Trading in virtual water

A study highlights the need to scale down the export of rice, maize, buffalo meat and other items to conserve groundwater in India.

A farmer uses a hosepipe to irrigate crops at her farm in Nilgiris mountains, Tamil Nadu (Image: Hamish John Appleby for IWMI, Flickr Commons, CC BY-NC-ND 2.0)

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Updated on:

13 Dec 2019, 3:42 am

3 min read

The recent trade war between the United States and China was, among other things, about virtual water - the hidden water in products. Producing anything, whether it is soyabean or clothes, uses water, and has a water footprint. Even after production, shipping and trading also have a hidden water cost. Virtual water trade refers to the import and export of hidden water in the form of products such as crops, textiles, machinery and livestock — all of which require water for their production.

The trade war between the US and China since July 2018 and the imposition of tariffs led to a change in the water balance between the two countries. China continues high exports of hidden water in crops, textiles, machinery and livestock. China further stopped importing soyabean from the US in November 2018, leading to American farmers suffer in US$1.8 billion in losses. This also translated to 5.08 billion cubic metres of virtual water not received by China.

Historically, India has been a net exporter of virtual water

Owing to its sizable agricultural exports, India has been losing water thereby putting its water sustainability at risk. In a recent study, researchers from Anna University, Chennai, quantified the volume of virtual water trade in India. The study by K S Sree Vidhya and L Elango published in the journal Groundwater for Sustainable Development, focussed on the trade exchange of popular crop and livestock products by India between 2006 and 2016. The study is funded by the Department of Science and Technology and can help policymakers and water managers in the country develop an efficient conservation strategy for available water resources by strictly monitoring the virtual water trade of the products being exchanged.

The researchers used data on the imports and exports of 16 food and livestock produce from agencies like Food and Agricultural Organisation (FAO), Directorate General of Commerce Intelligence and Statistics (DGCIS), Agricultural and Processed Food Products Export Development Authority (APEDA), Tea Board of India, Coffee Board of India, Rubber Board and Department of Food and Public Distribution (DFPD).

and found that India exported 26,000 million litres of virtual water on an average every year.

Rice was the highest exported food product, followed by buffalo meat and maize. In India, farmers rely heavily on groundwater for rice cultivation, and a kilogram of paddy requires about 15,000 litres of water to grow. Since the country is also one of the top producers and exporters of beef, the virtual water necessary for producing one kilogram of buffalo meat was 5 to 20 times higher than that needed for agricultural production. The imported products with the highest virtual water content were cashew, followed by pulses and wheat. These crops demand less water for their production than rice.

In the ten years studied, India exported virtual water amounting to 496.98 trillion litres and imported 237.21 trillion litres. The researchers observed an increasing trend for exports of tea, coffee, rice, pulses, cashews, walnuts, raw sugar, grapes and buffalo meat and a decreasing trend for imports of products like tea, coffee, rice, wheat, groundnut, raw sugar and sheep/goat meat. However, the import of cashews, walnuts, grapes, onions, pulses, maize, alcoholic beverages and natural rubber increased over the past decade.

The study provides some insights to devise strategies to manage groundwater sustainably, as 80% of our agricultural activities are dependent on groundwater. In 2014–15, India exported 37.1 lakh tonnes of basmati rice for which 10 trillion litres of water was used — from land preparation to post-harvest processing. Almost one-fifth of this water came from surface water and groundwater, adding to the burden on domestic availability.

Although food production needs to match the growing population, looking at water-efficient varieties of crops is the way forward, according to the researchers. Exporting food and livestock products that are produced using water-efficient methods could bring down the net virtual water export for the country, they argue.

The study also provides some pointers on how farmers could save water while growing crops. Effective irrigation techniques, irrigation scheduling, suitable crop selection based on climatic conditions, soil type and water availability, and using alternative sources of water for irrigation could help reduce groundwater consumption. Judicious mixing and growing of different crops with lower water demand at the national level need to be taken up. In the year 2019 alone, agriculture exports generated a revenue of 1.29 lakh crore for India — a sizeable share. However, these exports need to be monitored for sustainability, factoring in the effects of climate change.