Conference Report
This conference on the theme ‘Water and Sanitation’ is 7th in the series of lead-up events
prior to the 3rd Annual Meeting of the AIIB to be hosted by India in Mumbai on 25-26
June. The AIIB is a new Multilateral Development Bank with more than 80 member
countries headquartered in Beijing. India is the second largest shareholder after China
and is keen to leverage this platform to provide leadership, ideas and proposals on future
infrastructure for an Asian Century and also leverage the portfolio of the AIIB to finance
its selected infrastructure initiatives.
At RIS we are priviledged to associate with the Ministry of Finance as their knowledge
partner for the 3rd Annual Meeting of the AIIB and the lead-up events. We are grateful to
our industry partners in this journey and today I am particularly thankful to FICCI for
their support. I acknowledge the dynamic leadership and meticulous guidance of our
Director General Professor Sachin Chaturvedi and kind support of our mentors
Ambassador S T Devare, Dr Sheshadri Chari and Professor Amitabh Kundu.
We have witnessed great transformations in the sphere of infrastructure development in
India in the last 4 years under the vision and leadership of the Prime Minister and some of his able ministerial colleagues. This does not only suggest that key areas of infrastructure
have been prioritized and expedited tremendously, but also throws variety of lessons on
good governance in the area of infrastructure development. This includes novel PPP
designs, new models of financing, systematic monitoring, innovation driven
infrastructure and institutional and regulatory reforms.
Globally investment needs across infrastructure sectors, particularly in the emerging and
developing economies are huge. Multilateral Development Banks are a key source of the
additional finance. However, neither Governments nor the MDBs can cover this gap. The
new way forward has been suggested in terms of collaborations among concessional
finance, institutionalized financing agencies, innovative financing mechanisms, blended
finance and leveraging private capital. Also emergence of new technologies have made
planning and allocation even more challenging even as there are definite positive benefits
in terms of quality and coverage of conventional and new infrastructure. The forthcoming
AIIB Annual Meeting is slated to explore such issues.
To place the issues in context I recount flagship initiatives of the Government of India like
Smart Cities, BharatMala, SagarMala, Digital India and above all Swachh Bharat Mission.
In the lead-up events we have covered each of these initiatives and associated areas of
action and concern.
In the conference on Digital Infrastructure held last month in Bangalore it was referred
that Digital Infrastructure is the ‘infrastructure for infrastructure’. After the intensive
deliberations here, I can definitely say that ‘Water and Sanitation’ is in fact the ‘Mother’ of
all infrastructure and anchors sustainability of the environment and society in all possible
ways. This was wisely alluded to in the context of an age old Indian saying – “Jal hi Jivan
Hai”. Two of the SDGs – SDG 6 (totally) and SDG 12 (in spirit) have been directly devoted
to ‘Water and Sanitation’. The background paper by Mr Parameswar Iyer brilliantly
captures this point and reiterates highest political commitment towards SDGs in general
and SDG 6 in particular. Based on the stupendously rich conversations since yesterday I divide my conclusions
into three broad areas. The detailed conference report will be prepared in due course.
o Current Status – investments and achievements
o Key outcomes and recommendations for policy action and institutional reforms
o Other highlights of the proceedings
Current Status – investments and achievements
Since the inception of the National Rural Drinking Water Program in 2011, the coverage
of habitations with over 40 LPCD rural water supply has increased to 78 percent, in line
with supplying all habitations with sustainable and sufficient drinking water by 2030 as
part of the SDGs. Of these, 57 per cent of the population is also covered by Piped Water
Supply through public standposts. However, drinking water supply is alarmingly
depended on groundwater sources, to the extent that India is the highest consumer of
groundwater. This leads us to issues of water quality across the country.
The NRDWP provides grants for construction of rural water supply schemes with special
focus on water-stressed and water quality affected areas, rainwater harvesting and
groundwater recharge measures, and for operation and maintenance including minor
repairs.
On March 22,2018 World Water Day the Government of India launched ‘Swajal’ –
community – led drinking water projects aimed at providing sustainable and adequate
drinking water in an integrated manner to the rural masses.
The last few years have also seen a noticeable rise in the investment made on drinking
water through NRDWP, with a total of Rs 17,184 cr invested in the last three years alone.
Encouragingly, States have been investing their own funds as well – notable examples are
Gujarat, Bihar, Jharkhand and Telengana (Mission Bhagiratha – which has been a truly
ambitious programme to provide piped water supply to all households). On 2nd October 2014, the rural sanitation coverage stood at approximately 39 percent
while as of May 2018, it has increased to over 83 percent under the Swachh Bharat
Mission. However, the States that need significant improvement include Odisha, Bihar,
Puducherry and Uttar Pradesh.
The number of total household toilets built since 2nd October 2014 is 7,30,70,830; 3, 70,
243 ODF Villages; 387 ODF districts and 17 ODF States/UTs.
The 14th Finance Commission has emphasized delivery of basic services such as water
and sanitation in the utilization of basic (90 per cent) and performance (10 per cent)
grants provided to Gram Panchayats. Local funds are being used for capex and opex for
water supply scheme, rainwater harvesting, water treatment, retrofitting etc.
The Government of India has set up an arrangement of pooled funds called the Swachh
Bharat Kosh in order to enable companies to contribute towards the programme. The
funds collected is in the tune of Rs 1000 cr since October 2014.
Government is taking robust measures towards piped water supply to all households by
2030; improve water quality; focus on surface water vis-à-vis ground water;
decentralized irrigation and sanitation systems. It is also focusing on community led
initiatives and traditional approaches on waste management like the GOBARDhan
initiative.
Key Outcomes and Policy Recommendations
User Charges for Water and Water Tariff: In this context it was discussed that out of
3Ts – tax, tariff and budgetary transfers, tariffs may be most sustainable. It has been
argued that people are ready to pay for quality services and due to water scarcity and
water quality issues people are in any case paying coping charges. Poor do not benefit
from low user charges. They end up paying much more to vendors. So, operational cost
recovery is a feasible objective. The modalities of this are being worked out. It was suggested that non-revenue water supply in cities have to be significantly reduced. Water
budgeting and implementation of water meters need to seriously considered. Issues of
tariff for irrigation water were also explored. There is a big scope for disciplining water
use in irrigation.
Institutional Provisions: Water is a State subject in India, which comes in the way of
comprehensive national planning and programme in this sector. It was suggested that a
fresh look on the subject may be necessary to effectively address issues of watershed
management, and regulation.
Watershed Management and Water-intensity of Agriculture: It was pointed out that
river-linking initiatives are misnomer, and the correct approach should be linking of
water basins and sources of surface water for sustainable water management. It was also
highlighted that due to poor understanding and planning several water scarce states end
up having water intensive cropping patterns; case in point is Punjab. On the other hand
as an encouraging example it was highlighted that Chhattisgarh discourages rice
production during Rabi season and subsidizes wheat production. However, we need to
promote alternatives in irrigation systems like micro-irrigation and drip-irrigation for
sustainable water management since changing cropping patterns is less palatable to a
large section of farmers.
Private Sector Participation: Interventions in these sectors and utilities in most cases
are publicly funded. However, given the nature of challenges the private sector can be a
source of innovation and solutions. It is generally perceived that it is difficult for the
private sector to invest in water and sanitation globally. The range of issues includes
tendering process, sustainable revenue/tariff risk, bankability of projects and lack of
focus on issues of water quality beyond flow and supply. The successful cases of PPP
models in water supply from Manila and Nagpur were discussed in detail. In Nagpur
sewage water is being recycled for non-potable use in the industry. It was suggested that
the DBO contracts have to be effective. Right incentives for recycling and waste segregation have to be provided to tackle the challenges of landfill. Decentralized
solutions and use of technology for water supply and sanitation have been strongly
advocated.
Other Highlights of the Proceedings
In terms of better management of water – water footprint assessment of the private
industry could be adopted. Moreover, significant R&D is required in areas like scenario
building software to inform policymakers and citizens of the implications of different
patterns of water use. This would improve the response from both.
Urban areas mostly source water from water basins located at a distance. This has
significant cost implications. In order to keep these basins recharged and free from
contamination, interventions in terms of industrial waste management and reduction of
fertilizer use have to be adopted. This has social and political implications.
Conservation of water is equally important for ecological balance and protection of
species. Water wastage through modern but perceivably misguided household
purification devices and bottled water supply, needs fresh examination and mitigation.
It was highlighted that 498 Class I cities in India had treatment plants with average of
only 32 percent of treatment and 225 Class II cities have treatment plants with a further
poor average of 8 percent of treatment of the total waste generated. To improve the
situation, decentralized solid/septage waste management may be promoted. However,
regulation would be important for any decentralized approach.
There has been a call made to reduce food waste, plastic usage and general reduction of
waste through public awareness. Water-energy-food nexus is very strong.
Use of bio-toilets by the Indian Railway is a best practice and a success story from India in
terms of timelines and coverage. Such decentralized waste management technologies can
be adopted by urban housing societies as well. There is a need to improve spatial data generation by use of technologies for effective
planning and monitoring for water and sanitation.
Finally, institutional issues that need attention are:
o New financing options/cost sharing and cost recovery
o Regulatory issues around cost effectiveness, transparency, predictability, design
and capacity building, monitoring, accountability, project/impact evaluation
o From output based to outcome based assessment.
o Coordination, governance and social conditions.