Redesigning Institutions and Governance Systems for Urban Water Demand Management: Case of Developing City Delhi, India

Abstract

Water crisis is a manifestation of crisis in governance and institutional failure in the developing world. The traditional perspective of public good character of water has led to problems relating to resource and demand management in developing countries. In India the city governance model and state dominated institutions reflect the wasteful use of water, poor treatment of water sources and an unsustainable demand usage pattern leading to chaos in the sector. The social benefits of managing such demand through institutional change are immense. The present study attempted to identify empirically the demand management factors that drive choice of institutions based on perception of experts, stakeholders and consumers in the developing city of Delhi. The research uses multi-criteria analysis using efficiency, equity and sustainability indicators for the choice of delivery institutions. The determinants of optimal social choice were built using multi-nomial logit modeling. The results indicate that the water losses defined in terms of non-revenue water and recycling for resource use are dominant sustainability indicators for choice of institutional change. The shift in reform strategy to demand management interventions by bringing efficiency in distribution and use can eliminate the chronic supply shortages in developing cities. Systemic institutional change by redesigning of the governance systems incorporating gradual private sector participation will be vital for sustainability of the sector.Key wordsGovernanceinstitutionmulti-nomial logitresourcesustainability