Price of Productivity: Economic Returns and Health Externalities of Using Contaminated Water for Vegetable Cultivation in Pakistan’

Abstract

This study explores the economic and health impacts of using contaminated irrigation water from Manchhar Lake in Sindh, Pakistan, focusing on vegetable crops like garlic, spinach, and coriander. Manchhar Lake, one of Asia's largest natural lakes, is situated in the Jamshoro District. Data were collected through structured interviews with 50 farmers from five surrounding villages, utilizing a mixed-methods approach that combined qualitative analysis with quantitative techniques, including cost-benefit analysis (CBA) and the Cobb-Douglas production function. The findings highlight both short-term agricultural advantages and long-term health risks. The economic evaluation revealed a positive return on investment of Rs. 21,409 per acre, with the value of water estimated at Rs. 0.983 per cubic meter. The Cobb-Douglas model indicated increasing returns to scale, with significant contributions from labor and water inputs. Despite deteriorating water quality, vegetable farming remains economically viable. However, the degradation of water quality poses serious health risks to nearby residents. The CBA framework produced a Benefit-Cost Ratio (BCR) of 5.44, suggesting that every rupee invested generates Rs. 5.44 in revenue, though significant hidden costs associated with health issues temper these benefits. A sensitivity analysis confirmed the robustness of the results, while focus group discussions illustrated a stark decline in community health compared to the past. In conclusion, while farming using Manchhar Lake water is economically advantageous in the short term, the escalating health risks cannot be ignored. The study calls for urgent policy interventions, emphasizing water quality improvement and financial support mechanisms to promote sustainable agricultural practices, ensuring both economic viability and public health.