Backed by a decisive parliamentary majority, Nepal’s new government has embarked on a much-needed corrective course to address decades of sluggish economic growth. It aims to raise per capita income to $3,000 within the next five years through 7 percent annual growth. However, it remains unclear if its leaders fully grasp the emerging challenges that now add a serious threat to economic sustainability. Rapid depletion of water sources, particularly groundwater, proves far more momentous than conventional environmental issues. While the government acknowledges the broader impacts of climate change, it’s unclear whether it truly understands the scale and urgency of the water crisis already affecting the economy, let alone possesses the resolve to address it effectively. The hard truth is that one cannot build a secure and prosperous future on an empty aquifer.

Poorly understood complexity

Groundwater, the primary source of water outside the monsoon season, is emerging as a silent but increasingly serious crisis in the country. From the mountains to the valleys and the plains of Tarai, groundwater levels have been falling steadily in recent years. In the hills, this depletion has caused many mountain springs to dry completely, depriving local settlements of their traditional water sources. In the Tarai region, groundwater levels are falling so rapidly that shallow tube wells have become ineffective, severely disrupting water supply for irrigation and domestic use to poorer households.

In the Kathmandu Valley, shallow aquifers have dried out. To meet this growing water demand, extraction from deeper, largely non-replenishable aquifers has continued to surge. Although the Melamchi water supply project, the first-ever large-scale trans-basin water transfer project built to meet the valley’s water needs, was expected to ease the pressure on the valley’s groundwater—particularly from water vendors and large corporate establishments—the pressure continues to mount. The full scale and complexity of the groundwater situation remain poorly understood.

The falling water table in Nepal has been attributed to the usual suspects: deforestation, mountain road construction, changing rainfall patterns, over-extraction, sealing of the recharge areas and others. Based on these attributions, recharge interventions are formulated and implemented, expecting the water table to stabilise and eventually recover. However, a broader picture of the water situation from remote hills in the Himalayas to its valleys and plains of the Ganga illustrates that the problem is far larger, more widespread and more complex than we had presumed. The limitations and blind spots of interventions based on these simplistic explanations are becoming clearer.

Deforestation or building mountain roads, believed to be responsible for the drying of springs in Nepal’s hills, does not answer why Bhutan lost about 25 percent of its mountain springs despite maintaining high forest cover and having far fewer road networks. Similarly, over-extraction may not be the sole or primary cause in every case. In Bihar, India, overall groundwater extraction remains below annual recharge, yet studies have recorded significant declines in the water table, including drops of up to 38 cm in a single year in certain areas.

Poor recharge, of course, plays a major role in groundwater depletion, but it does not fully explain the problem either. Bangladesh, for instance, lost roughly one-third of its groundwater within a single decade. At current rates of abstraction, projections suggest the water table in parts of the country could decline by up to 115 meters by 2050. It is important to note that Bangladesh’s delta sits at the lowest point of the Ganges-Brahmaputra basin, where these mighty rivers originating from the Himalayas ultimately debouch. These examples indicate the intricacy involved in managing groundwater.

Policy myopia worsens crisis

Regarding the ambitious economic targets set forth by the government, we must acknowledge a fundamental reality: No economic sector can truly flourish without a reliable and adequate supply of water. While almost every economic activity carries some level of water footprint, certain sectors are far less water-intensive than others. Even if one chooses to focus on the knowledge economy sectors, such as digital services, which can generate high economic value with relatively little water, the overall water demand will continue to rise. This is not only due to population growth, but also because of an increased need for data centres to manage a digital economy and rising per capita income and concomitant improved living standards. Water demand will increase at roughly the same proportion. Given the rapid depletion of groundwater, poor aquifer recharge and our continued failure to effectively address the long-recognised but less understood drivers of the water crisis, the water needed to support sustained economic growth risks becoming little more than a mirage.

While rainwater harvesting is widely admired and promoted, it is important to acknowledge its limitations if not planned well. Its effectiveness depends on numerous factors, including rainfall patterns (distribution, duration and intensity), local geology, aquifer characteristics and storage capacity, the quality of construction and ongoing maintenance of structures and most importantly, the scale of implementation. These challenges are further compounded by the deep-rooted and pervasive disorder, fragmentation and inefficiency within water governance, which have never been seriously addressed. This largely explains why, despite decades of efforts, effective and sustainable solutions have remained elusive.

Some interventions also risk aggravating the problem. To meet the water needs of communities in Nepal’s hills, where local springs and rivulets have dried, governments across the local and federal levels have been investing in deep bore wells to tap lower aquifers. However, this approach largely overlooks the risk that these deeper aquifers could also eventually run dry just as the upper aquifers and mountain springs did, ultimately disappearing because aquifer capacities are finite, whereas the water demand is anything but. The growing number of dysfunctional pumps in Kathmandu Valley offers a clear warning of the hard limits of groundwater extraction beyond which aquifers risk rapid depletion and eventual collapse. Transboundary water transfer may not always be feasible or available everywhere, physically and economically.

Strategic approach

The era of generous and wasteful water use is coming to an end. It is high time we raised widespread awareness about the looming water bankruptcy and seriously pursue demand-side management. Water has become our most precious public good, and without the active participation of users themselves, meaningful water management will remain an uphill task.

Policymakers, however, often prioritise immediate, high-visibility events such as annual floods, directing resources toward short-term response strategies. In contrast, the slower-moving but far more consequential threats, such as depleting groundwater that unfold gradually over years and decades, receive far less urgency and attention. Effectively addressing the crisis and bolstering the economy requires a comprehensive, whole-of-government approach that tackles both acute disasters and these creeping, long-term risks together. Since the groundwater table continues to fall due to multiple location-specific factors, the response must be equally decentralised, site-specific and sustained at the local level to ensure reliable access to water for all.