Urban water: Basics bear large yields

Ramani Iyer, Vice Chairman, Forbes Marshall

In the last 18 months, there has been a subtle, yet perceptible shift in focus in infra­structure field. In government circles inclu­ding the political management of the eco­nomy and bureaucracy, there is reco­gnition that investments in this sector can­­not be postponed or decelerated. Thus the Union Budget for 2012-13 will have some as­pects which reflect an aspira­t­ional challenge.
Increasing pressure of urbanisation and the scare about water scarcity and global warming have brought the drinking water and sanitation issues to the top of the priorities in the urban infrastructure area. Political parties have understood well that providing basic services will yield large dividends.

The success of the Jawaharlal Nehru Urban Renewal Mission (JNNURM) in urban roads/construction of flyovers and water projects has propelled increasing demands for funds from ULBs across the country.

We can expect the following this Budget:

1. Convergence of drinking water and sanitation issues.
2. Support to PPP models to boost private sector participation.
3. While providing for central funds, there may be calls for matching contribution by state governments. Performance-based release of central funds may be order of the day.
4. Continuing the current pattern of selective funding from IFCI/World Bank/ADB/JICA agencies.
5. There may be reform proposals to move big ticket projects to some kind of ‘single window’ clearance, particularly those stuck for MOEP approvals.
6. No fiscal incentives are likely to be part of the budget, unless there is some tectonic shift to bring about far reaching reforms quickly.