Investment in the area of environment management of GujaratChallenges and Opportunities

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Water Scenario in India

India has an average annual availability of water of 1869 BCM (Billion Cubic Metre) of which only 1120 BCM is utilisable for consumptionAccording to the Falkenmark Water Stress Indicator that India is reaching the water stress (1700 cum per person)A country with 16% of global population but only 4% of the global resources, water is one of the most important resource that needs immediate steps to prevent large scale problems in the futureDemand for water in India has been growing at a steady pace driven by factors like the population growth, rapid industrialisation and increased agricultural consumption.India also has wide spread regional disparity in water availability and the unevenness of water demand.North Eastern states face incessant rains and frequent floods, Western states such as Gujarat and Rajasthan receive limited rainfall which is insufficient to meet the local needs.

Water Scenario in GujaratGujarat, with 50 BCM of utilisable water, has a per capita water availability of less than 1,200 cum, far lower than the nation average of 1,880 cum.Most regions of Gujarat already lie in water scarce zones.The availability of water varies widely with South and Central Gujarat (accounting for 38% of Gujarats population) having an annual per capita water availability of 1,932 cum while North Gujarat has only 342 cum.Despite water shortages, Gujarat has witnessed industrial growth based on water dependent industries such as chemicals, petrochemicals, textiles and food processing.Projected water demand for domestic and industrial customers are 2000 MCM by 2025.

Overview of Water in GujaratSpatial distribution of water availability in Gujarat shows a wide variation.Southern region with less than 30% of states population have water availability higher than national averageNorth Gujarat and Kutch have to contend with near water starvation scenario.State has suffered drought like conditions in the past decades, which have further contributed to the depletion of existing water resources.Total utilisable water resources in Gujarat amount to 50 BCM break up reveals that surface water accounts for 75%.The rainfall pattern in the state shows the same degree of variation as the water availability.South Gujarat enjoys nearly 3-4 months of rainy season with average rainfall in the range of 1,100 1,200 mm. North Gujarat has rainfall in the range of 800-900 mm while Saurashtra has rainfall in the range of 400-800 mm. Kutch region has the lowest recorded rainfall in the state with less than 400 mm rainfall on an average.

Surface Water ScenarioGujarat has nearly 185 river basinsTapi, Narmada and Mahi are perennial riversRiver basins in regions like Kutch are plagued with issues of poor rainfall thus rendering them ineffective in providing a long-term solution to the water issues in the state.

Profile of RiversNarmada It covers nearly 160 km in the state and drains a catchment area of 11,000 sq km. The annual runoff in the Narmada Basin is 34,000 MCM. Some of the major storage projects on the river are Karjan (630 MCM), Tawa (2,310 MCM) and Barna (540 MCM).Tapi River drains 3,800 sq km in Gujarat covering 214 km. Annual runoff in the Tapi Basin is 6,700 MCM. Major storage projects on the river are Ukai (8510 MCM) and Kate Purna (98 MCM)Mahi This river flows for a length of around 583 km and flows through Panchmahal and Kheda district. It drains an area of nearly 11,500 sq km in Gujarat.

Surface Water ScenarioProfile of RiversMahi This river flows for a length of around 583 km and flows through Panchmahal and Kheda district. It drains an area of nearly 11,500 sq km in Gujarat. The annual runoff in the Mahi Basin is 4,360 MCM. Some of the major storage projects on the river are Mahi Bajaj Sagar (2180 MCM) and Kadana (1,540 MCM).Sabarmati This river flows fro a length of around 371 km and drains an area of nearly 17,500 sq km in Gujarat. The annual runoff in the Sabarmati Basin is 1,560 MCM. Sone of the major storage projects on the river are Dharoi (900 MCM) and Watrak (1,540 MCM).

Groundwater ScenarioDespite accounting for only 25% of the states water resources, groundwater is one of the most widely used sources of water in most regions of Gujarat.Limited availability of surface water and the lack of a proper distribution network had led to a great reliance on groundwater to met the water needs of most constituents in Gujarat.Annual replenish able groundwater resources in Gujarat are 15 BCM.The entire 15 BCM of groundwater cannot be exploited only 12 BCM are utilisable resources.The major use of groundwater resources is in irrigation (90%) while comparatively lesser usage is in domestic and industrial usage. The current scenario of groundwater usage in most parts points to a sorry state of over exploitation in many regions.The natural geological formations in the state are not conducive for percolation of groundwater in many areas.

Water Problem Mitigation Efforts in GujaratThe Gujarat Government has embarked on an ambitious programme to resolve the water shortages in the state.The Narmada Project was conceived with the aim of creating a river-linking project to facilitate an inter-basin transfer scheme where surplus water from some basins could be transferred to the water scarce areas.Water tribunal governing the Narmada Project has allocated 2,900 MLD for domestic purpose while 670 MLD have been allocated for industrial purposes.The scope of project spans to nearly 50% of the villages in Gujarat.The projects primary aim is to meet drinking water requirement.

Narmada Project

Water Problem Mitigation Efforts in GujaratThe Government of Gujarats long term aim is to create a State wide Water Supply Grid, that is aimed at inter-basin water transfer.157 projects are planned under Sardar Sarovar Canal based Water Supply Projects134 projects based on surface/ sub-surface sources under Rural Water Supply Program

Sardar Sarovar Canal Based ProjectSujalam Suphalam YojanaA project being developed in parallel to Narmada project is the Sujalam Suphalam Yojana. The focus districts of this project are the ten water scarce districts in Gujarat with a planned 32 schemes.

Regulatory Framework for Water Management in GujaratGeo-hydrological investigation of groundwater resourcesResistivity Survey in hard rock areasChemical & biological analysis of water & soil samplesRemote sensing data study & analysis for ground water feasible areas demarcationAssist in Planning, Design and Lay-out of Recharge Work, Lift IrrigationLaying distribution pipelines in command areas of tube wellsDeveloping lift irrigation schemesConstruction of recharge worksDrilling of tube wells in all terrainCleaning & fishing of tube wells

Gujarat Water Resources Development Corporation (GWRDC)

Regulatory Framework for Water Management in GujaratPlan and implement the Drinking Water Supply and Sanitation policyCoordinate and review all Water Supply and Sanitation ProgrammesCoordinate the Water and Sanitation programmes with Government of IndiaSupport Water Conservation and Harvesting ProgrammesFormulate and recover the water charges

Gujarat Water Supply and Sewerage Board (GWSSB)Assist in planning, implementing and maintaining drinking water supply systems and environmental sanitation (primarily for rural areas)Water management activities including rainwater harvesting, surface storage

Water and Sanitation Management Organisation (WASMO)

Regulatory Framework for Water Management in GujaratResponsible for the water extraction from Narmada RiverSale of water to units like GWIL which then sell water to GWSSB and other local bodies

Sardar Sarovar Narmada Nigam Limited (SSNNL)Nodal agency responsible for industrial estate developmentPrescribed water regulation rules for industries governed by the industrial estate

Gujarat Industrial Development Corporation (GIDC)

Regulatory Framework for Water Management in GujaratRepository of discharge norms for wastewater (industrial effluent, domestic)Maintains details about polluting industries and is responsible for ensuring that the industries are not violating the discharge normsResponsible for ensuring quality of drinking waterMaintains environmental data and research reports

Gujarat Pollution Control Board (GPCB)Responsible for bulk water transmission; it purchases water from SSNL and transfer it to GWSSB and urban local bodies

Gujarat Water Infrastructure Limited

Regulatory Framework for Water Management in GujaratResponsibility of urban infrastructure including water supply and sanitationOversee water harvesting activities, maintenance of lakes and other conservation activitiesMaintain storm water drainage canalsMonitoring body for Ahmedabad Municipal Corporation, Surat Municipal Corporation and Rajkot Municipal Corporation and other urban local bodies

Gujarat Urban Development Company Limited (GUDC)Gujarat Irrigation Department, Gujarat Geological Branch and Gujarat Water Resources Department are other important Government bodies manning this sector in Gujarat.

Business Opportunities in Water Sector in GujaratLimited availability of water in many areas coupled with regional rainfall disparity is leading to search for unconventional sources of waterRapid urbanisation/ industrialisationIncreasing restrictions on ground water usagePoor state of current water infrastructure/ absence of last mile infrastructure in may placesGovernment support for water project & favourable regulatory environmentNewer business models (BOT/ BOOT etc.) and niche service offerings (Operations and maintenance contracts etc)

Key Drivers for growth of Water and Sanitation Sector

Water Value ChainWater ExtractionWater Treatment

Water Supply& Distribution

Wastewater Collection

Wastewater TreatmentWastewater RecyclingWastewater Disposal

Attractiveness of Segments in Water Value Chain

Segment refers to the extraction of water from sourcesSegment includes dams, barrages and large storage reservoirs besides bulk water transmission network (Canals)Pumping stations that are required to transfer water upstream or pump it to long distances.Newer opportunities in this segment are lift irrigation schemesSegment is almost entirely controlled by the Government which dictates the investments.Private sector opportunity is limited to civil works required for constructing the require infrastructure works

Water Extraction

Attractiveness of Segments in Water Value ChainThe key enabler in this segment is the tightening of standards for human consumption (standards specified by CPHEEO)Need for high purity water in industries like food processing and thermal power plantsTechnology used in this segment are fairly standard leading to high levels of competition in this segmentMost projects are in EPC space, a growing number of water treatment projects are being awarded as part of a BOT project comprising of an integrated project for water supply and distribution.

Water Treatment

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Attractiveness of Segments in Water Value ChainSegment involves the setting up of a pipeline network in urban settlements or in rehabilitation and repair work carried out on existing pipelines.Segment has been the most active segment in PPP projects as the urban local bodies are looking at realising their commitments to provide water supply to their population through joint efforts with private players.Concerns about the PPP projects economic viability are being addressed in newer PPP models that encompass management and service contracts to long-duration BOT/ BOOT projects

Water Supply and Distribution

Attractiveness of Segments in Water Value ChainSegment consists of developing wastewater infrastructure and also upgrading the existing waste water collection network

Waste Water Collection NetworkKey enabler in this segment is the growing realisation of the harmful effects of environment pollution which has led to strict regulations that clearly specify discharge and water consumption normsPitiful scale of treatment levels for both domestic and industrial wastewater had led to growing investments in this space.Growth in this sector has been aided by the advent of newer, improved and economically viable technologiesCustomers for this water segment include municipalities that require treatment of domestic sewage and industries that generate wastewater consisting of harmful chemicals

Waste Water Treatment Plants

Attractiveness of Segments in Water Value ChainKey enabler in this segment is the growing shortage of freshwater resources, particularly for industries and rising costs of input water.Enhanced standard for discharge have already created a market for wastewater treatment systems.Cost benefit analysis of wastewater recycling setup over the lifecycle of the plant is a key enabler as recent advancements are proving the utility of using the recycling equipment to meet the water needs.Foreign players, with their advanced technologies, are key beneficiaries of the growth in this segment.

Waste Water RecyclingBesides these segments, private players can find also emerging opportunities in niche segments like micro irrigation (equipment manufacturing) and desalination (technology offering or project developer)

Potential Investment in Water Sector in GujaratBulk Water Transmission Project total potential is about INR 3,00,000 million on 25 year cycleManagement of Water Distribution total estimated potential INR 2,000 million per annumComprehensive data acquisition and online water quality monitoring total estimated potential for about 10000 km network to start withEnergy efficiency in bulk water and water distribution transmission projects total potential is about INR 200 million per annum

Investment Opportunities in GujaratImmediate OpportunitiesTotal Augmentation capacity of 225 MLD in Jaspur and Raska WTPs - AhmedabadTotal 100 MLD planned additional WTP capacity VadodaraSolar plant at Kotapur Ahmedabad90 MLD WTP planned under EPC mode SuratSeveral new STPs & Sewerage network planned with estimated investment of INR 267 Cr VadodaraCombined opportunity in 4 STPs for 200 MLD with estimated investment of INR 180 Cr SuratTertiary treatment plants 60 MLD with estimated investment INR 100 Cr SuratSTP at Gauridad of 70 MLD, Raiya of 56 MLD RajkotExtension of Madhar STP 45 MLD under BOOT basis - Rajkot

Water and Waste Water

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