Visualization of NATIONAL WATER RESOURCES FRAMEWORK STUDY done by CEEW

NATIONAL WATER RESOURCES FRAMEWORK STUDY

Core Team Senior Policy Adviser & Project Coordinator: Arunabha Ghosh Senior International Water Resources & Irrigation Specialist: Martin Anthony Burton Senior National Water Resources & Irrigation Specialist: Rahul Sen Senior International Water Supply & Regulation Specialist: Simon Gordon-Walker Senior National Water Supply & Regulation Specialist: Anand K. Jalakam Copyright © 2011 Council on Energy, Environment and Water All rights reserved. No part of this publication may be reproduced, stored in a retrieval system or transmitted, in any form or by any means, electronic, mechanical, photocopying, recording or otherwise, without prior permission. A report on a national water resources framework study for the Planning Commission, Government of India. This document is a summary presentation of a report prepared by the Council on Energy, Environment and Water with a research team comprising independent experts. The report was commissioned on the request of the Planning Commission of India to the 2030 Water Resources Group, via the International Finance Corporation. The views expressed in this report are those of the authors and do not necessarily reflect the views and policies of the Council on Energy, Environment and Water or of the 2030 Water Resources Group. The Council on Energy, Environment and Water (CEEW) is an independent, not-for-profit, policy research institution. CEEW works to promote dialogue and common understanding on energy, environment and water issues in India, its region and the wider world, through high quality research, partnerships with public and private institutions, and engagement with and outreach to the wider public. For more information, visit http://www.ceew.in.

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India’s Usable Supply of Water

1

1.

India’s Usable Supply of Water Vs

Projected Demand (2030)

2

Sectoral shift in water demand (in BCM)

2.

Business-as-Usual Demand Projections

3

Two premises underlie the need for a sustainable water future

1.

2.

India’s usable supply of water by 2030 could fall short of projected demand by 50%

Sectoral shift in water demand will add to the stress on available water resources

4

Government asked Team investigated + Insights

Recommendations + NWR Framework

Overview

5

+ Government asked Team investigated +

53 Questions •What works •Experiences

Insights Recommendations

•Diagnosis •Data •Interconnections

•Policy & Regulation •Management •Service Delivery •Complementary Interventions

6

NWR Framework Study

Roadmaps for Reforms

Overview

NWRF Study

7

Planners & Policymakers

NWRF Study can use to manage

Sustainably & Equitably

Water Resources

State National International

a comprehensive

study

across

IRRIGATION URBAN & INDUSTRIAL WRM INSTITUTIONAL

Planners & Policymakers

NWRF Study can use to manage

Sustainably & Equitably

Water Resources

8

NWRF Study

NWRFS Focus Areas

9

NWRFS Focus Areas

Silos?

10

Sectoral Use & Demand

NWRFS Focus Areas

11

Law, Regulation & Management

Law, Regulation, & Management

Improving farmer participation and service delivery

What should be functions of regulators?

Effective Public Private Partnerships

Addressing intersectoral demand

Energy -Water Nexus

Implementing Effective regulation

Water Utility Performance

NWRFS Focus Areas

12

Sectoral Use & Demand

Mexico

USA Chile Argentina

United Kingdom

Egypt

Turkey Italy

Poland

Germany

France

Spain

Kyrgyzstan Austria China

Australia

Case Studies: International

13

Gujarat

Maharashtra

Karnataka

Tamil Nadu

Andhra Pradesh

Orissa

Chattisgarh

West Bengal

Uttar Pradesh

Case Studies: India

14

3. Answers

relevant to policymakers

2. Case Studies

Study Outcomes

4. Recommendations

for 12th FYP

15

5. Roadmaps for

long term reforms

1. Evidentiary

basis for proposing

reforms

NWRFS Focus Areas Discussion

16

Irrigation

1. Re-engaging with Participatory Irrigation Management (PIM)

2. Reforming Management in the Irrigation and Drainage (I&D) Sector

3. Performance Management

in the I&D Sector

17

18

History: Participatory Irrigation Management in India

“At the heart of the reform agenda is irrigation management transfer to farmers. As found in countries such as Mexico, Turkey, Chile, and Australia, etc. farmers can better manage and maintain systems than government, and have the direct incentive to do so.....”

- Report on the Irrigation Sector (World Bank, 1998)

19

WUAs in India

No. of Water User Associations (WUAs) per 1000 Ha

• Implementing O&M

• Crop planning, crop water budgeting & raising irrigation water demand

• Implementing water distribution • Support in estimating and collecting water

charges

Functions

20

Key Issues

• ID currently focused on construction rather than MOM (management, operation and maintenance)

• ID staffed with civil engineers rather than water management engineers.

• Lack of understanding/ interest in water users and irrigated agriculture.

• Very poor standard of training and HRD in ID.

Recommendations • Gain acceptance at all levels in ID/WRD for PIM

• Establish WUA Support Units at field level

• Provide continuous training and support for

WUAs

• Change WUA laws to allow for WUA charter, fee setting and collection, etc

• Change water tax to a service fee collected by WUAs

• Maintain support to WUAs over 10-15 year transition period until fully institutionalized

Short term (12th FYP)

Long Term (10 – 20 Yrs)

Re-engaging with PIM

21

Lessons for WUAs

Andhra Pradesh

1984 Andhra Pradesh Pipe Committees formed under AP Irrigation and Command Area Development Act. These Committees prove unsustainable once the CAD programme had withdrawn from the scheme.

1997 AP Government took a policy decision to promote and support PIM and enacted the AP Farmer‘s Management of Irrigation Systems (APFMIS) Act.

1. Have proper legal status

2. Have a proper legal entitlement to water

3. Make WUAs accountable (to the ID) for the water used and area irrigated

4. Investment of time and resources is required in the short term to build WUA capacity

5. To succeed, water users (through WUAs) need to be given more responsibility with associated rights (such as being able to set, collect and utilise

service fees independent of the ID) 22

AP - PIM

• Meso-level management model

• Participatory Self Assessment (PSA) by WUAs

• Participatory Action Planning (PAP) to review performance, annual planning and implementation

• Maintenance through 100% tax re-plough + additional budgetary support

• Project level water scheduling plan

• Kharif planning by farmer organisation and engineers to save about water (20TMC in 2010)

• Synchronising crop sowing to reduce water release

AP PIM PROCESS

23

AP - PIM

Administration Water Management Sustainability

General Body Meeting Water Use Efficiency O&M Works

Managing Committee Meeting

Tail end Issues Area Under Second Crop

Maintenance of Records Water Release Schedule Tax Collection

Resolving Conflicts Warabandi Implementation Joint Azmoish

Transparency Innovations in Water Management

Additional Resource Mobilisation

Participatory Self-Assessment (PSA) Indicators

Strategy for sustainability | FTCs at circle level | Professional Training Coordinators | Exposure visits

Capacity Building

Management Development Programme | Technical programme including PIM | Exposure visits to farmer

managed system

WUOs

Irrigation Engineers

24

Farmer Field Schools

AP - Enhancing irrigated agriculture productivity

Increase in productivity - 15 to 20 %

Cost reduction - Rs.1500/- to 2500/- on inputs - KC Canal / Krishna Delta

Crop diversification to maize in Rabi - Higher C/B ratio & duty

Zero tillage in maize - Cost reduction Rs.2000/- per acre - Krishna Delta System / SRSP

Rotational irrigation in paddy - Higher productivity & duty

25

AP - Financial Sustainability

26

Reforming Management in I&D

Budget allocation to I&D (%) has decreased overtime

28

Ultimate Irrigation Potential vs. Potential Created vs. Potential Utilised

Little Irrigation Potential Remains (data for selected states, 2001)

29

Source: Planning Commission; Central Water Commission, Ministry of Water Resources, Government of India; NWRF Study Working Paper 3, Table 7 , Page 154

Significant growth in ground water pumping

1951 – 2009 Agricultural electric pump sets increased from 26,000 to 16.2 million Agricultural diesel pump sets from 83,000 to 9.2 million

26 160 1,618

3,568

9,696 8,446

16,184

83 230

1,546

3,101

4,659 7,237

9,200

0

5000

10000

15000

20000

25000

30000

1951 1961 1972 1982 1991 2003 2009

No.

of

pum

ps (i

n Th

ousa

nds)

Diesel Pumps

Electric Pumps

30

Years

Managing Groundwater for Irrigation

Vicious circle of energy-ground water circle

Power Utilities • Financial losses due to low

agricultural flat tariff

• Poor voltage and frequency power supply

• Huge T&D losses due to power theft & unauthorised pump sets

On farm • Water overuse to hedge against

poor voltage and infrequent power supply


31

10% of Total cost of supply

Rs 240 Billion / yr

25% of India’s fiscal deficit


32

Agricultural Power Consumption Subsidy

Technical Options

Agri Feeder Separation

Agri Feeder HVDS Conversion

BEE certified high efficiency pumps

Continuous and quality power supply

Regulate power supply to agriculture

MP and Gujarat : 20-40% power saving

Jyotirgram Scheme, Gujarat

Gaothan Scheme, Maharashtra

Restricts power theft

Reduces T&D losses

Potentially save 30% power

HVDS conversion in AP

Pilots in AP

Cases

Effect O

ption


33

• Separation of Feeders and conversion to HVDS

• Rational flat tariff strategy

• Replacement of pumps. Improving pumping system efficiency & management

• Participatory Groundwater Management (PGM)

• Agriculture Extension and Marketing Services (AES)

• Improving Water Application Efficiency – micro irrigation & agronomic practices

Comprehensive Agriculture-Demand Side Management

Managing Groundwater for Irrigation Strategy

34

Ag-DSM Comprehensive Model - Process

Legend


35

Widening performance gaps in irrigation

36

Irrigation Issues

Large

no. of small landholdings

Low crop yields water use productivity

Inadequate water distribution organisation planning for conjunctive use of SW & GW uptake of modern technologies

• Form effective WUAs with O&M staff

• Allow, plan and manage for conjunctive use

• Increase availability and uptake of modern technologies and improvements (drip irrigation, land levelling, SRI, etc.)

• Allocate annual and seasonal volumetric water entitlements

• Need better understanding within ID of on-farm water management to match supply and demand

On farm Service delivery Operation ( Main System) Maintenance (Main System) Finance HR development Education and Training Management, Policy & Processes

37

Solutions Issues

Top-down approach by ID

Lack of service delivery agreements

between ID and WUAs

•Create service delivery culture in the ID •Have service delivery agreements between ID

and WUAs •Link service fees paid to service delivered on

individual schemes •Partnership of WUAs and ID for enhanced

agricultural production and productivity of water on individual schemes

Current payment and service delivery arrangements

Ideal service delivery relationships

Solutions Issues

On farm

Service delivery Operation ( Main System) Maintenance (Main System) Finance HR development Education and Training Management, Policy & Processes

38

Irrigation Issues

39

Irrigation Issues

Lost Productive Potential Due to Poor O&M

On farm Service delivery

Operation ( Main System)

Maintenance (Main System) Finance HR development Education and Training Management, Policy & Processes

Operation ( Main System) Inadequate • assessment of individual scheme performance. • use of modern technology for water

management. • discharge measurement in irrigation systems. • on-farm knowledge amongst ID staff of crop and

irrigation water management. • conjunctive use of SW & GW

Maintenance (Main System) Lack of • funds for maintenance • transparency and accountability No Links • between maintenance needs and water

charges • between water charges collected and

maintenance work carried out on individual systems

• Look at system for covering costs of recharging GW from SW

• Modernise system operation (use RS, GIS, MIS, etc.) • Introduce performance management for individual

schemes • Introduce water audits, assess costs of poor O&M • Significantly improve ability to measure, record and

utilise discharge data • Allow, plan and manage for conjunctive use

• Use (participative) AMP to identify maintenance, operation and management costs

• Link maintenance expenditure on a system to service fees collected

• Quantify costs of failing to properly maintain I&D systems




40

Irrigation Issues

Solutions Issues

Asset Surveys Performance Surveys Liaise with Water Users on Level of Service Provision

Create Asset Database Identify Current Standards and Levels of Service

Specify and agree Standards and Level of Service targets

Formulate Asset Management Plan

Implement Asset Management Plan

Assess Water User’s Ability to Pay

Monitor Level of Service Requirement and Provision

Maintain Asset Database

Monitor Implementation of Asset Management Plan




41

Irrigation Issues

Need for comprehensive asset management plan

Fund Allocation top-down inadequate for system MOM

Out-dated approach to assessment and collection of water charges (labour intensive)

No link water charge and service provided

• Convert the water tax to a service fee

• Use AMP to make assessments of MOM costs and fees required at (i) on-farm level, (ii) main system level

• Reduce water tax/service fee transaction costs by allowing WUAs to collect the fee

• Look to increase the contribution of water users to system MOM by allowing WUAs to set, collect and utilise service fee, retaining on-farm portion and passing main system portion to ID

On farm Service delivery Operation ( Main System) Maintenance (Main System)

Finance HR development Education and Training Management, Policy & Processes

42

Solutions Issues Irrigation Issues

HR management is relatively weak:

• lack of timely promotion of the more capable

staff

• inadequate training in system operation and maintenance

Improve HR management by modernising:

• promotion system to encourage more able staff

• recruit professionally trained HR personnel

• training provided (remote sensing, GIS, MIS, computer scheduling, etc.)


Operation ( Main System) Maintenance (Main System) Finance

HR development Education and Training Management, Policy & Processes

43

Solutions Issues Irrigation Issues

Current implementation of WALMIs poor:

• inadequate number of experienced and skilled

trainers

• inappropriate/non-experienced staff transferred to WALMIs

• lack of adequate funds

• relatively few trained irrigation/water management professionals within the ID

Improve the quality of WALMIs:

• greater support from senior ID management (including more funds)

• dramatically change staff appointment system

• upgrade trainers’ knowledge and skills

• Support ID staff in attending postgraduate courses

• Create associated positions to allow staff to apply new knowledge

Solutions Issues


Operation ( Main System) Maintenance (Main System) Finance HR development

Education and Training Management, Policy & Processes

44

Irrigation Issues


Operation ( Main System) Maintenance (Main System) Finance HR development Education and Training

Management, Policy & Processes

• Focused on construction rather than management

• Few professionals other than civil engineers

• Top-down attitude to water users

• Lack of focus on overall scheme performance and outputs

• Staff are often transferred after 3 years, insufficient time for working knowledge

Change

• culture of ID from construction to MOM focus

• charter of ID to allow employment of a wider range of professionals

• attitude of ID personnel from seeing farmers as “beneficiaries” to seeing them as customers

Develop

• an ethos of service delivery

• culture of performance based management (adopt benchmarking, as in Maharashtra)

Encourage • early promotion of younger and

more able staff

Solutions Issues

Step Changes in Management Effort

45

Irrigation Issues

Complementary Interventions

Reengaging with PIM: • From construction focus to a MOM focus • Focus on service delivery and performance management • Change of attitude by ID staff to water users and PIM concept • Farmer field schools to enhance irrigated agriculture productivity

Reforming I&D and Performance Management in I&D:

• Change of culture within ID and farming community to paying by volume delivered. • Development of a service delivery and performance management culture with the ID • Acceptance by state politicians and senior ID managers of the role for management initiatives to increase agricultural production and water use productivity

46

Water Resource Management (WRM)

1. Managing Ground Water for Multiple Uses

2. Water Resources Management

3. Role of the Water Regulator in WRM

4. Perspectives on Legal Frameworks for WRM

47

Ground water stress and overdraft

48

All figures in BCM

Domestic & Industrial Demand Projection Across States

GW stress across sectors will increase

49

All figures in BCM

Legal Frameworks • Ground water Rights • Public Trust Doctrine • GW Regulation • CGWA

Ground Water for Multiple Users Water Resources Management Role of Water Regulators

WRM

• Under Indian common law there is no property in ground water until it has been the object of an ‘appropriation’ - by being pumped from a bore hole

• Transfer of Property Act IV, 1882 and the Land Acquisition Act, 1894 - Right to ground

water use is tied to land ownership

• Indian Easement Act, 1882, establishes limited links between ground water ownership and

land ownership

“The right of every owner of land to collect and dispose within his own limits of all water under the land which does not pass in a defined channel and all water on its surface which does not pass in a defined channel.”

Ground Water Rights

50

Legal Frameworks • Ground water Rights • Public Trust Doctrine • GW Regulation • CGWA


Supreme Court in M.C. Mehta v. Kamal Nath guides the legal framework governing water resources

“Our Indian legal system, which is based on English common law, includes the public trust doctrine as part of its jurisprudence. The State is the trustee of all natural resources, which are by nature meant for public use and enjoyment. Public at large is the beneficiary of the seashore, running waters, airs, forests and ecologically fragile lands. The State as a trustee is under a legal duty to protect the natural resources. These resources meant for public use cannot be converted into private ownership. … Thus, the Public Trust doctrine is a part of the law of the land”

The applicability of PTD to groundwater, however, remains unclear due to the two contrary orders pronounced by the Kerala High Court. Perumattty Gram Panchayat vs. State of Kerala (2003) Hindustan Coca Cola Beverages (P) Ltd vs. Perumatty Gram Panchayat (2005

Public Trust Doctrine for Natural Resources

51

WRM

Legal Frameworks • GW Rights • Public Trust Doctrine • GW Regulation • CGWA


• State governments have power to restrict construction of groundwater abstraction

• Authority can declare any area to be a ‘notified area’ if control, regulation, extraction and use of GW is deemed necessary

• Anyone (except small and marginal farmers) wishing to sink a well for any purpose within the

notified area must obtain a permit from the authority

• GW users in the State need a Certificate of Registration recognising its existing use and authorising the continued use of GW

• Authority could take steps to ensure that exploitation of GW resources does not exceed the natural replenishment to the aquifers

• Maharashtra, Gujarat, Karnataka, Tamil Nadu, Andhra Pradesh, West Bengal enacted ground water (regulation) legislation

Ground Water Regulation

52

WRM

Legal Frameworks • GW Rights • Public Trust Doctrine • GW Regulation • CGWA


• Central Ground Water Authority constituted under sub-section (3) of the Environment (Protection) Act, 1986

• Areas of activity

• Notification of areas for regulation of GW development

• Regulation of GW abstraction by industries

• Registration of drilling agencies for assessment of pace of development of GW and regulation of well drilling activities

• Representation in the National Coastal Zone Management Authority and other Expert Committees of Ministry of Environment & Forests

• Undertaking country-wide mass awareness programmes and training in rain water harvesting for ground recharge

“The problem is not in enactment but in enforcement.”

53

Ground Water Regulation - CGWA WRM

Managing Ground Water: Regional Problem?

Legal Frameworks Ground Water for Multiple Users • Supply side management • Demand side management

Water Resources Management Role of Water Regulators

54

WRM

State of Ground Water in India

Legal Frameworks Ground Water for Multiple Users • Supply side management • Demand side management


• More enthusiasm towards augmenting supply of GW resources than containing demand is seen

• Harvesting rainfall & tanks, dug wells, streams and canals use for GW recharge is becoming increasingly common

Supply Side Management

• Watershed Development programme by GoI for GW recharge: • Rs 17035 crore spent on covering

45.4 Mn Ha. cumulatively

• Rs 36,000 crore for 36 Mn Ha. proposed in 11th FYP

No hard evidence of significant and sustained improvement in GW status at sub-basin level

55

WRM

18

28

0.07

Watershed development undertaken by various ministries (in million ha)

Ministry of Agriculture ( Department of Agriculture & Cooperation)

Ministry of Rural Development ( Department of Land resources)

Ministry of Environment & Forests

Source: WP5, Table 9, here you can find the FYP for Rs.17035 crore also

Legal Frameworks Ground Water for Multiple Users • Supply side

management • Demand side

management


• APFAMGS Project: 650 villages, 62

hydrological units, 7 drought prone

districts

• Platform of Farmer Water Schools

Demand Side Management – Participatory Groundwater Management

• Participatory Hydrological Monitoring: farmers equipped to record & analyse GW level and

rainfall data

• Environmental Viability Assessment: Farmers equipped to assess GW recharge &

utilisation in given unit.

• Crop Water Budgeting: Crop selection according to water availability, Crop water budget session

at start of the Rabi season for alternative agriculture practices w.r.t GW availability

56

WRM

Increase in ground water

pumping 7%

Decrease in ground water

pumping 42%

Intermittent decrease in

ground water pumping

51%

Legal Frameworks Ground Water for Multiple Users Water Resources Management • Gaps • Phases in River Basin

Management • Governance of River

Basins • Water Resources

Administration

Role of Water Regulators

Gaps in Water Resource Management Accounting for • All uses: Agriculture, Domestic, Industry and Environment

• Rise in urban population: 40% by 2030 , 48-60% by 2050

Need for • Professional management of water resources

• Conjunctive use of surface and groundwater resources

• Long-term vision on WRM in India

• Engagement with stakeholders and end-users

River Basins • Many already ‘closed’

• Continuous focus on irrigation sector is no longer sustainable

57

WRM

Legal Frameworks Ground Water for Multiple Users Water Resources Management • Gaps

• Phases in River Basin Management

• Governance of River Basins

• Water Resources Administration


Phases in River Basin Development

58

WRM




Administration


Water Resource Management

Time

Management decisions at different phases of development

Empower Manage demand Enforce Legislate Construct

WRM

Areas for action • Engagement with stakeholders • Re-education of water professionals,

politicians and planners • Knowledge management and dissemination • Improved efficiency and productivity of water • Water trading • Institutional reform in the water sector

Threats and opportunities: • Reducing reserve for development • Increased risk (from droughts) • Climate change • Management options constrained • Involvement of stakeholders • Need for dialogue • Need for information dissemination 59

WRM




Administration


Integrated Planning of Water Resources

Benefits • Better utilisation of available water resources • Reduction in conflict • More intensive, and safe, use of wastewater • Improved water quality for both natural and human environment • Recovery of depleted groundwater resources • Inclusion of a wider range of stakeholders • Forum for resolution of crisis situations (natural or man-made)

Constraints • Requires genuine collaboration between agencies, organisations and individuals • Planning and decision-making can be more complex and time-consuming • Costs may be significant • Some stakeholders may need to relinquish power “to the common good” • Potential opposition to transparent and accountable decision-making

60

WRM




Administration


Enabling conditions for WRM

Political attributes

Informational attributes

Legal authority

Representation of interests

Balanced power Process transparency

Informational availability

Adequate powers

Information accessibility A

ttrib

utes

C

ondi

tions

Resources

Financial Appropriate Institutions

Human

Institutional

Infrastructure

61

WRM




Administration


Additional requirements for WRM

Institutional Data

• A Water Resources Act • To establish the proposed organisational

framework • To establish rights to water and conditions

of use • To cover both surface and groundwater • An apex coordination body • An executive body • Separation of water resources allocation

and water delivery • Consultative bodies to engage local

stakeholders in water resource planning, allocation and management

• Mapping of all water resources (surface and groundwater)

• River and stream flow measurements • Lake/reservoir water levels and volumes • Groundwater levels and quality in aquifers • Details of all water abstractions (type of

abstraction, use, location, quantities abstracted, etc.)

• Wastewater discharges into water bodies (volumes, location, type, quality, etc.)

• Flood levels, flows and areas inundated • Type and location of infrastructure (dams,

barrages, pump stations, wastewater treatment plants, etc.)

62

WRM

Legal Frameworks Ground Water for Multiple Users Water Resources Management • Gaps • River Basin


Basins • Water Resource

Administration


Water Resource Administration Possible Organisational Structure for WRM

63

WRM

Alternative governance structures

Planning Water Management Committee

Tariff Group of Ministers fix

Regulation Regulatory Commission – Quality, service standards and publication of annual audit report

Andhra Pradesh Maharashtra Legal Frameworks Ground Water for Multiple Users Water Resources Management • Gaps • River Basin



Administration


Planning Council under CM – Board under Chief Secretary

Tariff Regulatory Authority

Regulation Regulatory Authority assumes basic governance functions

64

WRM

Legal Frameworks Ground Water for Multiple Users Water Resources Management Role of Water Regulators • Regulatory functions

needed

Water Regulator

Regulatory functions needed • Set service fees (tariffs)- to sustain physical infrastructure over time

• Provide water users with rights or entitlements to water

• Plan and manage water resources in a rationale, transparent and accountable manner

Is a water regulator required?

Arguable Neither necessary nor desirable

Required Not necessary

No national irrigation/ bulk water supply market

To monitor tariff

To ensure service quality

Tariff could be set by service provider

Entitlements could be set by government

65

WRM

1. Developing a Water Conservation Strategy for Industry

2. Water Utility Management: Urban Water Supply Reform and Use of Public Private Partnerships

3. Governing the Entrepreneurial Sector

4. Regulation of Water Supply and Waste water

Urban and Industrial Water Use

66

Increasing Sector Demands

Business-as-Usual Scenario Prediction (figures in BCM)

Issues • Water conservation and efficiency across all sectors

• Increasing water and sanitation demands in the urban environment

• Support industrial and business growth

• Lack of governance expertise in delivering the infrastructure and management systems

67

PPP • Evolution in India • Motivation • Types and allocations • Models of Water Utility • India’s Experience • Case studies −India −International

• Lessons and Policy Considerations

Water Conservation Strategy (WCS) Governing the Entrepreneurial Sector Regulation

Urban & Industrial

Public Private Partnerships (PPP)

Evolution in India

Initial Market Development

International interest

Operator Sponsored

Poor results

Mid decade

Around 2000

Now

Way Ahead?

Mid to Late 90s

Efforts to prepare PPP projects

High NGO opposition

High profile projects run a ground

KUWASIP Success

Many ongoing initiatives

First Long term Lease signed

About 10 projects in progress

Source: Crisil 2011

68




Urban & Industrial

Public Private Partnerships (PPP)

Motivation

• Economic reform - business opportunities - generate economic growth

• Develop capacity in management and technical skills

• Catalyse investment in essential infrastructure

• Improvement of governance of urban services

69




Urban & Industrial

Public Private Partnership (PPP)

Types and Allocation

Options Ownerships O&M Capital Commercial

Risk Duration Increase in Risk

Service Contract Public Private Public Private 1-2 years

Management Contract Public Private Public Private 3-7 years

Lease Public Private Public Private 8-20 years

Concession Public Private Public Private 20-30 years

BOT/BOO Private & Public Private Private Private 20-30 years

Privatisation Private / Private

& Public Private Private Private Indefinite

70




Urban & Industrial

Public Private Partnership (PPP)

Models of Water Utility

24 x 7

BULK WAREHOUSING RETAIL

WATER INTAKE, TREATMENT &

PUMPING

STORAGE & TRANSMISSION

DISTRIBUTION, BILLING &

COLLECTION

CUSTOMER

SEWERAGE COLLECTION

NETWORK

SEWAGE OFFTAKE, TRANSMISSION, TREATMENT &

DISCHARGE

RECYCLE

Pollution Control Board

Water source

71




Urban & Industrial

Public Private Partnerships (PPP) India Experience • North Karnataka Cities, Nagpur, Alandur (Tamil Nadu) & Khandwa (MP): make PPP

potential solution for improving services

• Problems with not so well prepared or high risk PPP contracts: Mysore Delegated Management Contract and Aurangabad Water Supply Improvement Project

• Emerging social enterprise industry

What has possibly changed? • Demonstration of success stories • Focus shift from investment to management efficiency • Public finance and private management is increasingly accepted • Recognition of need for cost recovery • Increasing domestic entrepreneur interest • Selective outsourcing in utilities • Recognition of limitation of public sector service rules to manage essential round

the clock service delivery

72




Urban & Industrial

Case Studies - (PPP) Kanpur Water Account 2009-10

650/410 – Design/Average Production Capacity

All numbers in average million litres/day (MLD)

PRODUCTION AT RESERVOIR AT CUSTOMER

650/410 400 168

100 171/100

COLLECTION TREATED

200(GW)

Ganga

UNTREATED

+

280

SEWAGE

180

Experience in Karnataka (3 cities) Before After

Supply frequency 2 hrs in 3 - 10 days 24 hours

No. of connections 16399 24145

Non Revenue Water 45% 6% 73

Urban & Industrial

Case Studies - (PPP)

International PPP • Evolution in India • Motivation • Types and allocations • Models of Water Utility • India’s Experience • Case studies −India −International



74




Urban & Industrial

End goal is water utility management

Lessons

• “Political” commitment, leadership, agreement and stability are critical: at all levels

• PPP is not an objective in itself

• Each situation is different: no “standard” models

Policy Considerations • Arrangements are consistent with national objectives

• PPP targets: realistic, unambiguous & set in context of verified data

• Pro poor & community participation

• PPP partner company must have: financial strength and management integrity

• Clear process of tariff setting

• Political interference ‘free’ regulation

• Ensure good governance and accountability in public interest

75

PPP Water Conservation Strategy (WCS) • Delivery of WCS • Case Studies − International

Governing the Entrepreneurial Sector Regulation

Urban & Industrial

Water Conservation Strategy (WCS)

Potential water saving (%) in industry sector • Partnerships with industry

• Information and target

setting by industry type

• Best Practice Guidance – knowhow for businesses and industries

• Grant programmes and incentives linked to abstraction regulation and pricing policy

Potential water saving (in percentage) from measures applied in the industry sector

76

PPP Water Conservation Strategy (WCS) • Delivery of WCS • Case Studies − International

Governing the Entrepreneurial Sector Regulation

Urban & Industrial

Water Conservation Strategy (WCS)

International Examples

77

PPP Water Conservation Strategy (WCS) Governing the Entrepreneurial Sector Regulation

Urban & Industrial

Governing the Entrepreneurial Sector

• Water supply sector should embrace opportunities and services that entrepreneurs bring to improving water and sanitation

• Acceptance of entrepreneurial contributions through regulation: recognise their investment, protect them from unfair competition

• Entrepreneurship should be regarded in wider context: maintenance, outsourcing of services, suppliers of equipment

• Encourage the working of water supply sector: private sector relationship through legislation and by establishing an appropriate system of regulation

Forging Working Relationships

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Regulation of industry water use

Regulation Objectives • Over-arching objective: “that investments are used effectively in a way that

maximises their benefits to all water users and to provide a framework that induces public and private sources to finance investment projects”

• Public sector control over utility service providers (public or private)

• Ensuring service providers have financial resources to operate and invest

Good regulation in water supply: as a balance

Regulate - but also - Protect & Allow prices quality access

operations and investments from arbitrary government decisions

businesses sufficient freedom to manage according to business judgement

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Urban & Industrial

Options for regulation of industry water use

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Urban & Industrial

1. Water Governance at the State Level

2. National Water Commission

Institutional Reforms

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Possible Organisational Structure for WRM

Water Governance at the State Level • Possible organisational

structure for WRM • Possible State Water

Administration Structure

National Water Commission (NWC)


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Water Governance at the State Level

Possible State Water Administration Structure Water Governance at the State Level • Possible organisational

structure for WRM • Possible State Water

Administration Structure


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Water Governance at the State Level

Water Governance at the State Level National Water Commission (NWC) • Premise • Role of NWC • 12 FYP • Long term

Premise


• By some estimates usable supply of water will fall short of project demand in the next fifteen years

• There is expected to be a shift in the sectoral demand for water

• No alternative than to view the planning and management of water from a national perspective- if supply is fixed & demand rises

• Technical assessment of projects

– No mandate for assessing the state of water resources as a

– No obligation to continue assessments after clearances have been awarded

• Treating water as a national resource

• Availability of timely and usable information

• Capacity for management

– No countrywide institution that has the responsibility to assess the skills gap, identify the balance of human resources in different water subsectors

Rationale for an NWC: Gaps in current water management

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National Water Commission (NWC) Role of NWC

• Technical assessor to monitor progress during construction and timely completion of projects, and to continuously assess the management of projects after completion (support PC & MoEF)

• Guardian or watchdog of national water resources, states' rights and individual entitlements

• Aggregator and public communicator of data and information

• Facilitator and capacity developer

– Support states with advice on institutional design, capacity and skills development

– Offer technical advice and inputs

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Specific functions during the 12th FYP

• Empowered Working Group to start working on a National Water Strategy and submit proposals to the National Development Council

• Information collection and dissemination (up-to-date macro data to develop the broad elements, stimulate public debate)

• Capacity building activities, assessing skill gaps for water management through a service delivery mode

• Coordination and networking across sectors and levels of government

• Engagement with potential local and foreign investors

– full transparency concerning all contract details of individual projects


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National Water Commission

• Guardian and overseer of the National Water Strategy once it has been approved and adopted by the National Development Council

• Technical advice to central and state water administrations

• Watchdog of the rights of all water stakeholders and particularly the state of the country’s water resources

• Continuous benchmarking of best institutional practices, efficiency standards, human resource and capacity requirements

• Continuing role in information dissemination, transparency, capacity building, and public education and advocacy

Long Term

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Visualization of NATIONAL WATER RESOURCES FRAMEWORK STUDY done by CEEW

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