The Hindu : Water to become 2.5 times dearer

Online edition of India's National Newspaper
Wednesday, Dec 31, 2003

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Water to become 2.5 times dearer

By Sujay Mehdudia

NEW DELHI DEC. 30. Mounting input costs, costlier raw water, burgeoning wage and power bills and decreasing returns have brought Delhi Jal Board to the brink of bankruptcy. To overcome all these factors and provide a better service to the consumers, the Board is considering an increase in water charges for domestic, industrial and commercial consumer alike. The hike is likely to be announced during the next fortnight after a formal approval by the Delhi Cabinet, according to authoritative sources.

The hike is likely to be around 2.5 times in the case of domestic consumers but much less for industrial and commercial users who are already paying very high charges for water. Although the issue was discussed at the meeting of Delhi Jal Board here today, nothing concrete was decided. The meeting was held under the leadership of the Chief Minister, Sheila Dikshit, at the Players Building. At present, the domestic consumers are paying 35 paise per 1,000 litres. It is learnt that this would be hiked to at least Re. 1 per 1,000 litres.

However, the hike is not going to be very high in the case of the other two categories as they are already paying a high rate of Rs. 16 per 1,000 litres presently. Interestingly, 85 per cent of the water consumption is by the domestic consumers and even a sharp increase for industrial and commercial consumers will not serve any purpose.

Jal Board officials point out that since 1998 the tariff has not been increased while the input costs have risen sharply sending fiscal calculations haywire. It is pointed out that in case of power tariff, the total bill now has touched Rs. 270 crores compared to Rs. 50 crores in 1998. With Delhi Vidyut Board, the Board was able to adjust payments and get away with making small payments However, now original bills have to be paid to the private companies for the power consumed. There has been a rise of Rs. 220 crores in the power bill but the water consumption rates have remained stagnant. Similarly, the cost of getting raw water has increased manifold and all the new projects for getting raw water for Delhi would cost very high in view of the fact that water was being brought from far off places.

On the other hand, the Municipal Corporation of Delhi has slapped the Board with Rs. 200-crore property tax bill. Earlier, when the Board used to be with the Corporation, the total property tax bill hovered around Rs. 10 crores only.

Similarly, the total salary bill of the Board, after the implementation of the Fifth Pay Commission recommendations, had risen sharply to Rs. 240 crores per year. Officials point out that the industrial and commercial users cannot be charged beyond a limit as it would force these consumers to shift their options to using ground water and other sources. A case in point is Northern Railways that paid around Rs. 200 crores annually to the DJB.

However, when the charges were hiked, the Railways stopped taking water from the Board and started tapping the fragile ground water by installing rainy wells. This led to a fall in revenue for the Board and loss of a valuable consumer. "People of Delhi will have to understand that input costs have skyrocketed while the user charges have remained by and large stagnant. This situation cannot go beyond a limit as it would lead the Board on the verge of a collapse,'' remarked a senior official.

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