Recent Developments

A year of new policies, project awards, capacity expansion and digital initiatives

The past year saw noteworthy developments in the urban water supply and waste management sector. On the policy front, both the central and state governments have taken steps to improve water management. A number of key water supply and sewage treatment projects were completed. Several big-

ticket projects were announced to be taken up in the future. Further, urban local bodies (ULBs) have started raising resources from the bond market. There is a new willingness to adopt advanced technologies and digital solutions.

Indian Infrastructure tracks recent key developments in the water and waste sector…

Budgetary allocations and recent policy developments

  • Under Union Budget 2019-20, the Ministry of Housing and Urban Affairs (MoHUA) received a central outlay of Rs 480.32 billion. The allocation is substantially higher than the budget estimates of Rs 417.65 billion and the revised estimates of Rs 429.65 billion for 2018-19. The government has made specific allocations (under the central outlay) for the three major urban infrastructure development programmes. The highest allocation of Rs 139 billion has been earmarked for the Atal Mission for Rejuvenation and Urban Transformation (AMRUT). An amount of Rs 27.5 billion has been allocated for the Swachh Bharat Mission (SBM) and Rs 64.5 billion has been allocated for the Smart Cities Mission (SCM).
  • On the policy front, the Central Ground Water Authority of the Ministry of Jal Shakti notified revised guidelines for groundwater extraction in the country. These guidelines came into effect on June 1, 2019. As per the new guidelines, a water conservation fee will be levied on the use of groundwater depending on the area, type of industry and quantum of groundwater extraction. Further, the guidelines encourage the use of recycled and treated sewage by industries and provides for action against polluting industries.
  • At the state level, in July 2019, the Meghalaya state cabinet approved a draft water policy that seeks to protect the state’s water resources and improve their management. The policy also recommends the setting up of rainwater harvesting structures in all buildings and reviving traditional water harvesting structures, springs and waterbodies through repair, renovation and restoration programmes.
  • Earlier, in February 2019, the Maharashtra government adopted an Integrated State Water Plan with the aim of ensuring equitable distribution of water by diverting it from overfed areas to drought-prone regions. The plan also mandates that all civic bodies set up a mechanism for recycling and reuse of at least 30 per cent wastewater and that industries recycle 100 per cent of the wastewater generated by them.

Update on key government programmes and schemes

  • Over the course of the past four years, the three flagship central programmes have made considerable progress. Under the SCM, in four rounds of selection, 100 cities have been identified for being developed into smart cities. As of July 2019, 3,700 projects worth about Rs 1,360 billion have been tendered. Work orders have been issued for 2,900 projects involving an investment of more than Rs 900 billion. Meanwhile, 900 projects worth more than Rs 150 billion have been completed.
  • Under AMRUT, as of July 2019, 1,132 projects involving an investment of about Rs 340 billion are at different stages of development. With regard to the water and wastewater segment, about 5.8 million water tap connections and 3.74 million sewerage connections have been provided so far.
  • The SBM-Urban has also achieved remarkable progress. In 24 states/union territories, 4,276 cities have been declared open defecation free. Till June 2019, about 5.89 million individual household toilets and 0.5 million community toilets have been constructed. Further, 76,851 wards are practising 100 per cent door-to-door collection of waste and 56 per cent of the waste collected is being processed.
  • Under the National Mission for Clean Ganga (NMCG), a total amount of Rs 61.06 billion has been spent so far. Around 150 sewerage projects involving an investment of over Rs 230 billion have been approved for development. About 3,730 million litres per day (mld) of new sewage treatment capacity will be created and another 1,114 mld will be rehabilitated. Besides, a sewerage network of 4,972 km will be laid under the mission. As of May 2019, 43 projects involving the laying of a sewer network of 2,645 km and construction of sewage treatment plant (STP) capacity of about 576 mld in the Ganga basin have been completed.
  • With the objective of improving urban sanitation practices, in June 2019, the MoHUA launched the Swachh Survekshan League 2020, a quarterly cleanliness assessment programme for cities and towns in the country. It will be conducted in three quarters from April 2019 to December 2019. The ranking of cities in the Swachh Survekshan League will have 25 per cent weightage (in the total score for calculating ranks) as it will be integrated with the Swachh Survekshan 2020, the fifth edition of the annual cleanliness survey of urban India. Under Swachh Survekshan 2019, three cities – Indore, Ambikapur and Nagpur – have been ranked the cleanest.

 Project report card

  • The past year was marked by the inauguration of several big-ticket projects. On March 3, 2019, the Odisha government inaugurated the Improvement of Water Supply to Greater Berhampur Project (Janibili Water Supply Project). Earlier, in January 2019, the central government had inaugurated the Agra Water Supply Project (Gangajal Project) in Uttar Pradesh. A number of sewage treatment projects were also completed during the year. Five water supply and sewerage projects were completed in Bihar. Besides, a 36 mld STP was commissioned in Cuttack as part of the Integrated Sanitation Improvement Project.
  • Foundation stones were laid for a number of key water supply and sewerage projects. In Uttar Pradesh, foundation stones were laid for the Agra sewerage project and two intersection and diversion projects in the trans-Ganga/Yamuna area under the One City, One Operator scheme. In July 2019, the Delhi Jal Board laid the foundation stone for a 564 mld STP at Okhla under the Yamuna Action Plan, Phase III. Earlier, on June 24, 2019, the foundation stone was laid for the 477 mld water treatment plant in the Chandrawal area in Delhi. Some of the other projects for which foundation stones were laid during the year are the Thanjavur water supply distribution, the Thanjavur underground sewerage and the Muzaffarpur storm water drainage projects.
  • Several water supply and sewerage projects were also approved for implementation during the past year. For instance, the Mullaperiyar drinking water supply scheme was accorded administrative sanction, and the Visakhapatnam underground drainage project, five sewage projects in Uttar Pradesh (worth Rs 12.68 billion, under the NMCG), and the Prithviraj Nagar drinking water supply project in Rajasthan were also approved. In June 2019, the Kerala Infrastructure Investment Fund Board approved the implementation of the Kuttanad drinking water project (Rs 2.89 billion), the Thiruvananthapuram-Neyyar alternative drinking water source project (Rs 2 billion), and improvements to the water supply scheme of Kondotty municipality in Malappuram district, Phase II (Rs 1.08 billion). The Manmad water supply project in  Maharashtra and the Bisalpur water supply project in Rajasthan were also approved.
  • New formats and models were also tested for increasing private sector participation in the sewerage sector. On June 5, 2019, a concession agreement was signed with VA Tech Wabag for construction of STPs at Howrah, Bally and Baranagar and Kamarhati in West Bengal. The plants will be developed on a public-private partnership basis under the hybrid annuity model.
  • In the solid waste segment, ULBs in Delhi are planning to set up nine decentralised waste management plants, each with a treatment capacity of 5 tonnes per day. The Corporation of Chennai has passed a council resolution for the installation of two waste-to-energy plants at the Kodungaiyur and Perungudi landfills in Chennai, Tamil Nadu.

Financial developments

  •  On the financial front, several developments have taken place during the year. In January 2019, the Ahmedabad Municipal Corporation raised funds worth Rs 2 billion through municipal bonds for financing water and solid waste management projects under AMRUT. Besides, multilateral funding agencies too have granted loans for various projects. On March 8, 2019, the central government and the Asian Development Bank signed a loan agreement worth $26 million as additional financing for improving drainage infrastructure in Dibrugarh, Assam. The Asian Infrastructure Investment Bank’s board has also approved a loan worth Rs 28.52 billion ($400 million) for the Andhra Pradesh Urban Water Supply and Septage Management Improvement Project.

Technology adoption

  • Steps have been taken towards promoting the use of advanced technologies and digital solutions in the sector. The municipal agencies of Pune and Bidhannagar have installed smart meters to measure water leakages. Meanwhile, the Delhi Jal Board has set up a data acquisition centre for collating data from the central supervisory control and data acquisition system and flow meters to enable real-time monitoring of water supply.

Overall, the water and waste sector has been on a high-growth trajectory over the past few years. Government support by way of new programmes and schemes, policy and regulatory reforms and new innovative funding options have helped in sector development. However, to maintain the growth momentum, measures such as capacity building of ULBs, encouraging private sector participation, and timely completion of projects will be essential.

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