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Tackling water issues with innovation

By Leong Ching and Qian Jiwei (China Daily) Updated: 2011-05-17 07:57

At the start of the year, after having weathered some devastating floods and droughts, China focused its attention on water governance. Investment in water infrastructure and management is now one of the most important commitments of the central government, which is reflected in its No 1 document this year. The document says 4 trillion yuan ($614 billion) will be invested in water infrastructure projects over the next decade, and the funds will come from central and local governments both.

The amount may appear huge, but some experts say the country needs another 3 trillion yuan, which may take another 10 years to realize.

Water has hogged the headlines in recent times with the drought in Shandong province threatening to be the worst in 200 years. And wheat production is likely to drop causing hardships for millions of people.

In the midst of the water challenge, however, there are success stories. The case of the Inner Mongolia autonomous region teaches us two important lessons:

First, the government does not have to be the only one footing the water bill. A big part of that money can come from the private sector, as long as it gets returns. From 1999 to 2005, the central government invested 32.83 million yuan in water infrastructure projects in Erdos city in Inner Mongolia. But over the next three years, the local government invested 701.84 million yuan in Erdos' two large irrigation areas. On average, the central government invested 5.4 million yuan each year - which means that the local annual investment was nearly 40 times that of the central government.

The local government could do so because it charges industries that want to use water. It transfers the amount then to water infrastructure projects. Officially, this is called "water rights transfer". But in reality, it is an economic price paid by the private sector for doing businesses. So if more money is needed, the government need not be the only one paying it.

Second, money is not all there is to the water story. To make investments count, public support is vital. The government can raise money for large infrastructure projects, and could meet all its short-term investment targets. But water conservancy requires constant vigilance, and infrastructure requires careful husbandry, and both require public support.

Take farmer Liu Gaoqi, 61, for example. He would have stayed home in the heart of Inner Mongolia, playing a game or two of luck, and waited for spring to work his land. But this winter, he watched his plants growing in temperature-controlled tents, and enjoyed the fresh tomatoes from his farms.

The difference, he says, comes from the investment in new high technology farms, which use drip irrigation and controlled temperatures to make sure that farms continue to be productive even in winter in Erdos, where temperatures can plunge to -32 C. "We would have never been able to afford this sort of equipment on our own. It's thanks to this exchange we have with industry," he says.