Water treatment business in India : Healthy demand for setting up desalination plants

Article Courtesy: IndiaWaterReview

IndiaWaterReviewThe water business in India has turned into a multibillion dollar industry as rising water shortages and pollution drive more and more companies to enter the fray with innovative technology, solutions and management expertise. Though there is no official figure available, industry estimates put the total worth of the water business in India to be close to $5 billion, or about Rs 20,000 crore.

Each year, the government spending on water infrastructure is increasing under various schemes. The state governments are also hiking investments in setting up more water and wastewater treatment plants, refurbishing old and broken water supply lines and setting up water supply projects to cater to growing demand from urban customers.

The water business is largely split between municipal and government, industrial and commercial, agriculture and household sectors. The municipal and government sector remain the most active in which crores of rupees are being invested across the country to increase water supply through various means. Investments are pouring in the treatment of used water, or wastewater, to create additional water supply that can be used for non-potable purposes.

There is now a healthy demand for setting up desalination plants in India. These projects are coming up in several coastal cities. Chennai is leading with two big desalination plants already set up and plans afoot for more to follow. Mumbai is also looking to set up a desalination plant as are some cities in Gujarat. On the eastern side of the country, India’s second largest industrial hosue is mulling setting up a large-scale desalination plant to create a captive water source for its proposed mega industrial township in Orissa. A few companies in India are also exploring the market for nuclear desalination.

On the industrial and commercial side, the demand for process water treatment and wastewater treatment is rising as companies see a rise in water requirement with demand for their goods rising in the wake of a buoyant economy. Also, with strict government environmental norms making the cost of water pollution high, several small- and micro-industries have tied up to have common wastewater treatment plants set up so ensure that they meet the discharge norms. All of this is keeping the demand for products in this segment high.

The agriculture sector is a growing market too as more farmers adopt new irrigation techniques Water scarcity across several regions in the country is driving farmers away from the traditional methods of flood irrigation. So, companies that make drip and micro-irrigation systems are having a field day, with rising demand for their products leading them to expand capacities and look for acquisitions to gain new markets. Even water pipes makers are seeing a rise in demand in this sector.

In the household sector, domestic water treatment is a rapidly growing industry. There are now several local and foreign manufactures of home-based water treatment and purification systems, a testimony to the fact that the Indian consumer is getting increasingly conscious of the ill-effects of drinking polluted water. 

Since most of the water utilities in Indian cities have old water pipeline infrastructure, people are not taking chances with their health and are investing in water treatment systems. This has led to unprecedented competition in the market as several established players jostle for market share with new entrants and small and regional players make a dent in the unorganised market.

The sale of bottled and mineral water is also on the rise as more customers reach for a safe option to quench their thirst instead of relying on local water sources while travelling outside their homes and cities.