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Seminar 3 Group 1

Sara KhoshkarManon AlbarèdeIpsit Dash

Tirupur Water Supply and Sanitation Project

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Article Reviewed

ROOPA MADHAV

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Tirupur தி�ருப்பூர்

• Dollar City of India /Textile Hub• Indian Domestic Market ₹ 100 Billion,

$ 1 Billion exports , Net Market worth of ₹ 220 Billion

• Population Density is 16 000/km2

• Very High Floating Population• 1900 units of knit wear industries and

many local business settlements• Water Supply from Noyyal and Nallar

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Contents

Case Studies

•France

•USA

Group Recommendation

ScopeReview of Article•NTADCL

•BOOT Contract

•Reach

•Criticism

Summary

Water Governance in India

Status of Water Supply and Sanitation

PPP Benefits

Genesis

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Water Governance in India

• Basically managed by State Government and Local Bodies who adhere to Guidelines set by National Government

• Huge Allocation of Resources in every Budget ₹ 1526 Billion allocation in 2013

Water Supply Sanitation

• Rajiv Gandhi National Drinking Water Mission Given the Status of a Mission

• National Water Policy

• National Urban Sanitation Policy

• Nirmal Bharat Abhiyaan• Nirmal Gram Puraskar

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Status of Water Supply and Sanitation

Indian water problem inadequate resources & Inefficient management to subsidize

water availability and its distribution• Disparity between Rich and Poor : Caste System : Imbalance• Delhi, Mumbai, Chennai among worst 4 cities in Asia in terms of

Water Availability (ADB)• Illegal Tapping – No Maintenance - Inefficient Use

Sanitation Issues• Sanitation – Not a cultural Priority• Majority of Water Borne Diseases• Community Sanitation still not effective• Commendable Work done by NGOs –• Sulabh International and NRHM (Kalyani)

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PPP Benefits : Water SectorBenefits to Governmentt Benefits to Private Partner

• Monetary Help• Ownership and Policy

Making in hands of Govt• Technical Expertise and

Efficient Management• Better Mobilization of

Resources and Assets

• Policy Level & Statutory Help by Govt

• Help of Govt in resolving problems in Land Acquisiton and Clearnace, Approvals

• Financial Security (Limited Assistance)

Types of PPP• Management Contracts• BOOT Build-Own-Operate-Transfer• BROT Build-Rehabilate-Operate-Transfer• DBFO Design-Build-Finance-Operate Examples from India

• Tirupur• Ghaziabad• Dewas• Vishakhapatnam

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Summary 1. NTADCL

Despite international recognition as a major export centre for knitwear, Tirupur lacks quality infrastructure• –Domestic water supply is limited to a few hours on alternate days• –Industries do not have access to piped supply• –Depleted ground water in the region •Investment in infrastructure is critical for a future Tirupur•A comprehensive program (TADP) was formulated to address the infrastructure needs of the town •Lack of budgetary resources prompted local industry to spearhead implementation of TADP on a commercial format•New Tirupur Area Development Corporation Limited (NTADCL) was formed as the company to implement the TADP

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Summary 2. BOOT Contract Characteristics of the agreement:

• Possibility to extend the concession period (especially if costs not recovered)

• Possibility to set the prices

• Possibility to reallocate the quantities of raw water that must be supplied

• Possibility to make requests to increase the water drawal rights for the industries

• Possibility to use the excess water

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Summary 3. Reach

• 56 KM pipelines from Cauvery River• Distribution Network of 350 KM – Delivering

185 MLD (Extension to 250 MLD)

• 900 Registered Textile Firms, 1.6 Million Residents

• Maintenance of Raw Water and Sewerage Treatment plants

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Distribution Scheme

Industry, 125

Rural Area; 35

Tirupur Municipal-

ity; 25

IndustryRural AreaTirupur Municipality

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Summary 4. Criticism Consequences:

• Prices not adequately set and incentive to increased water use for the industries

• Water quality and supply not satisfactory for the villages

• Contradictions regarding wastewater recycling

• Excess water not attributed to domestic purposes

• Less accountability difficult for regulatory agencies to impose controls

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Case Study: France (1/3)

More than 70% of water supplied by private companies

In theory, high degree of control from the municipalities but some abuses: – Huge profit margins & over-pricing– Huge losses of water in the piped, paid by the users

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France (2/3)

Massive renegotiations of delegation contracts :• In 2009, law introducing a maximal duration of 20

years for the contracts concluded before 1995• Consequences:

- decrease in the prices (ex: 32% in Millau)- new conditions and demands of results- Systems of bonus/malus- ...

New trend of a return to public management

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France (3/3)

Tighter control only possible if absence of corruption

Example of Grenoble:• Concession contract granted to

La Lyonnaise des Eaux in 1989, in exchange of gifts around 3 million€

• Contract finally cancelled in 2000

• Return to public management

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United States

• 85% of water systems operated by municipalities and other government bodies

• 15 % owned operated by the private-sector• Regulated activity

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United States

• Purchase of municipal tap water by water bottling companies

• Why?

– Easier access to municipal tap water

– Easier to negotiate deals with city officials

– Economic decline– Job creation and increasing

tax revenues

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Sacramento, California

• July 2009-agreement between Nestlé & city of Sacramento set

• Nestlé- 30 million gallons of the city's water & 18.9 million gallons of spring water

• Nestlé Pure Life Brand

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Kennebunk, Maine

• Summer of 2008, Poland Springs, a subsidiary of Nestlé Waters North America

• Withdraw 432,000 gallons/day of water from local water district

• 'Save Our Water’ organized by public to protest

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Group Recommendations 1

• Stricter regulations from the beginning

• Monitoring programs and guidelines by an independent group

• Public participation

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Group Recommendations 2

• Capping the rights of Private Companies in PPP by Government

• Subsidies given to Public should not be economically Determined by Market Forces

• Reserve Funds by Govt collateral for PPP should be turned in favor of Public

• Gievance Redreasal System + Proper Documentation = Transparency

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Thank You