Economics of poor water-sense
Looming water shortage in the country has led to calls for conservation from all quarters. Agriculture with its 90 percent consumption is the primary user of Pakistan’s total freshwater resources; hence, the sector has been rightly chided for inefficient irrigation practices and a need to rethink cropping patterns based on crop value and water requirement (see “Water conservation: a win-win for agriculture?”, published in these pages on August 20, 2018).
However, if specter of water scarcity is not enough of an incentive to effect efficiency in irrigation methods, farming economy may be willing to consider the higher crop yield that shall accompany lower water use. Reportedly, overuse of water is more harmful to crop yield than pest attacks.
So why do local farmer over-water their fields when it is so obviously against their self-interest? While lack of technical knowledge may be one reason, farmers too are rational economic players, regardless of education background. Moreover, lack of formal training becomes less significant as farming communities retain institutional memory in the form of years of shared experience.
Anecdotal evidence suggests that fear is the primary driver behind overuse: scared of running out of water supply before cultivation period ends, farmers tend to overuse water even as they are fully aware of lower productivity risk. This is especially significant for fields dependent on shared canals where farmers wait their turns for supply. However, afraid of power outages and increase in fuel price, farmers relying on tube wells to abstract groundwater are also faced with a similar predicament. Irregular precipitation pattern is another driver as farmers prefer lower yield from over watering than zero yield in case of no rain.
Thus, a pattern of loss aversion is observed in farming community as they choose to cultivate low risk cereal cash crops such as sugarcane, wheat and maize to high yield crops such as vegetables, oilseeds and in recent years, even cotton. This appears to be a rational response to asymmetry of information regarding weather patterns and water availability.
While this is only one of the several bottlenecks in agricultural value chain, it is not one without a solution. Efficient irrigation requires that farmers be able to monitor soil moisture content continuously. To this end, Nestle Pakistan has helped locally develop smart soil moisture sensors that measure the water level of soil by regularly sending data to a cloud based server. Farmers are meant to receive uninterrupted information about how much and which area to irrigate, allowing them to keep the farm from under or over irrigation.
According to a news report from last year, Nestle plans to make these available in the market for as low as ten thousand rupees. Skeptics may be weary of what they call a ‘nice PR gimmick’ by a large MNC, water conservation makes good economic sense for a business deeply concerned about future of country’s water supply, literally a raw material for one of its high-value contributing flagship brands.
Rarely have corporate and small farmer’s interest aligned so well, even if for a very short-term. Farmers should jump at the opportunity and reap the benefits. What is the downside?
