Cleaning up India’s implementation strategy

25-Feb-2016 # Clean India Source: India Inc

by Arnab Mitra

Government estimates show that the Swachh Bharat Mission involves an expenditure of about $10 billion over five years. But a detailed study conducted by the Centre for Policy Research, shows that this stimulus could be much larger – up to $135 billion over the next five to 10 years.

Sanitation, hygiene and clean energy are the buzzwords of our times in India now and major stakeholders – from the government of India, the governments of individual states in India, the World Bank and the Bill & Melinda Gates Foundation, among many others – are putting their political capital and their dollars where their mouths are. But changing people’s habits is proving more difficult than anticipated.

Ushering in a cleaner, greener India includes several initiatives.

They include:

  • Improving sanitation and cleanliness across India
  • Eradication of open defecation across India
  • Cleaning the Ganga and some other polluted rivers
  • Cutting carbon emission and controlling atmospheric pollution

These gargantuan goals are possibly the most ambitious any government has set for itself and involve thousands of stakeholders and an investment running into hundreds of billions, maybe up to half a trillion dollars over the next decade.Open Defecation in India,

Mitigating these problems offers companies across the world multi-billion dollar business opportunities. Of these, the initiative that has attracted the most attention is the one to end open defecation in the country by building millions of toilets across urban and rural India.

“Has it ever pained us that our mothers and sisters have to defecate in open? Poor womenfolk of the village wait for the night; until darkness descends, they can`t go out to defecate. What bodily torture they must be feeling, how many diseases that act might engender? Can’t we just make arrangements for toilets for the dignity of our mothers and sisters?” Prime Minister Narendra Modi has said.

To put Modi’s quote in perspective, more than 60 per cent of Indians do not have access to toilets and, therefore, have to defecate in the open. As a result 13 Indian cities feature in the list of the 20 most polluted cities in the world.

It is ironic. About a billion Indians have mobile phones but more than 700 million don’t have access to a toilet. This leads to serious hygiene-related ailments across the country – diarrhoea alone causes 350,000 deaths in India.

Apart from the health and wellness benefits, there is an economic aspect to the Swachh Bharat Mission as well. At a time when the Indian economy is battling tepid demand and a stagnant investment cycle, the programme to build millions of toilets can provide a multi-billion dollar stimulus to GDP growth.

Government estimates show that the Swachh Bharat Mission involves an expenditure of about $10 billion over five years. But a detailed study conducted by the Centre for Policy Research, shows that this stimulus could be much larger – up to $135 billion over the next five to 10 years.

Several industries, with significant forward and backward linkages with dozens of others, will be impacted.

They include:

  • Construction industry
  • Skilling and capacity building agencies
  • Fast moving consumer goods industry (soaps and cleaning agents)
  • Banking and micro-financial industry
  • Communication & public awareness sector and
  • Water treatment and engineering industry

SWM Chain of Activities

All these industries have massive job potential. The construction sector, in particular, employs millions of unskilled and semi-skilled workers and they stand to benefit from this programme. The soaps and cleaning agents sector, the communications and awareness industry, the engineering sector and the construction industry employ millions of white and blue collar workers.

Within the construction sector, the steel and cement industries are critical for the fortune of the Indian economy. Both these industries stand to gain, in terms of demand for millions of tonnes of output as the government and individuals build millions of private, public and community toilets.

Then, the ceramics and sanitary-ware industry will also stand to benefit from the demand for its products.

The value chain of bio-waste works in the following way: collection, transportation, treatment, reuse and disposal. Apart from the industries enumerated above, the heavy and light commercial vehicles sector also stands to benefit from the Swachh Bharat Mission.

Then, the value chain mentioned above includes the treatment of waste water as well as faecal waste. This can provide economic opportunities for entrepreneurs involved in fertilisers as well as generating power from bio-waste.

The World Bank has announced that it will support the Swacch Bharat Abhiyan with $1 billion in aid. The Indian government has sought help from the World Bank for this programme. The Bill & Melinda Gates Foundation as well as several Indian and foreign companies have also committed several million dollars for this mission.

The initiative presents a humungous administrative challenge for the government. Its success will depend on implementation. And that will pose fresh challenges for Delhi.

Possible Funding Structure Rural Capital Expeniture

Possible Funding Structure urban Capital Expenditre

Possible Funding tructure for rural Operations and Management Expenditure

Possible funding Structure for urban opex

ArnabArnab Mitra is Consulting editor, India Inc. He writes on business and politics.

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