Trading In Water

VIRTUALLY since the dawn of human civilization, the total amount of fresh water available for human consumption and use has practically remained constant. It is just half a per cent of the total water on the planet—the rest being seawater or water locked up in ice caps or deep below the earth’s surface. In the last 200 years the earth’s population has risen over 33 times. On the other hand, the only renewable source of freshwater on earth is rainfall—which generates a more or less constant global supply of 40,000 to 45,000 cubic km per year. Moreover, overuse, pollution, diversion and depletion of this finite source of freshwater is taking place rapidly across the globe. It is being predicted that by 2025 the demand for fresh water will rise by over 56 per cent. Clearly fresh water is becoming a scarce commodity. The United Nations estimates that one billion people already lack access to fresh drinking water, and within the next 25 years, the number of countries facing chronic water shortages will rise to 50, affecting about 35 per cent of the world’s population.


It is not as if the increasing population has access, or is using equally, this finite resource. The United Nations reports that Europeans spend 11 billion dollars a year on ice cream (made mostly of water), 2 billion dollars more than the estimated total money needed to provide clean water and sanitation for the world’s population. More than five million people, most of them children, die every year from illnesses caused by drinking water that is unfit for human consumption. While billions, mostly in developing nations like India, go without clean water, North Americans use about 5000 liters of water per person per day!

Unequal access to water exists within nations too. The ongoing unprecedented drought in India is affecting millions of humans and cattle, and is leading to famine like conditions and large-scale migration. The drought of the year 2001 affected the entire central belt, from East to West. Rivers and wells ran dry and over pumping has either emptied ground water or pushed the source deeper down. Side by side water sport amusement parks are seen to sprout in all big cities and highways of the country.

Of the total quantum of water used by humans, 65 per cent is utilised for agricultural activities, 25 per cent by industry, and 10 per cent by households and municipalities. The world’s expanding cities and industries are taking more and more water from agriculture every year. Export oriented agribusiness is claiming more and more of the water once used by small farmers for food self-sufficiency. While advances in modern engineering have allowed governments to supply farms and cities with water and hydel power, it has also accentuated the disparities in access to water.


True to its character, this looming crisis is sought to be utilised by global capital for its own interests. Trade in water has, in recent years, become an extremely profitable business. As demand for fresh water continues to grow, more and more corporations and governments are joining the race to commodify water. In industries ranging from wastewater services to bottled water to bulk water exporting, corporations are gearing up to exploit water shortages all over the world.

Two French multinational corporations dominate the world of privatized water — Vivendi SA, (whose water division is Generale des Eaux) and Suez Lyonnaise des Eaux (which built the Suez Canal and has holdings of over 56 billion dollars). They are often referred to as the General Motors and Ford Company of the water world. Between them, they own or have controlling interests in water companies spanning 120 countries on five continents. They distribute water to almost 100 million people in the world. In March 1999, Vivendi purchased US Filter Corporation for more than 6 billion dollars, making it the world’s largest water company in North America with projected annual revenues of 12 billion dollars. With close to 90 billion dollars in annual revenues, the US is the world’s largest water market. Until now small scale public-sector operators have almost exclusively controlled this sector. Vivendi is poised to promote the massive privatization of the American water market.

Corporations have suddenly discovered the potential of the water market. The World Bank places the value of the global water market at close to 800 billion dollars. The power giant Enron (very familiar to people in India!) has acquired Wessex Water PLC of Britain and is bidding for huge contracts for newly privatised water services in Bulgaria, Rio de Janeiro, Berlin and Panama.


A form of privatized water, familiar even in developing countries like India, is bottled drinking water. The inability of municipal bodies, throttled with financial cuts, to supply quality drinking water has opened up a huge private market for drinking water. In India, for example, bottled water sells at rates higher than that of milk! So, enter private packaged suppliers. Bisleri, Triputi, Ganga, etc have become familiar brands that dot not only the big cities but deep in the countryside. Recently, the two multinational soft drink giants—Coke and Pepsi—have entered the bottled water market. Parle, which owns Bisleri, is negotiating a deal to sell its brand to a French multinational.

Worldwide, trade in bottled water is one of the fastest growing, and least regulated. In the 1970s, the annual volume was around 9,000 million litres. By 1980 this figure had reached around 19,000 million litres and by the end of the decade, the world was drinking around 6 billion litres of bottled water each year. In 1998 over 18 billion liters of water was bottled and traded globally—over 90 per cent of it in non-renewable plastic containers. As the world’s freshwater supply becomes increasingly degraded, those who can afford it are turning to bottled water, even though bottled water is subject to less rigorous testing and purity standards than tap water. A March 1999 study by the US based Natural Resources Defense Council (NRDC) found that much of bottled water is less safe than tap water. One third of 103 brands of bottled water studied contained levels of contamination, including traces of arsenic and disease causing bacteria. The study also found that at least one fourth of bottled water sold in the market is actually bottled tap water. Similar studies in India have come up with very similar findings. Yet the market for this water continues to make rapid strides.

As mentioned earlier the soft drink giants are now entering the bottled water market to challenge the supremacy of established global brands like Perier and Evian. Pepsi has its Aquafina line and Coca-Cola has recently launched the North American version of its international label, Bon Aqua, called Dasani. Coca Cola predicts that its water line will surpass its soft-drink line within a decade! These companies are engaged in a constant search for new supplies. They ship water in containers from distant sources, often purchasing water rights from farmers. In rural communities all over the world, corporate interests are buying up farmland to access wells and then moving on when supplies are depleted.


Bottled water is however a very small component of the global trade in water which involves the mass export of bulk water by diversion (of water bodies) and in sealed bags and supertankers. Barges already deliver water to the islands in Bahamas, and tankers deliver water to Japan, Taiwan and Korea. A Turkey government water company had begun work to divert water from the Manavgat River, to be shipped across the Mediterranean to Cyprus, Malta, Libya, Israel, Greece and Egypt, until political tensions halted the project. The European Commission is looking into the possibility of establishing a European Water Network so that alpine water from Austria can flow into Spain or Greece, rather than into Vienna’s reservoirs. A high-tech pipeline already transports spring water from the Austrian Alps to Vienna, and there are proposals to extend it to other countries. In Canada, a permit granted in 1999 to the Nova Company to ship tankers of Lake Superior water to Asia was abandoned after a major public outcry.

Several companies around the world are developing technologies to make it possible to load large quantities of fresh water into huge sealed bags, to be towed across oceans for sale. The Nordic Water Supply Company in Oslo has signed a contract to deliver 7 million cubic meters of water per year to Northern Cyprus. Aquaris Water Trading and Transportation Ltd. of England has begun the first commercial deliveries of fresh water by bag to the Greek Islands. But it is in North America that companies are lining up in large numbers to trade in water. Several are directly involved with plans to divert massive amounts of Canadian water to water-scarce areas of the United States, Asia and the Middle East by tankers, pipeline, or rerouting of natural river systems.

The day, evidently, is not far off when the fresh water resources of developing countries like India will be predated upon. While the developing countries offer a large market for fresh water, they also contain some of the largest reservoirs of this same water. Regions like the Himalayas and its river and lake system—stretching through Pakistan, India, Nepal, China and Bangladesh—provides a vital source for fresh water mining. The consequent ecological damage could threaten the most populated region of the world.

(Much of the material in this article has been taken from a note prepared by Dr Vinod Raina for the All India Peoples Science Network.)