Oil and Water do Mix

There are two commodities, which are going to be scarce in the coming years
and decades. The first one is oil and the second is water. Both commodities
were quite common, quite cheap and quite easily extracted and provided to
the consumers. In both cases, increase in the price causes huge pains and
even louder bellows. Both are considered essential for human life and their
increased usage is considered to be a sign of advanced human development or
civilisation. Both are difficult to store and in certain cases - expensive
to process and deliver to the ultimate consumer. In many cases, both are
present where they are not needed and not present where they are needed,
thereby requiring long and convoluted supply chains. However, the
trajectories that both have followed with respect to human development are
significantly different but will come together in one place, foreign policy.
How so?

While oil is a relatively recent entrant to the realms of human development,
we have had water with us since the year dot. Life began in water and we
cannot imagine a life without water, actually, you cannot imagine modern
life without oil either. Still, generally over the centuries, water was
available almost on tap, so to say. In other words, the pressure on water
was not that much. Human civilisation grew next to water, on lakesides, on
riversides and on sea/ocean sides. It was vital to provide water for a
successful civilisation, and when water was not available, the civilisation
evaporated. One of the oldest examples is that of the Mohenjodaro and
Harrapan civilisation in Pakistan/India where it is thought that loss of
water resources lead to the extinction of this civilisation, the Mayan
civilisation in the Yucatan peninsula is also thought to have collapsed due
to a prolonged drought; and similar instances in Mesopotamia and the ancient
Aksum civilisation in Ethiopia.

Water is heading for a crash if not already. Currently, one can identify the
following places, where the world is in warm or hot water (Oh! Come on, you
know this topic is simply screaming out for some real groaners of puns).

. The Jordan River system and the West Bank aquifers; Israel, Jordan,
Palestine Authority, Lebanon and Syria are all eyeing the underwater
aquifers and the Jordan River hungrily. (Or should it be thirstily?) There
is far too much evidence that the Israeli settlements and Israel’s
geopolitical manoeuvrings are driven partially by a desire to control water
and support its bludgeoning agricultural sector.
. The Nile - Egypt downstream, Sudan, Ethiopia and even Uganda upstream are
heading towards problems. Egypt has threatened wars with Sudan before and
there is definite tension between the other countries over the Nile. Each of
these countries is seriously dependent on the Nile. While Sudan, Ethiopia
and Uganda have not made any serious attempts to harness Nile water, it is
simply a matter of time until they do, if only for economic development. As
soon as they do, this will blow up. (See the Okavango River example below.)
. The Indus river system (and associated rivers in Kashmir) between Indian
and Pakistan. While the World Bank managed to impose a treaty on India and
Pakistan, which surprisingly is still working, there have been far too many
spats over water. Given how the water scarcity is rapidly approaching both
India and Pakistan, I would not be surprised if this becomes a flashpoint
sooner rather than later.
. The Ganges / Padma river system between India and Bangladesh: One of the
perennial low level flash points between the two countries - whether we are
talking about building barrages or releasing water or pollution or flooding
or what have you, Bangladesh and India are almost constantly at a low level
sniping over this river.
. The Brahmaputra / Jamuna / Tsangpo in India / Bangladesh / China: A
similar situation here, but more related to flood control aspects.
. The Tigris-Euphrates system, Turkey upstream, Iraq and Syria downstream:
Now this is a major headache, with Turkey gobbing on to major water
elements, which causes big angst behind the Syrian and Iraqi border. In
addition, this is not a low-level fight, but does escalate strongly into
sabre rattling.
. The North African Littoral which Libya is mining and causing alarm in
Algeria: The good colonel has decided to put gigantic water pipes from south
of the country to the north to bring water from deep underground aquifers to
help in agriculture and other industries. This large aquifer spans Algeria
and Tunisia as well and they are getting nervous about the huge diminution
of their underground water resources.
. Okavango River and the war of words between Botswana and Namibia. Botswana
is extremely dependent on the Okavango River to provide water for it’s
admittedly well run economy. The problem is that the river rises in Namibia
and Namibia wants water for its own purposes. Given the lack of a formal
agreement over water sharing, this frequently leads to tensions.
. Internal issues and less frightful issues are seen in South India, between
USA and Mexico, the Danube river basin, etc. An estimate is that 50% of the
world’s approximately 500 odd rivers are seriously depleted or polluted.

As I was saying, because we never saw water as a commodity before, it has
always been a free good. And you know what they say about a free good,
nobody wants to pay for it. When nobody pays for it, then nobody takes care
of it either. The lack of a pricing and market management mechanism for
water shows up strongly all over the world. If nothing else, this is
something which the oil industry can show to the water industry. Yes, you
need more water than oil, but the concept still remains. You need
functioning markets backed up by suitable government regulations to properly
manage essential commodities. In the same vein, you will need something akin
to this for water.

Strangely enough, several things came together while I was writing this. The
UN World Water Forum was held in Mexico City recently where people are
starting to raise their voices about the water issue (just as an aside, I
counted 24 separate agencies who contributed to the Water Development
Report- I suppose it was inevitable, the bureaucracy has taken over - it’s
easier to arrange for an international conference on water management than
to arrange for a rain water harvesting scheme in Kenya). Second,
India/Pakistan are doing their interminable moan about some water management
structure or other. Third was a hosepipe ban in South East England and
finally, I met with an old friend of mine, Barun Mitra, who runs an NGO
(http://www.libertyindia.org), who brought me an excellent book published by
the International Policy Press, London, edited by Kendra Okonski in 2006,
entitled "The Water Revolution - Practical Solutions to Water Scarcity".

This is not a theoretical book, but contains case studies from various
countries on how water is being managed through a variety of channels. The
contributors have evaluated how government and public sector provisioning of
water has, by and large, failed to fulfil all the requirements of a good
water system. As is usual, whenever states fail to provide services, the
private sector steps in. The contributors talk about how private sector
provisions have formed a complementary structure to the public sector in
Chile, Ecuador, India, China, urban Africa and Scotland. This is a very
interesting book and provides very good examples of how this scarce resource
can be managed.

There is another reason why I am comparing water with oil. Oil has, in some
shape or form, been influencing foreign and military policy for the past
many decades. Whether we are talking about Hitler’s decisions to go after
the oil fields in Rumania and South Russia, to Saddam Hussein’s decision to
go after Kuwait, to the Iran-Pakistan-India pipeline, USA/UK propping up
many a dictator or despot to survive for cheap oil purposes, to Saudi
Arabia’s cheap oil, to China and India’s oil low key all led diplomacy and
foreign policy across the world. Oil has been influencing foreign and
military policy. The exploration for oil has led to significant
environmental issues across the world. Oil has been used as a weapon by the
Arab states in 1973. East Timor got attention because of its oil. And so on
and so forth. All because the world wants cheap and economical oil. Foreign
policy based upon oil may be pragmatic and driven by national self interest,
but the thought of foreign policy driven by BOTH water and oil is worrying.
We are seeing the beginning of this trend between India and Pakistan and my
belief is that this will keep on happening more and more as time goes on.

Well, it’s the same with water, that’s what the world wants - cheap, pure,
clean water, and if there is something we can learn from the mistakes that
the oil phenomena did, then we should apply them to water as well. Because
in few decades time, if we have the same issues with water as we have with
oil, then I am moving to Mars. One can do worse than reading the UN report
(it is a bit turgid, I have to admit and the executive summary is worse than
useless, but here you go, you can find it here
(http://wvlc.uwaterloo.ca/wwdr.htm) but more importantly, the book which I
mentioned gives rise to some very pragmatic ideas of water management.
Here’s hoping that oil and water do not really mix, because the thought of
foreign policy driven by both commodities will complicate international
relations for years and decades to come.