Global Rice News

Pakistan’s Water Crisis: Addressing the Neglected Challenge

Political instability, economic uncertainty, and climate shocks have dominated the policy agenda in Pakistan, leaving one long-term challenge overlooked – the country’s water crisis. Unequal access to clean water is deepening socioeconomic disparities and has the potential to escalate civil unrest amid macroeconomic instability. Aging infrastructure, weak water governance, and the unpredictable impact of climate shocks compound the issue, making water security a significant threat to the state and society.

Reforms to address the structural flaws in the political economy perpetuating water insecurity have been hindered by elite interests tied to water-intensive agriculture. Additionally, uncertain political timelines and a lack of policy continuity between governments complicate reform efforts. International lenders have also failed to prioritize water security in their assistance to Pakistan over the years. Consequently, existing agricultural policies maintain the status quo by borrowing economic and water resources from both current and future generations.

The current domestic and international landscape presents an opportunity to tackle these persistent challenges. As the impacts of climate change become increasingly evident throughout the country, water insecurity is likely to gain more political salience. At the same time, international financial institutions and foreign investors are demanding policy changes and greater accountability.

Pakistani Water Crisis

Despite having ample water resources, millions of Pakistanis still face water insecurity. The World Health Organization recommends a daily water supply of 50 to 100 liters per person for a dignified life. Pakistan’s population requires between 3.5 and 7 million acre-feet of water annually to meet its domestic demand, but the country’s total annual water availability is around 193 million acre-feet.

Pakistan’s water crisis is not solely due to water scarcity but is rooted in equity, access, and intersectoral distribution. An insufficient supply of clean water directly or indirectly contributes to 40% of annual excess deaths in Pakistan. Less than 40% of households in Karachi, the seventh most populous city globally, have access to piped water. Drought conditions persist in rural Balochistan and Sindh, leading to increased rural-urban migration. On the other hand, the country has witnessed a surge in water-intensive urban beautification and horticulture projects linked to upscale private housing societies.

The cultivation of water-intensive crops in Pakistan consumes a significant portion of the available water. Approximately 23% of water is used for wheat, 21% for rice, 19% for sugar cane, and 14% for cotton. Existing policies support water-intensive crop cultivation by not incorporating water costs into agricultural production. For instance, under the Canal and Drainage Act (1873), consumers of canal irrigation pay a flat fee for unlimited water use, while households in Karachi pay significantly more for a standard water-tanker service.

Agricultural Reform for Water Security

Agricultural reforms should consider the importance of individual crops. While rice and wheat are essential food staples, the cash-crop sector, particularly sugar and cotton, consumes a significant portion of water resources. Sugar cane alone accounts for about 42% of Pakistan’s total annual household water demand.

Reforms in the sugar sector face challenges due to the influential role of sugar barons who financially support political parties. However, initiating reforms in the cotton sector could minimize political resistance. Cotton is a nonessential, water-intensive cash crop that can be gradually phased out in favor of alternative crops more sustainable for long-term water security. Export diversification plays a crucial role in reducing reliance on cotton-based goods and increasing the value of Pakistan’s exports.

Pakistan is the largest exporter of virtual groundwater in the world due to its water-intensive cotton exports. Each year, the country exports around 13 million acre-feet of its total water supply through cotton-based textiles. Reining in cotton production poses challenges due to its significant contribution to total exports and foreign exchange reserves. However, encouraging export diversification in sectors such as high-value goods, services, and information technology can reduce stress on water resources and generate more foreign exchange reserves.

Navigating Challenges

Implementing agricultural reforms faces several hurdles, including pressure on foreign exchange reserves, impacts on food security, elite interests, and farmers’ livelihoods. However, these challenges can be overcome through a phased approach to specific cash-crop reforms.

Addressing the challenge of foreign exchange reserves involves focusing on export diversification. Cotton-based exports offer limited solutions to long-term economic and water security. On the other hand, the services sector has shown growth in export quality, making it a potential source of foreign exchange reserves.

Differentiating between essential and nonessential water-intensive crops is crucial. Cash crops like sugar and cotton do not significantly impact food security and can be substituted with alternative crops through export diversification strategies.

Export diversification incentives should be introduced to minimize resistance from elite interests. By initiating reforms in the cotton sector while implementing export diversification measures, policymakers can gradually phase out water-intensive crops and generate more foreign exchange reserves.

The impact of reforms on subsistence farming and corporate farming should be distinguished. Mechanized sectors like cotton require relatively fewer labor inputs, meaning reforms have a lesser impact on small-scale subsistence farmers. Cash transfers, coupled with land grants and training programs, can mitigate short-term losses for farmers shifting away from cash crops and encourage them to grow alternative crops.

Looking Ahead

Policymakers in Pakistan have been deterred from implementing structural reforms due to uncertain political timelines and a reliance on international economic assistance. However, the international community can incentivize agricultural sector reforms by guiding investment toward sustainable practices and rewarding progress with additional support.

International financial institutions should prioritize water security in their policies and support countries like Pakistan in adopting water-conscious practices. Voluntary reallocation of IMF Special Drawing Rights (SDRs) in response to the COVID-19 pandemic provides an opportunity for positive change. The United Nations and the World Bank can allocate SDRs based on countries’ progress in achieving water-related Sustainable Development Goals, encouraging Pakistan to implement essential policy changes.

Addressing Pakistan’s water crisis is crucial for mitigating existing challenges and avoiding further instability. By prioritizing the public’s access to water resources and gradually implementing agricultural reforms, Pakistan can achieve long-term water sustainability and economic growth.

Source: Stimson Center