look news india
Mumbai: A report by Moody's Ratings said that water shortages in the country could have a negative impact on the country's overall credit strength. As a result of widespread consumption, rapid economic growth and frequent natural disasters, water shortages are becoming severe. A reduction in water supply could affect agricultural and industrial activities.
Millions of people across the country face water shortages during summers when water consumption in agriculture, housing and industries increases, but this year, cities like Delhi and Bengaluru are facing water shortages as a result of the prolonged heat.
This could lead to a negative outlook on India's sovereign credit rating, the rating agency report said, adding that it could also pose a threat to coal-fired power generation units and steel production units that have high water consumption.
Investment in water infrastructure can mitigate the risk of potential water shortages. The average annual per capita availability of water in India was 1486 cubic metres in 2021 and is expected to further decline to 1367 cubic metres by 2031. A level below 1700 cubic metres is considered water stressed, while a level below 1000 cubic metres is termed as water scarcity.
Moody's said a reduction in water supply could impact agricultural and industrial operations, which could lead to increased food inflation and is likely to impact business in related industries.
Such a situation can lead to instability in the overall development of the country. The report also warns that the impact of climate change can worsen the situation as India is becoming increasingly dependent on monsoon for its water needs. Competition for water will increase due to industrialisation and urbanisation.