Question

Why has water become an economic commodity? Discuss.

Answer 1

Water has become an economic commodity because it is in limited supply but needed for many purposes, such as drinking, agriculture, industry, electricity generation, and household use. The main reasons are:

• A growing population has increased demand for water.
• Urbanisation and industrialisation require large quantities of water.
• Agriculture uses a major share of available freshwater for irrigation.
• Groundwater is being overused in many areas.
• Pollution has reduced the amount of clean and usable water.
• Water must be collected, purified, stored, and transported, which adds to the cost.
• In many places, people have to buy drinking water from private suppliers.

Since clean water is scarce, in high demand, and costly to supply, it has acquired economic value and is increasingly treated as a commodity.