Not just power but water too is set to become a regulated commodity in Gujarat, with the state planning to set up a water regulatory commission shortly. With this move, the government hopes to minimise the mismanagement of its water resources as well as rationalise costs

Gujarat is set to become the second state in India, after neighbouring Maharashtra, to have a regulatory body for its water sector. The Gujarat state government has readied a draft Bill on a water regulatory commission to ensure planned growth in the sector, promote water conservation and rationalise water supply tariffs and transport subsidy policies. Increased privatisation of water resources in the state is also a likely outcome of the Bill.

The Gujarat Water Regulatory Commission (GWRC) Bill, 2006, drafted with the help of The Energy and Resources Institute (TERI), the Delhi-based sustainable energy group, will soon be presented to the state cabinet for its approval.

Officials claim the regulatory framework will bring clarity to the roles of various government bodies involved in water distribution, boost private sector investment, improve productivity and efficiency in the sector, and also address the cost aspects. Aiming at an economic costing of water, the Bill includes municipal bodies and industrial users in its ambit.

"As things stand today, there is an overlap of functions, the concept of user charges is missing, and there is no check on exploitation of water resources. The commission will be an umbrella body dealing with such issues," a top official said.

A three-member expert body, the commission will comprise individuals who have excelled in the fields of engineering, municipal management and finance.

Apart from the commission, the Bill also provides for the setting up of a State Water Regulatory Council (chaired by the chief minister, with 10 other ministers as members) and a State Water Regulatory Committee (chaired by the chief secretary, with 13 other secretaries).

While the council will lay down the broad water management policy, the committee will assist the council in the discharge of its functions, including formulating an Integrated State Water Master Plan.

The draft Bill also has provision for a 15-member consultative committee drawn from local bodies, academia, industry, the agriculture and labour sectors, CSOs and research bodies to advise the GWRC on policy and tariffs, and to protect the interests of consumers.

While no time limit has been set for the formation of the commission, it will need to be in place within six months of the Bill becoming a law.

Commenting on the proposed regulatory agency, Y K Alagh, former Union power minister, said: "It's a welcome step. Given the water scarcity that we are likely to face, only public-private partnerships can bring investments, and you need a regulator to manage that." But, he added, "It will be a useful idea only if the commission is provided with adequate autonomy and the tariff is based on long-range marginal costs (LRMC). Also, if the government means business it should keep political and bureaucratic bodies out of it."

Source: Express Newsline, September 13, 2006