1. INTRODUCTION Rubber Industry is a major thrust industry in Kerala, which makes a significant contribution to national economy. Kerala accounts for 85 per cent of area under rubber cultivation and 92 per cent of the rubber processing industries are located and scattered all over the state. The state has 44 rivers and 32 river basins and most of the natural rubber processing industries are established in river basins (Central Environmental Authority, 1990). The regional concentration is mainly due to the availability of raw material, technical compulsions for timely processing and other locational advantages including adequate availability of water for processing and conventional facilities for disposal of the effluent. However the intensity of rubber production is very high in Kottayam district (Survey of Rubber based Industries, 1995-1996). Also it generates many employment opportunities to rural population having lower level of education. The technology used by most of raw rubber manufactures is very old and this results in low productivity and high environmental damage which people do not tolerate any longer. A closer look reveals that rubber industry consumes large volumes of water, uses tones of chemicals and other utilities and discharges enormous amounts of wastes and effluents. Water pollution, through industrial discharges which is mainly in the form of effluent or wastewater, is one of the biggest problems. Bioremediation is a pollution control technology that uses biological systems to catalyze the degradation or transformation of various toxic chemicals to less harmful forms. Bioremediation could be employed for the treatment of various industrial effluents. The general approaches to bioremediation are to enhance natural biodegradation by native organism (intrinsic bioremediation), or carry out environmental modification by applying nutrients or aeration (biostimulation) or through addition of microorganisms (bioaugmentation). Unlike conventional technologies, bioremediation can be carried out on site. 2 It is well known that the essential conditions in the environment for the well being of aquatic populations are basic to understand the problems created by pollution and evaluation of its detrimental effects. Since the effluents are rich in nutrients due to the loading of organic wastes, they afford ideal habitats for different microorganisms including bacteria, fungi and algae. The study on the floristic pattern and ecology of waste water algae and other microbes is of prime importance to understand the basic problem created on account of pollution, there are numerous reports dealing with the floristic and ecology of lentic and lotic alagae (Ganapati, 1940; Desikachary, 1959; Lakshminarayana, 1965; Vyas and Kumar, 1968) but the algal flora of waste water system have been little investigated (Kamat, 1982; Trivedi et al., 1982; Vijayakumar et al., 2005; Boominathan et al., 2007; and Senthil et al., 2012a). In comparison with freshwater systems, algae in waste water are exposed to different environmental stress and a study on the biological parameter of such water bodies certainly paves the way for future waste treatment programmes, using indicator species and hence the present investigation on the biodiversity of microbes in rubber effluent, such as bacteria, fungi and cyanobacteria in order to understand their utility in waste water treatment. The utilization of cyanobacteria in effluent treatment is a recent phenomenon. Since 1980, momentum of using cyanobacteria in waste water treatment has increased (Manoharan and Subramanian, 1992a, b and 1993a; Dash and Mishra, 1999a; Vijayakumar et al., 2005; Ganapathy Selvam et al., 2011 and Sanjay et al., 2011) cyanobacteria could be a good candidate for treatment of industrial effluents because of the following reasons. i) Cyanobacterial growth does not require energy rich compounds like other non-photosynthetic microorganisms. ii) They have simple growth requirements which use wastes as a source of reductant. This gives them an edge over other photosynthetic bacteria. 3 iii) Many cyanobacteria combine photosynthesis and nitrogen fixation. This is another advantage over other eukaryotic photosynthetic organisms. iv) Separation of cyanobacterial biomass is much easier than other microbial biomass due to their size. By keeping the above facts in mind, the present study was carried out by using two cyanobacterial species (filamentous and unicellular) isolated from the natural habitat for bioremediation. Suspended cultivation of microalgae has been employed to remove various nutrients and inorganic chemicals, some difficulties limit the practical application of suspended microalgae which include (a) monospecificity and good operation conditions are hard to be maintained, and (b) microalgae are difficult to be separated from effluent before discharge. Recently the use of immobilization to entrap microalgae for the removal of nutrients from waste waters show the potential to solve the above problems (Patnaik et al., 2001, Boominathan, 2005 and Vijayakumar and Manoharan, 2012). Immobilized living cells have some advantages over suspended cells as they provide simple treatment for liquid, final separation of cells not required, and metabolic activities remain constant for longer periods (Vijayakumar, 2012). Entrapment in porous gels and foams is one of the popular techniques for the immobilization of whole cells as they generally do not use toxic reagents. The most commonly used matrices for photosynthetic cells are agar and alginate gels and polyurethane and polyvinyl foams. A disadvantage of the use of agar and alginate is their low mechanical stability for long term use in bioreactors; moreover, calcium alginate gels are disrupted by phosphate ions. Polyvinyl and polyurethane foams offer better mechanical properties and are neutral to most commonly used ions (Brouers and Hall, 1986) and hence in the present study polyurethane foam was used for entrapment of cyanobacterial cells. 4 To develop suitable and efficient treatment systems, it is obligatory to understand the mutual influence and interactions between the effluents and organisms, so that manipulations to improve the treatment systems become feasible. Therefore, in the present study, cyanobacterial cells, capable of growing in waste water have been chosen and their role on the physicochemical properties of the effluent was studied. In turn, the influence of the effluent on the biochemistry of the cyanobacteria to an extent possible was also investigated. By keeping all the above in mind, the present investigation is aimed: (i) To isolate and identify microbes such as bacteria, fungi and cyanobacteria from rubber effluent. (ii) To find out the indicator species among cyanobacteria to treat rubber effluent. (iii) To study treatment of rubber effluent with both free and immobilized cyanobacteria particularly removal of various chemicals. (iv) To treat the effluent with polyurethane foam immobilized cyanobacteria. (v) To find out the influence of rubber effluent on the biochemical characteristics of cyanobacteria and (vi) To find out the effect of treated effluent on crop plants. 2. REVIEW OF LITERATURE 2.1. Biodiversity of microbes Algae in general, and cyanobacteria in particular, are assuming an increasing importance in biotechnology. Therefore it is necessary that a detailed survey of different habitats are made, to know what cyanobacterial species are available and subsequently to try to isolate, purify and establish a collection which could be used for a variety of purpose. There are numerous reports dealing with the floristic and ecology of lentic and lotic algae but the algal flora of waste water system have not been investigated much (Singh et al., 1969; Singh and Saxena, 1969; Rai and Kumar, 1976a, b, 1977, 1979; Trivedi et al., 1982; Gunale, 1991; Kanhere and Gunale, 1997; Tarar et al., 1998). In comparison to freshwater system, algae in waste waters are exposed to different environmental stress and a study on the biological parameters of such water bodies certainly paves the way for future waste treatment programmes using the indicator species. Palmer (1969) listed the algae tolerating different kinds of pollution and compared them with clean water algae. The algal flora and physico-chemical characteristics of effluents of the Indian Oil Refinery, Barauni, the Sindri Fertilizer Factory, Sindri; and the Mohan Meakin Brewery, Ghaziabad were studied by Kumar et al. (1974). The studies indicate that algae can tolerate and grow in highly polluted waters. The blue-green algae, flagellates and euglenoids are mostly associated with organically rich effluents and low in dissolved oxygen. Agrawal and Kumar (1978) made physico-chemical and biological analyses of the mercury containing effluents discharged by the Kanoria Chemical Factory Renukoot and the Rothas Paper Industry. They were highly toxic and did not harbour any algal populations. Subsidiary factors possibly responsible for the lack of algae in the effluents include the presence of some 6 amounts of zinc, copper, chlorides and organic matter and the deficiency of such major nutrients as phosphate and nitrate. The changes in algal flora in the Cauvery river due to industrial and domestic pollution were studied by Paramasivam and Sreenivasan (1981). It was found that in clear water zones, Chlorophyceae and Bacillariophyceae dominated. Below the outfalls of distillery and sewage wastes, Cyanophyceae dominated. Oscillatoria sub-brevis was found dominant in