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Economic Valuation of Wetlands
T. V. Ramachandra and R. Rajinikanth
Energy & Wetlands Research Group, Center for Ecological Sciences, Indian Institute of Science, Bangalore
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VALUATION OF LAKES IN BANGALORE – A CASE STUDY

Bangalore District is located in the heart of south Deccan of Peninsular India. It is situated in the south-eastern corner of Karnataka state (12o39’ – 13o18’ N latitude and 77o22’ – 77o52’ E longitude) with a geographical area of about 2,191 sq. km at an average elevation of 900 m above the mean sea level. The climate of the district has agreeable temperature ranging from the highest mean maximum of 36.2o C in April to lowest mean maximum of 11.4o C in January. It has two rainy seasons from June to September and from October to November coming one after the other but with opposite wind regime, corresponding to south-west and north-east monsoons. The mean value of the rainfall of about 900-mm with standard deviation of 18.7 mm was recorded from the year 1875 to 1976. 

Status of a wetland depends on its management, level of anthropogenic activities, management of land, solid waste collection and disposal, disposal of used water and also attitude of the people at large. Urbanisation and anthropogenic stress to meet the growing land needs of Bangalore City have resulted in disappearance of wetlands, which has led to the discontinuity of the drainage network. Studies in Bangalore city, reveal about 35% decrease in number of water bodies from 1973 to 1996 (Deepa, et al., 1999). Earlier investigations have revealed that nearly 30 % of lakes are used for irrigation. Fishing is being carried out in 25 % of lakes surveyed. About 36 % of lakes are used for washing purposes and only 3% are used for drinking purposes. Agriculture is practiced in 21% of lakes. Approximately 35% of lakes are used for grazing by cattle. Mud lifting was recorded in 30 % and brick making in 38 % of the lakes (Krishna et al., 1996).

Economic valuation was undertaken in three lakes namely Hebbal, Amruthalli and Rachenahalli lakes. Hebbal and Amruthalli lakes are situated in Bangalore North taluk (east of Bellary road) while Rachenahalli is situated in Bangalore South and North taluks.

Hebbal lake valuation

To assess the importance of Hebbal Lake, a socio-economic survey was carried out in the catchment areas of the lake (Ranjani V.G and Ramachandra, T.V, 1999). A random survey of the houses situated within 1-km radius from the lake was carried out, using a questionnaire designed for the purpose.  The study was done in four areas around the lake namely Hebbal, Guddadahalli, Bhoopasandra and U.A.S. Layout. The first three areas (Hebbal, Guddadahalli, and Bhoopasandra) were semi-urban and the last one (U.A.S. Layout) was completely urban. The economic valuation of wetland resources was done on the basis of Contingent Valuation Technique. Table 2 gives the economic details of lake water benefits in terms of rupees.

Table 2: Results of the socio-economic survey
Area Domestic
(per 1000 people per day)
Agriculture
(per ha. per day)
Livestock
(per 1000 animals every 2 days)
  Water use Fodder
Hebbal Rs. 1937.50 Rs. 19.00 Rs. 2170.80 Rs.33500.00
Guddadahalli Rs. 1603.30 Rs. 19.00 Rs. 1250.00 Rs 37500.00
Bhoopasandra Rs. 1547.80 Rs. 5.00 Rs. 1270.80 Rs. 16666.70
U.A.S.Layout Rs. 1547.00

Livestock: The dependency for fodder is about Rs. 33,500 per 1000 cows for every two days. The dependency for the livestock on the lake water amounts to about Rs. 2170.8 per 1000 cows every two days. The dependency in the Guddadahalli area for fodder is about Rs.37,500 per 1000 cows every two days and the remaining Rs.1250 per 1000 cows every two days is the amount for water needed in economic terms to maintain the livestock. The total dependency for rearing livestock amounts to Rs. 38,750 per 1000 cows every two days. In Bhoopasandra area, the economic dependency for the livestock rearing is Rs. 17,937.5 per 1000 cows every two days. The dependency for water amounts to Rs. 1270.8 per 1000 cows every two days and for fodder, Rs. 16,666.7 per 1000 cows every two days. Here, people rear cows to earn a living and sell the milk in the surrounding areas.  The fodder available in the local market is very expensive and therefore people use the weeds in the lake as fodder, a cheap source of food.

Agriculture: Agriculture is still practiced in certain parts of Hebbal, Guddadahalli and Bhoopasandra areas. Many of these areas use the lake water for irrigating their fields (for growing a variety of greens). The dependency in the Hebbal lake catchment for irrigation is around Rs. 19 per ha. The dependency in the agriculture sector for Guddadahalli area is Rs. 19 per ha. This area also, like Hebbal is primarily agricultural, and depends on the lake or ground water for irrigation. In the Bhoopasandra area, the dependency on the lake for agriculture is about Rs. 5 per ha. This is because, a lone farmer in the area owns a coconut grove and he uses the lake water as well as the treated water to irrigate the land.

Domestic sector: The dependency for the domestic sector was calculated by determining the water use per individual. In the Hebbal area, the dependency was Rs. 1937.5 per 1000 people per day. While in Guddadahalli area, it was about Rs. 1603.3 per 1000 people, and Bhoopasandra area, Rs. 1547.8 per 1000 people. In the UAS layout, the dependency is Rs. 1547 per 1000 people. Residents in Hebbal area depend on ground water for their daily use more than the other areas, as they lack access to treated water supply.

The dependency was the highest for livestock maintenance since, fodder for the livestock is completely obtained from the lakes. The agricultural dependency is low in the areas ranging from Rs.5 to about Rs.19 per ha.  With lake restoration the agricultural dependency has increased, as the people have relatively clean water of the lake. The dependency of the domestic sector ranged from Rs.1547-1937.5 per 1000 people per day. This dependency was highest in Hebbal area, as the people there depended on the ground water for their daily needs.  An interesting thing that came into notice was that the people there used more water for bathing and the water used for bathing alone per individual was much higher than the surrounding areas. Though Guddadahalli is also dependent on ground water for its daily needs, the dependency was less compared to Hebbal.  The other areas (Bhoopasandra and U.A.S. Layout) have access to treated water, and so the people do not depend much on the ground water to satisfy their daily needs.

Rachenahalli and Amruthalli lake valuation

Socio-economic valuation was undertaken in two lakes, namely, Rachenahalli and Amruthalli (Rajinikanth.R and Ramachandra, T.V, 2000), to assign quantitative values to the goods and services provided by these wetlands. The economic value was measured in terms of public willingness to pay for the commodity. Total valuation assessment approach was used to assign the value of particular wetland as a whole in terms of rupees. This economic valuation concerned ultimately with the allocation of wetland resources to improve human welfare. Socio-economy survey was conducted to:

  • quantify the values of wetland resources; and
  • determine the economhc dependency of the people living in the surrounding areas on these lakes.

Approximate valuation of wetland resources based on their use values (human dependency and interactions with the wetland resources) and non-use values (no interactions with the wetland resources) were determined by conducting interviews with the local communities. A random survey of the houses around the lake was carried out using a standard questionnaire format exclusively designed for this purpose. It contains information on various human uses of wetlands for irrigation, domestic, recreation, food, energy and also livestock uses as a direct use value. The economic dependency of the people residing closer to wetlands is shown in Table 3 and the values are expressed in rupees. Ground water table is provided as an indirect use value, and biodiversity, culture and heritage as non-use values in Table 4.

Table 3: Socio-economic details
ITEMS Quantity of Amruthalli lake resources Amruthalli value in Rs. Quantity oflake Rachenahalli lake resources Rachenahalli lake value in Rs
Domestic consumption 277.9 l/ house/day 1.667 /house/day 214.97 l /house /day 1.289/house/day
Livestock consumption 59.28 L/cow/day 35.5 /100 cows/ 60.39 day l/cow/ day 36.18 /100 cows/day
Agricultural consumption 7201.02 L/ hectare/day 43.19/hectare/day 12087.8 l/hectare/day 72 /hectare/day
Agricultural products:
Paddy:
Ragi :
Flowers:
Guava:
Vegetables:
Coconut:


15.1Q/ha/0.5year
7.6Q/ha/0.5year
3.95Q/ha/year
74.23Q/ha/year
--
3000Nos./ha/yr


21140/ha/0.5year
4560/ha/0.5year
11847.9/ha/year
37115/ha/year
-,-
11253/ha/year      


32.00 Q/ha/year
12.5 Q/ha/0.5year
6.64 /ha/year
60.1 Q/ha/year
7.69 Q/ha/year
5100.2Nos./ha/yr


44814/ha/year
7500/ha/0.5year
19920/ha/year
30050/ha/year
10381.5/ha/year
19125/ha/year
Energy resource 0.47 Kg/person/day 117.5/1000 person/day 1.298 Kg/persons/day       324.5/1000 persons/day
Fishing products ----- ------- 75 Kg./day 900/day


Table 4: Valuation of Rachenahalli and Amruthalli lakes
Lake Direct use Indirect value Existence value
Use Value in Rs
Rachenahalli *Agricultural 9173.0 * Ground water table varies from 50 (vicinity of lake) to 250ft (at 2-3 km away from lake)
* It has greater capacity to retain flood waters from heavy rainfall and disposal of treated water from JNCASR
* birds and migratory birds
* culture and heritage value
* pooja during festivals
*Fuel 324.5
*Fish 900
*Livestock consumption 37.5
Total 10435.00
Result Total value is Rs. 10435 per day, during cropping and fishingseason. Ground water recharge and flood protection is increased due to lakebed perviousness. Functional aspects, bio- diversity and cultural, recreational aspects indicate importance of the wetland eco system.
Amruthalli *Fuel 12.5 * Ground water table varies from 180ft (vicinity of lake) to 400ft (3 km away from the lake)
* It has lower flood protection value.
* Existing lake has no culture, heritage and biodiversity value
*Livestock consumption 7.5
Result Total value is Rs. 20.0per day. Lower value is due to eutrophic condition of the lake which has made the wetland resources unusable It has no ground water recharge and fewer flood control values mainly due to impervious lakdbed resulting from the accumulation of silt. This is due to pollution on account of anthropogenic activities in and around the lake.

Five villages were selected in this regard, namely Amruthalli (around Amruthalli lake) and Rachenahalli, Mestripalya, Srirampura, and Dasarahalli (around Rachenahalli lake). 

The valuation of wetland products was done using Market prices method and Contingent Valuation method with respect to public willingness to pay. By conducting this study, the requirements of the local communities and their economic dependency on the wetlands can be assessed.

In the case of Rachenahalli lake (by surrounding villages) the estimation is about Rs. 10,435/day (during cropping and fishing season) and Amruthalli lake is about Rs.20.0/day. This shows that, the economic dependency in the case of Rachenahalli lake is more than that of people living around the Amruthalli lake due to better water quality and ecosystem, which is explained in detail below.

Agriculture:  Wetlands are an obvious source of water for agricultural use. The economic dependency in Rachenahalli lake catchment for irrigation and its products is about Rs. 9173.0 per day, during cropping season. While Amruthalli lake, has no agriculture value. This is mainly due to decline in the water quality and quantity mainly due to eutrophication and drying of water during summer seasons. 

Fuel: Rachenahalli and Amruthalli lakes also yield fuel wood for cooking and heating. The economic dependency of communities in Rachenahalli lake is around Rs. 325 per day, while in Amruthalli lake it is about Rs.13 per day.

Fish: Wetlands also provide food for local communities in the form of fish and has socio-economic value attached to it. The dependency of the community on Rachenahalli lake is about Rs. 900 per day, during fishing season. This is mainly due to higher concentration of oxygen content. But Amruthalli lake has no value due to lack of oxygen concentration or oxygen deficiency, light  (transparency) and temperature.

Livestock: The economic dependency for livestock in the Rachenahalli lake water is about Rs.37 per day and in Amruthalli lake, it is about Rs. 7 per day. This mainly depends on the quality and availability of water in the wetlands. Amruthalli lake has lower value due to eutrophic condition of the lake that has made the wetland resource (water) unusable.

The ground water table of Rachenahalli lake ranges from 50 ft in the immediate vicinity and 250 ft at farther places (2-3 kms), while in the surrounding region of Amruthalli lake ground water table ranges from 180 – 400 ft. This is mainly due to sediments accumulated in lake-bed becoming impervious which hinders recharging. Sediment accumulation is due to siltation, which is a result of removal of vegetative cover in the catchment area. Apart from this, waste disposal in lake has resulted in eutrophic condition of the lake as a consequence of urbanisation and industrialisation.

Amruthalli lake is degraded mainly due to siltation, excessive input of domestic sewage, street and industrial effluents and dumping of organic waste materials from the surrounding areas. These have turned the lake eutrophic. Due to this, the economic dependency of people living in the surrounding area has become less. To avoid eutrophic conditions and to improve the economic dependency of people residing closer to the lake, appropriate conservation and restoration strategies are needed.

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