UN Scientists Say The World Has Entered An Era Of 'Water Bankruptcy': What Happens Now?

Last Updated:January 22, 2026, 16:52 IST

Scientists say 'water bankruptcy' captures a reality where natural systems can no longer recover, and where old approaches to water use no longer work.

Nearly 4 billion people, almost half the global population, face severe water scarcity for at least one month every year.

The United Nations is warning that the world has entered an era of “global water bankruptcy", a stage where rivers, lakes, glaciers, and aquifers are being depleted faster than nature can replenish them.

The idea marks a profound shift in how experts understand the planet’s water balance. For years, governments and international agencies described the situation as a looming shortage. But new analysis from the UN University Institute for Water, Environment and Health (UNU-INWEH) suggests something far more irreversible has taken hold.

The world is experiencing consequences, from shrinking lakes and sinking cities to crop loss and water rationing, that indicate natural systems can no longer bounce back to their historical conditions.

The UN researchers argue that the language itself must change. Earlier warnings were framed around a future that could still be avoided. The new research says the world has already crossed into a phase where water use outstrips nature’s ability to recover, and ecosystems have been damaged so deeply that old baselines are unlikely to return.

Why Scientists Say The World Is Now ‘Water Bankrupt’

The term “water bankruptcy" is not just a metaphor. In hydrological terms, it describes places where long-term withdrawals exceed natural resupply, and where the natural assets that store, filter, and regulate water — such as aquifers, wetlands, and glaciers — have been degraded beyond easy repair.

The numbers illustrate how widespread this is becoming. Nearly 4 billion people — almost half the global population — face severe water scarcity for at least one month every year. Many are already seeing the symptoms around them: dry reservoirs, worsening droughts, crop failures, water rationing and, in some regions, more frequent dust storms and wildfires.

UN scientists point to examples across continents. In Tehran, repeated droughts and unsustainable extraction have depleted reservoirs that the Iranian capital depends on. In the United States, demand on the Colorado River has long exceeded sustainable supply, affecting seven states that rely on it for drinking water and irrigation.

These situations, researchers say, are not temporary emergencies. They are signs of a deeper structural failure — the water equivalent of living on debt until the bank account collapses.

How Water Bankruptcy Develops

The analogy to financial collapse runs through the UN study. Just as monetary bankruptcy begins with late payments and borrowing, water bankruptcy starts when societies quietly take more water than nature replaces.

At first, the signs seem manageable: deeper wells during dry years, more powerful pumps, redirected rivers, drained wetlands. Over time, the hidden costs surface. Lakes shrink year by year. Coastal aquifers turn salty. Rivers that once flowed continuously begin running dry for portions of the year.

One of the most striking markers is land subsidence. When groundwater is drawn too quickly, the underground structures that hold water — much like a sponge — can permanently collapse. Mexico City is sinking by roughly 25 centimetres annually. Once underground pores are compacted, they cannot be restored, even if water later becomes available.

The UN’s Global Water Bankruptcy report notes that groundwater extraction has already contributed to land subsidence across more than 6 million square kilometres, including urban centres where close to 2 billion people live. Parts of Jakarta, Bangkok and Ho Chi Minh City are well-known examples of this decline.

The Ripple Effects: Food Systems, Livelihoods, And Security

Agriculture remains the world’s biggest water user, accounting for nearly 70 per cent of freshwater withdrawals. When a region becomes water-bankrupt, farming becomes more expensive and less viable. Jobs are lost, food production is hit, and national security risks rise.

Over 3 billion people and more than half of global food production are concentrated in areas where water storage is already declining or unstable. Around 1.7 million square kilometres of irrigated cropland face high or very high water stress, threatening global food supplies and increasing the risk of price spikes.

Climate change amplifies these pressures. Droughts are lasting longer and becoming more severe. Between 2022 and 2023 alone, more than 1.8 billion people experienced drought at some point. Warming temperatures increase the water needs of crops, raise the electricity demand for pumping, and accelerate the melting of glaciers that hundreds of millions of people depend on for seasonal water.

The effects play out in everyday life: hydroelectric shortages, public health risks, migration pressures, unemployment, and episodes of unrest.

What The UN Study Adds: A New Definition For A New Reality

Traditional labels such as “water stress" and “water crisis" no longer describe the world’s situation. Those terms, the authors say, imply a future challenge that can still be averted. But the new research finds that many systems have already passed a recovery threshold.

According to the UN report, the world has lost nearly 410 million hectares of wetlands in the past 50 years — an area roughly the size of the European Union. Many major rivers now fail to reach the sea for parts of the year. Around 70 per cent of heavily used aquifers show long-term depletion.

Glaciers provide another warning sign. Climate change has driven the loss of over 30 per cent of global glacier mass since 1970. As these natural water towers shrink, the reservoirs they feed become less reliable.

UNU-INWEH director Kaveh Madani called the trend a “warning" requiring a deep policy rethink. “Let’s adopt this framework. Let’s understand this. Let us recognise this bitter reality today before we cause more irreversible damages," he told AFP.

Why Past Approaches Failed

The study explains how societies gradually exhausted their water balance. Each region receives a “water income" every year — the amount nature deposits as rain and snow. When demand rises, governments and industries often try to cover the gap by tapping groundwater, draining wetlands, straightening rivers or diverting water from other basins.

These methods resemble borrowing money from savings. It works temporarily, but eventually the reserves disappear. Over the past five decades, more than 4.1 million square kilometres of wetlands have been lost globally. Water quality has also deteriorated as pollution, soil salinisation and saltwater intrusion render some sources unusable.

Meanwhile, cities, industries and farmland continue expanding, and now data centres are adding new water demands.

Even if not every country is currently water bankrupt, the UN notes that basins are interconnected through trade, migration and climate systems. Collapse in one region increases stress elsewhere, raising the possibility of geopolitical tension.

Can Water Bankruptcy Be Reversed?

The researchers argue that water bankruptcy requires the same response as financial collapse: acknowledging the situation and changing the system.

The first step is “stopping the bleeding" — setting realistic water-use limits based on what nature can actually supply, rather than drilling deeper and offsetting today’s shortages by burdening the future.

They also point to the urgent need to protect natural capital. Restoring rivers, rebuilding soil health, reviving wetlands, and enabling groundwater recharge are essential measures, not optional environmental add-ons.

Cutting water use fairly is another challenge. Policies that reduce supplies for poorer communities while protecting powerful users will inevitably fail. Sustainable transitions may include social protections, shifting farmers towards less water-intensive crops, and investing in efficiency.

The report emphasises better measurement as well. Many countries still manage water with incomplete information. Satellite systems now allow for early warning of groundwater depletion, land subsidence, wetland loss, glacier retreat and pollution.

Finally, the researchers stress the psychological shift required. Water bankruptcy means letting go of old assumptions about abundance and redesigning cities, farms and economies for a world with less.

As the report argues, bankruptcy can be a turning point, but only if the world accepts the reality of its depleted water accounts.

News explainers UN Scientists Say The World Has Entered An Era Of 'Water Bankruptcy': What Happens Now?

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