Times of India
21 December 2010
New Delhi, India

70% Of Economic Impact On GDP in ’06 Health–Related, Says Report
Inadequate sanitation cost India almost $54 billion or 6.4% of the country’s GDP in 2006. Over 70% of this economic impact or about $38.5 billion was health–related with diarrhoea followed by acute lower respiratory infections accounting for 12% of the health–related impacts.

These estimates are from "The Economic Impacts of Inadequate Sanitation in India", a new report released on Monday by the Water and Sanitation Program (WSP), a global partnership administered by the World Bank.

Christopher Juan Costain, WSP regional leader for South Asia pointed out that the report helped to quantify the economic losses to India due to inadequate sanitation and also showed that children and poor households bore the brunt of poor sanitation.

More than three–fourth of the premature mortality–related economic losses are due to deaths and diseases in children younger than five. Diarrhoea among these children accounts for over 47% of the total health–related impact, that is nearly $18 billion dollars.

The report estimates that in rural areas, where 50% of households are said to have access to improved sanitation, there are almost 575 million people defecating in the open. Similarly, in urban areas where 60–70% of the households are said to have access to sanitation, 54 million people defecate in the open and over 60% of the waste water is discharged untreated. This has led to huge public health costs, besides causing 450,000 deaths. It has led to an estimated 575 million cases of diarrhoea, and 350,000 deaths from diarrhoea alone, in the under–five age group.

It is the poorest who bear the greatest cost due to inadequate sanitation. The poorest fifth of the urban population bears the highest per capita economic impact of Rs 1,699, much more than the national average per capita loss due to inadequate sanitation, which is Rs 961. Among rural households too, the poorest fifth bears the highest per capita loss in the rural area at over Rs 1,000. "And these are hugely underestimated estimates because we have excluded mortality impacts," Costain says. The report admitted that many economic impacts like other diseases influenced by hygiene and sanitation and the impacts on pregnant women, low birthweight and long–term health had not been covered.

Health impacts, accounting for the bulk of the economic impacts, are followed by the economic losses due to the time spent in obtaining piped water and sanitation facilities, about $15 billion, and about $0.26 billion of potential tourism revenue lost due to India’s reputation for poor sanitation, the report says.