Water scarcity may harm India's credit health, says Moody's.

According to Moody's Ratings, India's increasing water scarcity poses a threat to the country's creditworthiness as it can cause disturbances in the agricultural and industrial sectors. The country's declining income and rising food prices could also lead to societal unrest.

Decreases in the availability of water, according to this source, can cause industrial and agricultural production to falter, driving up food costs and endangering the credit standing of companies that rely significantly on water, such steel and coal-fired power plants.

According to the report, India, the most populated nation in the world, will have less water available due to its quick economic growth, rapid industrialization, and urbanization.

Additionally, the acceleration of climate change is making extreme climate events like heat waves, droughts, and floods more often and intense, which is exacerbating the water stress.

According to a Moody's research on environmental risk confronting India, the country is experiencing an increasing scarcity of water as water use rises in tandem with rapid economic growth and an increase in the frequency of natural disasters brought on by climate change.

This is bad for the sovereign's credit standing as well as industries that use a lot of water, such steel and coal-fired power plants. Long-term investments in water management can reduce the danger of future water shortages, according to an analysis by Moody's Ratings.
The report is released in the midst of a rising water crisis that has sparked political unrest and protests among citizens in several areas of the nation's capital.

Atishi, the Minister of Water for Delhi, who started her hunger strike on June 21 over the matter, was admitted to the hospital on Tuesday morning as a result of her health failing.

"Decreases in the availability of water can cause industrial and agricultural output to be disrupted, which can lead to food price inflation, income decreases for impacted firms and communities, and social unrest. Thus, the economy's resilience to shocks may be weakened and India's growth volatility may increase, according to Moody's.

According to Moody's, India's average annual water availability per person is expected to decrease from an already low 1,486 cubic meters in 2021 to 1,367 cubic meters by 2031, citing data from the Ministry of Water Resources. According to the ministry, water shortage is defined as 1,000 cubic meters or less, and water stress is defined as a level below 1,700 cubic meters.

According to Moody's, there will be a heat wave in June 2024, with highs of 50 degrees Celsius in Dehli and the northern Indian