Bring water, 3/4 cup sugar, cornstarch, cinnamon, and nutmeg to a boil; stir until thickened, about 1 minutes. Reduce heat to medium and add apricots and 1 tablespoon butter. Simmer until heated through, about 5 minutes. Transfer mixture to a 9x13-inch baking dish.
Combine flour, 1/4 cup sugar, baking powder, and salt in a large bowl. Cut 7 tablespoons butter into flour mixture until mixture resembles a coarse crumb. Stir milk into crumbles until topping is just moistened. Spoon topping over apricot mixture. Sprinkle remaining 2 tablespoons sugar over topping.
Bake in the preheated oven until golden brown, 30 to 35 minutes.
