Public water, privately bottled profits
Chronicle Editor @ May 20, 2008
Public water, privately bottled profits
By Raja M
Excerpts:
MUMBAI - India's fast-modernizing society, benefiting from economic growth of close to 9% a year, is caught up in a conflict over access to a basic resource - water - that is pitting Coca-Cola and rival bottlers of the stuff against villagers and others who want their activities more tightly regulated.
The country's bottled water industry, part of a US$100 billion global business, has been growing at triple the pace of the economy as a whole. As consumers take advantage of portable potables, residents in drought-prone areas feel their needs are being shunned and officials warn of over-exploitation of ground water resources.
On April 7, more than 1,500 villagers defied a police cordon and marched to Coca-Cola's bottling plant in Mehdiganj village, Varanasi, in Uttar Pradesh state, demanding that the company immediately shut down its bottling plant. In January, the New Delhi-based Energy and Resources Institute (TERI) advised Coca-Cola to shut a bottling plant in the drought-stricken state of Rajasthan.
India's Ministry of Water Resources has ranked 80% of ground water resources in Rajasthan as "over-exploited" and nearly 34% resources as "dark/ critical", the gravest ranking across the country.
Millions of people, both in rural and urban India, suffer from inadequate or no tap water supply. Even parts of the movie-stars' residential area of Juhu in Mumbai, the country's financial capital, get a mere two hours of daily water supply. The city's Virar suburb gets 45 minutes. So bottled water is much in demand by residents - even though the businesses profiting from the sales are thriving from access to public water sources.
Not just bottlers are involved. In south India, thousands of fuel trucks converted to be water carriers sell ground water to households and establishments at about $10 for 5,000 liters. More than 13,000 tankers carry water drawn from farmland surrounding Chennai, according a social activist R Srinivasan. He estimates a $148 million tanker industry is cashing in on Chennai's acute water scarcity. The story is replicated across India, including in New Delhi.
Rising demand for commercial water coincides with plummeting ground-water levels, which dropped by up to eight meters (26 feet) in the first seven years of Coca-Cola's operations in India, from 1999 to 2006, according to India Resource Center, an activist group, citing data from hydrograph monitors of the government's Central Ground Water Board.
Ironically, the 500-page TERI report that urged closure of the Rajasthan bottling plant was commissioned by Coca-Cola in 2006 to study allegations of pesticide residues in its products. TERI found no pesticides in water samples in six bottling plants it studied, but its findings on water stress vindicated water protesters and stunned Coca-Cola executives, who have not contradicted the findings. Of the six Coca-Cola plants surveyed in the study, three are in areas suffering increased stress on groundwater.
An undated statement on the Coca-Cola India website states that the TERI report confirms that the company meets Indian regulations, while acknowledging that the report identified some areas "where we can do better".
"As a result, we are strengthening our plant sitting requirements, our monitoring capabilities for both rainwater harvesting and wastewater treatment and our guidelines for source protection and operating in water scarce areas," the statement said.
The site says Coca-Cola, which reported a 19% jump in global first-quarter net income to $1.5 billion, directly employs about 6,000 people in India and indirectly creates employment for more than 125,000 people. Its Indian operations comprise 25 wholly company-owned bottling operations and another 24 that are franchisee-owned.
Coca-Cola is just one, if the most prominent given its international stature, of thousands of brands in India's $445 million packaged water industry.
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Whatever the price of bottled water, people in India appear willing to pay for the commercial product while turning their backs on the country's ancient methods of cooling and purifying water. Stored in earthen pots, for instance, it is not only refreshingly cool and tasty but is said to become bacteria-free. Yet the common summer sight of water matkas (earthen pots) in public offices and spaces is giving way to upturned plastic drums dispensing packaged water.
But not even a severe water shortage in the national capital has moved the central government to regulate excessive ground water extraction by business corporations.
To the contrary, the state government of Uttar Pradesh arrested 2,000 farmers in the drought-stricken Bundelkhand region in April 6 for "stealing" water from a public canal.
Raja M regularly drinks water from taps in various cities and towns across India, and as yet reports no lethal side effects.
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