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Water scarcity a challenge to growth in India, emerging markets

New Delhi : Growth and development in several emerging markets including India, China, Brazil, Russia, Mexico, Indonesia, Nigeria, and Turkey could face complex and inter-connected sustainability challenges from water scarcity, weather exposure, and land tenure disputes, a new report has warned.

Rapidly converging sustainability pressures in developing countries and competition over key resources could trigger far-reaching instability for the global economy.

Some of the local resource risks, like water stress, land-use change, food security and energy instability, in these developing countries could even trigger “political and economic risks" that quickly spread to the global economy, the report - “The Earth Security Index 2015: Managing global resource risks and resilience in the 21st century,” launched recently in London by strategic consulting firm the Earth Security Group, has said.

CEO of the Earth Security Group, Alejandro Litovsky, explained how growth and development in emerging markets – Brazil, Russia, India, China, Mexico, Indonesia, Nigeria, and Turkey – were facing complex and inter-connected sustainability challenges from water scarcity, weather exposure, and land tenure disputes.

According to author of the new report and Earth Security Group CEO Alejandro Litovsky, country pressures – represented by 24 key ‘dimensions’ in the new report’s dashboard measurements – would trigger far-reaching international risks and instability without cross-border intervention.

Such risks were often overlooked by analysts and investors focussed on market volatility – ie on the symptoms of global disruption, not the root causes.

The complexity of these 21st century risks and the potential rise of liabilities against companies are targeted in the 2015 report with specific improvements needed in corporate intelligence, risk management, business innovation and diplomacy.

Companies urgently needed to move beyond CSR-led ambitions for ‘shared value’, towards a 21st century culture of ‘shared equity’ where investment, returns and joint ventures were more strategically designed to maximise prosperity across global value chains, he added.

Swiss Agency of Development and Cooperation's (SDC) Head of Global Programme Water Initiatives, Johan Gély, said, that by 2050, 45 per cent of global GDP will be in water-stressed regions of the world.

Complex geo-political sensitivities related to water management and security were central to understanding and addressing emerging market resource risks, he said.

The impact of regional water-related pressures extended far beyond water concerns, involving food, energy and infrastructure investments. Cross-border approaches to water pollution and scarcity are essential as local water is embedded in everyday products shipped around the world, he said.

SDC is investing $200 million in improving water resources and playing a key role in advocating new UN sustainable development targets for “safe water” not just “water facility”.

Nine of the 10 worst global risks are linked to water

Water is one of the world’s gravest risks, according to the Global Risks Report published earlier this week at the World Economic Forum in Davos. And the situation is actually worse than it might seem at first glance.