a variety of sectors including agriculture, energy, tourism, rural and urban development, health etc. Notably, over a quarter of the total estimated budgetary expenditure for these interventions in the twelfth plan is for the water sector. With climate change emerging as a major issue in recent years, the need for government focus on the water sector has to translate the welfare realm of provision of basic amenities and livelihoods to reduced vulnerability and increased resilience. Given the increased risk and uncertainty in the face of climate change, it is worth asking whether we are willing to trade this larger objective of the water sector with the profit maximising, ‘performance-centred’ objective of privatisation of the water sector. The state of Telangana is a test case, and an assessment of the efficacy of the two water-centred Missions is of utmost relevance to understand whether the public sector thrust in water provisioning would work in the context of a neo-liberal policy environment.

By Sucharita Sen, Shreya Chakraborty


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