Trading on Water

In ancient times, selling water was considered a nefarious activity. Water is essential for life. Most of the cities were built on the banks of rivers or water reservoirs. Early civilisations were born and lost on account of water.

But we have seen how water has taken a shape of industry and trading that started with mineral water bottles. Now water tankers have become the order of the day. Water is now freely sold, especially in water-deficient areas.

Water is now new oil or a liquid gold. Yes, it’s really surprising that water has joined oil and gold as a commodity in the futures market on the Wall Street. Water is now being officially traded in futures market. The US firm, CME group has launched contracts for California spot water, which is estimated to be worth $ 1.1 billion @486.5$ per acre foot.

A futures market is basically an auction market, where commodities are bought and sold today for delivery on a specified future date.

Futures are exchange traded derivatives contracts that lock in future delivery of a commodity at a price fixed today. For example, a farmer can use futures to lock in a specific price for selling his crop to reduce the price fluctuation risk and get a guaranteed price.

It’s being said that the future trading of water will clear uncertainties around its prices and help people plan the budget efficiently, but the ethical question remains whether it’s justifiable to make water a tradable commodity and allow investors to bet on suffering of others.

One may also question whether the basic human needs like water should be brought under the mercy and control of financial institutions. But commodities like grains, pulses, oil, gas etc are already being traded. Water will be just one more addition.

The moot point is, ” the future holds this for us.” Climate change, natural calamities like drought and wildfire, increased human consumption and wastages have aggravated the problem. Two third of the world is estimated to face water shortage by 2025.

California development is just one more writing on the wall, but we tend to ignore such writings time and again.

Back in India, a major portion of population doesn’t have a reliable and constant means of getting water for daily needs. More than 65% of reservoirs are below-normal water levels and 12% are completely dry.

When I was posted in Bundelkhand region of MP, I had seen the hardships of farmers, households, businesses, and especially ladies in remote rural areas, who used to walk miles just for a pitcher of water or two. I have seen how ladies and children used to get inside drying wells to take whatever water was available at the bottom.

Instead of feeling the pinch, even now we can and should ensure efficient use of water for agriculture and households, restrict release of chemicals and effluents into rivers etc, use rain water harvesting and stop leakages and wastages.

The Waterman of India, Shri Rajendra Singh, a winner of Ramon Magsaysay Award for his pioneering work in community-based efforts in water harvesting and management. Let him continue to bring water to villages and restore soils and rivers. Let’s do our own.

There will not be a Waterman everywhere. Let’s become watermen, beginning with households, offices and business installations for our own good and future, following the footsteps of Shri Rajendra Singh, whose motto of life is-
Water is my life,
my happiness,
my teacher.

–Kaushal Kishore

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