India to invest $270bn in water infra over 15 years

The Union Minister for Finance and Corporate Affairs Smt Nirmala Sitharaman, on presenting the Union Budget 2019-20, stated that ensuring India’s water security and providing access to safe and adequate drinking water to all is a Government priority. Through the Jal Shakti Mantralaya, the Government aims to integrate the Ministry of Water Resources, River Development and Ganga Rejuvenation and Ministry of Drinking Water and Sanitation, in a combined effort to ensure piped water supply to all homes. This has opened up opportunities for lucrative investments in water infrastructure projects. 

Sure enough, according to a report by the Bank of America Merrill Lynch (BofAML), as much as US$270 billion is likely to be invested in water infrastructure over the coming 15 years, through programmes for piped water supply, river-linking, Namami Gange and Pradhan Mantri Krishi Sichai Yojana (PMKSY). This comes at a time when 21 major cities around India, including New Delhi, Chennai and others, are seeing rising shortages in water supply. At such a time, investment into critical water and sanitation projects will support the nation’s increasing urban population as well as economic growth.

Over the last four years, India’s central and state governments have already spent over US$75 billion on water related projects and are likely to increase the pace of these investments, according to Amish Shah, MD and Co-head of India Equity Research, BofAML. He added that the Central Government will be the facilitator, with investments from both centre and state entities and private participants. Meanwhile, fiscal 2019-20 Union Budget’s allocation for piped water supply has increased by 81 per cent. This will help plug the gap between the demand and supply of drinking water in India.