Sector Overview and Challenges
More than 90% of the urban population has access to drinking water, and more than 60% of the population has access to basic sanitation. However, access to reliable, sustainable, and affordable water supply and sanitation (WSS) service is lagging behind. Are the Services Reliable? No Indian city receives piped water 24 hours a day, 7 days a week. Piped water is never distributed for more than a few hours per day, regardless of the quantity available. Raw sewage often overflows into open drains. Are the Services Technically and Financially Sustainable? Less than 50% urban population has access to piped water. The Non Revenue Water (NRW: due to leakages, unauthorized connections, billing and collection inefficiencies, etc.) is huge, estimated between 40-70% of the water distributed. Operations and maintenance cost recovery through user charges is hardly 30-40%. Most urban operations survive on large operating subsidies and capital grants.
Are the Services Environmentally Sustainable? Water quality has deteriorated in most receiving bodies and in shallow groundwater as a result of uncontrolled discharge of raw domestic and industrial waste-water. Are the Services Affordable? Most households, forced to cope with poor quality water supply and sanitation service, spend time and money on expensive and unsafe substitutes, costing much higher than their monthly water bills. The inefficiencies in services and costs are passed on to customers, with the poor suffering the most.
Poor managerial and financial autonomy, limited accountability, weak cost recovery, perverse incentives and limited capacity has led to poor services to customers across the country. Urban India is at the bottom of most international measures of performance. The major challenges are:
Creating consensus on sector governance and institutional arrangements;
Developing and testing service provider models that have characteristics of well run public companies for different market segments (large/small);
Improving financial sustainability of providers (commercial, energy, Non Revenue Water);
Professionalizing the WSS sector.
Simply creating infrastructure (normally focusing on augmentation but neglecting the distribution network) and not addressing management of service does not lead to sustainable services. Further, the easy access to financing coupled with overlapping responsibility of policy making, planning, financing, implementation, maintenance and regulation, generally vested in the State Engineering Department, results in lack of incentive for accountable and efficient services. Hardly any State has a well-defined WSS Service Improvement Program supported by sound sector policies and institutional development plan.
Government Programs and Priorities
A number of programs have been launched to increase ‘access’ to WSS ‘infrastructure’, including the centrally supported Accelerated Urban WSS Program and recent programs like Jawaharlal Nehru National Urban Renewal Mission (JNNURM) and the Urban Infrastructure Development Scheme for Small and Medium Towns (IDSSMT). The seven year JNNURM program started in November 2005 and provides up to 80% grant financing to participating cities, with grant component smaller in the larger cities at 50%. The WSS sector has been a big beneficiary of the JNNURM program with more than 60% of total funds allocated for water and sanitation infrastructure. The Ministry of Urban Development (MoUD) also launched the National Urban Sanitation Policy (NUSP) in 2008 with the goal of making all Indian cities totally healthy and sanitized. The policy, for the first time articulated the importance of total sanitation, the need for integrated and pro poor city wide sanitation planning, with attention to operations and maintenance and achievement of outcomes. It is mandated that all states need to develop state sanitation strategies by 2011 and cities to develop city sanitation plans by 2011. To raise awareness and promote competition amongst cities, the MoUD undertook a Sanitation Rating of 423 Class I cities in 2010 and, along with bilateral donors, is supporting the preparation of City Sanitation Plans (CSPs) in 140 cities. The city sanitation planning "process" is intended to help cities articulate their sanitation requirements in an integrated manner, addressing the total cycle of sanitation (access, collection, conveyance and treatment/disposal), while also making choices that are compatible with the technical and financial capacity of the city.
While funding infrastructure creation and promoting institutional improvements, these programs are still work-in-progress and do not provide strong incentives for improving reliable and sustainable services to the beneficiary population. Hardly any State has a well-defined WSS Policy and Institutional Development Program. The true challenge is not only to increase access to infrastructure but to increase access to reliable, sustainable, and affordable services.
