Pavan Srinath yesterday wrote about the water subsidy in Bangalore, arguing in favour of “crisis pricing” of water in order to tide over the current water shortage. To support that he has produced the chart produced below which shows the total subsidy a household gets as a function of consumption.
The interesting thing to note is that there is “indefinite subsidy”. Ideally you would expect to get subsidy only up to a certain level of consumption. However, the data here shows that irrespective of how much you consume, you still get a significant subsidy for the marginal liter of water that you consume.
Pavan’s own comments on this chart can be found on his post at The Transition State