OPPORTUNITIES GALORESunil Ghorawat
July 26, 2016
There is no dearth of opportunities in the Indian water sector. This is a provocative comment to make, but it is perhaps a true one. Across the board, water professionals are spoiled for choices to understand where to look for future growth.
The Indian Prime Minister Modi's dream project of building 100 Smart Cities was launched last year, when the Cabinet chaired by him approved of INR 48,000 crore outlay to be spent on the project over the next five years. The Atal Mission for Rejuvenation and Urban Transformation (AMRUT), a mission aimed at transforming 500 cities and towns into efficient urban living spaces, has also been launched. The Cabinet approved INR 50,000 crore for this mission which is to be spent over the next five years. Both these projects are interlinked, as, each has a special focus on urban infrastructure development that is needed for the sustained economic growth of the country.
Water management is a key part of this urban creation. The USD 8 billion Smart Cities Project is intended to enhance the quality of urban life by providing a clean and sustainable environment with 24 hour water supply. The USD 8 billion AMRUT will focus on ensuring basic infrastructure services such as water supply, sewerage, storm water drains, transport and development of green spaces at over 500 cities across the country. These projects create unprecedented opportunities for the water sector, but more action is needed on the ground to rejuvenate the sector.
Namami Gange is perhaps the largest environmental engineering project in the world. The Government of India is now proposing the hybrid annuity-based PPP model, which has worked successfully in the highways sector. Going forward, no projects would be coming out on EPC basis in the belt. Under this new model, upto 40% of the capital cost would be paid by the government during the construction phase (typically 18 to 24 months from award). The balance would be paid as annuity payments by the government over 15 (to 20 years) of the project, covering the remaining capital investment and annual O&M cost. The payment is linked to pre-defined performance standards. About 6000 MLD STP infrastructure is planned to be developed through this mechanism.
The government is trying to create a market for the recycled water produced from STPs. It has signed agreements with Railways, Power, Petroleum and Industry Ministry, so that all bulk users in that geographical belt would be mandated to purchase this water. With stricter guidelines for discharge coming in, the opportunity for sewage recycling and nutrient recovery is starting to build.
Sea water desalination, community drinking water, ground water management and Non-Revenue Water reduction are all big opportunities waiting to leapfrog. So there are opportunities galore for companies and individuals to benefit from. However, a lot of this is talk and we would need to see how the execution happens on the ground. The leaders of tomorrow would be those who see the opportunities, execute their way through the myriad obstacles and achieve success on the ground.
Sunil Ghorawat is Editor-in-Chief, EverythingAboutWater magazine.
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