Institutional and regulatory arrangement for bulk water tariff system in Maharashtra state, India

Introduction: Water pricing is also helpful for regulating water use and ensuring efficiency of the irrigation system and its management. As per the constitution of India, water is a state subject. Constitution does not explicitly recognize the right to water as a basic human right. However, this right is recognized implicitly with the Supreme Court’s interpretations of the Article 21 of the Constitution, as right to life with dignity. Maharashtra is the second highest populated, third largest in area, second urbanized and most industrialized state in India.
Materials and Methods: Maharashtra State occupies the western and central part of the country and has geographical area of 307.58 Lakh ha, which includes gross cropped area of 231.75 lakh ha. Maharashtra State is mainly covered by the six river basins and has 126 billion cubic meters of average annual renewable surface and groundwater resources. Integrated State Water Plan (ISWP) for all of the major river basins has been prepared for sustainable development and judicious use of State’s scarce water resources, both surface and groundwater. Maharashtra has 87 major, 297 medium and 3519 irrigation minor projects in the water sector of the State, creating the live storage capacity of 43.8 billion cubic meters (BCM). Maharashtra is a pioneer state in India to have Water Resources Regulatory Act (2005) and established Maharashtra Water Resources Regulatory Authority (MWRRA) to regulate water resource; facilitate and ensure judicious equitable and sustainable management; allocation and utilization of water resources as well as to fix the rates for use of water for all of the purposes and matter connected therewith and incidental thereto.
Results: MWRRA fixes the rates for use of water for agriculture, industries, domestic and other purposes in such a way that the water charges shall reflect the recovery of full cost of irrigation management, administration and maintenance of water resource project (O & M Cost). In this paper, an attempt is made to study the mechanism followed by MWRRA for determination of bulk water rates for agriculture, domestic and industrial users. Water resource has both characteristics of social good as well as economic good. Therefore, pure market mechanism fails to determine the water rates for irrigation. MWRRA has used the modified form of Contingent Valuation Method for determination of water rates for different uses and developed bulk water tariff system in the State of Maharashtra (India). MWRRA, after due consideration of comments and suggestion received from the various line departments, field officers, experts, non-government organizations, water users’ associations (WUAs), beneficiaries, etc., has finalized the bulk water tariff for various water users for the period 2018-20. There are the incentives for using drip irrigation and for WUAs and also for treating of municipal sewage water and its reuse. The authority has been using the tariff as a tool to enforce the measures towards prevention of pollution of the natural streams and water bodies. The MWRRA, through consultations with experts and stakeholders had evolved the criteria for sharing of estimated O & M cost of water resource project among the three main water use sectors as domestic (22%), industry (59%) and agriculture (19%).
Conclusions: Transparency and consultations with the stakeholders for seeking their views and experiences was the integral part of the entire process of bulk water tariff system. In order to meet equity, efficiency and economic principles, bulk water rates are based on volumetric. For enhancing water use efficiency (WUE) in agriculture, 25 percent concessions in water rates are given for adoption of micro irrigation. For promoting the participatory irrigation water management, 25 percent concessions in water rates are given to WUAs. For promoting recycling and reuse of water, 25 percent concessions in water rates are given to users who reduce the freshwater consumption to 75 percent of entitlement by way of recycling. 25 Percent concessions in water rates are given for agro-based industries. In order to bring the discipline and responsibilities in the water sector, the authority has made several penal and ancillary provisions in the water tariff system. Such as, penalty at the rate of 10% per year for delayed payment; water used without signing the agreement, will be charged at 2 times the applicable rate, absence of meter or if the meter found to be non-working shall be levied at 1.5 times the applicable rate.