Government planning to privatize water distribution in Urban India.
Preparing Model Concession agreement that would serve as framework for PPP in water sector in all cities. Special emphasis on 100 smart cities and 500 cities under AMRUT.
It will address issues such as:
- User fee
- Tariff indexation to inflation
- Metering of water connections at household level
- Risk allocation among private and public entity.
Currently, only 20% of water connection in India are metered and non-revenue water is 40%. PPP route will be used to reduce non-revenue water and plug leakages.
Successfully done in Manila and Nagpur.
The main aim should be:
- To improve service quality
- To offer the benefit of competition to consumers
Inefficient public monopolies should not be replaced by private monopoly -> provisions for competition (by using common infrastructure etc.), Proper regulation, free consumer choice.