Water scarcity is an alarming 21st century issue. It is estimated that by 2025, two-thirds of the world’s population will be living in water-stressed conditions. Businesses around the world recognize this challenge as a threat to their reputations as well as their bottom lines.

IFC views water footprinting as an integral part of its climate change strategy given that it can help its clients reduce water-related risks, improve water efficiency, and limit their water-related social and environmental impact.

Water footprinting is a method similar to carbon footprinting that determines how much water a company uses in its operations as well as in its supply chain. It can also identify the social and environmental impact associated with that consumption. It is particularly useful for agribusiness, which consumes 70 percent to 85 percent of total fresh water. 

India is one of the world’s most water-affected countries. India-based IFC client Jain Irrigation Systems Ltd. is the world’s largest manufacturer of drip irrigation systems and operates in an area where water scarcity is an imminent issue. It is also the world’s largest producer of mango pulp, puree, and concentrate, and the second largest producer of dehydrated onions.  It was the first business in a developing country to conduct a Water Footprint Assessment, which led to a reduction in its water consumption as well as a strategy to increase local water availability.

IFC worked with Jain Irrigation Systems Ltd. to produce a Water Footprint Assessment which assessed the production of its dehydrated onions and the manufacturing of its micro-irrigation system (MIS). Among the most important findings was that onions grown under drip irrigation have a 42 percent smaller water footprint than those grown using traditional irrigation methods.

Overall, this Water Footprint Assessment serves as an example of an effective tool for managing water-related risks and paves the way for similar assessments for IFC clients in countries that face water scarcity. 

More broadly, IFC has been engaged in addressing water scarcity issues as a founding partner of the Water Footprint Network, a platform for private sector, academics, research institutions, international organizations and NGOs interested in furthering research in this field. 

Since 2007, IFC has also invested $133 million in Jain Irrigation Systems Ltd.

• IFC has invested $133 million in Jain Irrigation Systems Ltd. since 2007.
• Increased its water savings through a solid understanding of the water footprint of its operations.
• Increased uptake of its sustainable drip irrigation system by farmers in both its supply chain and in the broader region, replacing traditional flood irrigation systems

Jain Irrigation Systems, through this project:

• Formulated strategies for alleviating water scarcity and improving the sustainability of water use in the surrounding onion-growing region.
• Encouraged local onion farmers to use drip irrigation to reduce water consumption and pollution.
• Established a forum for local water stakeholders to work together toward sustainable water resource management.