Chandrima Mukhopadhyay, India
Govt of India recognized the term ‘start up’ in April, 2015, which started as private sector initiated business models by small-scale, for-profit private sector actors. One of the defining criteria is
that: ‘It is working towards innovation, development, deployment, and commercialization of new products, processes, or services driven by technology or intellectual property.’ A scheme to easily register as startup was also introduced in January 2016. From here, I will pick up two words for the rest of the blog: one is innovation, and the other is commercialization of new product.
Piramal Sarvajal is a startup in water sector. For them, innovation is defined as using smart technology to deliver drinking water, and the initiative is about commercialization of water, which is fundamental to human survival. The company is based in Ahmedabad, Gujarat, and serves 12 states mainly in the northern and western part of India as of now. There are other initiatives like them (in Pune, Bengaluru, and outside India). My interest in writing the blog comes from my interest in private sector intervention in infrastructure, in understanding water as a public good, and understanding fresh water being the most easily depleting resource. To evaluate the viability of their business model, such private sector companies forecast the demand of their services based on the logic of number of people migrating to urban India from countryside in next 50 years, rising demand of water based on increased population and climate change as days get warmer, and people being in need of such kind of enterprises for survival. Interestingly, such initiatives are promoted as ‘survival strategy in urban India’ (here).
The phrase, ‘piramal sarvajal’ is in Sanskrit, and means ‘safe water for all’. The company started from a village in Rajasthan, a state in the western part of India in 2008. Water was a scarce resource in Rajasthan, which is dominantly part of Thar desert. The region used to have rain once in three to four years. Indira Gandhi Canal project was a central government initiated ‘desert-greening’ project. It makes absolute sense to start with a water supply project in a village in the state of Rajasthan where water is not just a resource, but it means life. The company grew since then. They currently operate 175+ water ATM units across the country, and 350+ water purification plants and serve 280,000 people on a daily basis. They cover varying kind of spaces and public buildings, such as villages, slums, public spaces, hospitals, schools and government projects. Covering a wide range of public spaces and buildings contribute towards viability of their business model by increasing number of target population with little additional investment. As they mention, with a fair initial investment, one would start getting back expected revenue in five years.
Technology and Partnership
One main feature of the company is use of ‘water ATMs’. Water ATMs are like normal money withdrawal machines, where you insert a prepaid chip card, and collect the definite amount of water you pay for. Sarvajal uses cloud server, that help them allowing the users use ATMs in any city. As the data is not stored in a local server, but a cloud server, users’ information can be accessed from any city in India. Interestingly, a ‘Sarvajal card’ becomes one’s identification of authenticity (like a passport) to have access to drinking water. Besides ATM, other technological features used by the company for water purification are here. Piramal Sarvajal uses various kinds of partnership models include foundation funded, franchise funded, corporate partnered-adopt a village, and government partnered-PPP project.
How do they promote themselves?
-They put strong emphasis on ‘under-served area’ (not served by the government) ‘safe water’ (improved quality control than public sector), ‘innovation’ (using technology, Water ATM is a unique concept itself).
-Safe water for all, inclusiveness [However, their restrictions are: good network connectivity as it uses cloud computing; cash-rich population as they have to use a prepaid card]
-Various models and various technologies (customized for different scenario)
-Recognized by International R&D organisations (quality assurance)
In my opinion, models like Piramal Sarvajal are innovative in many ways such as smart technology (water ATMs, use of cloud server) to solve contemporary urban issue, finance (corporate-adopted), and institutional arrangement. As had been mentioned by a student, innovation has a temporal dimension. Also, due to their entrepreneurship, only private sector actors would come up with such innovation, as these are business opportunities for them. However, such models are fragmented, and to certain extent less-regulated. Moreover, such models are mere business models for private sector, which is of concern considering water is central to survival of life. The structure of Piramal Sarvajal nicely explains the governance of water supply, if one considers ‘governance’ as ‘how things get done’. Considering water is commercialized and sold out as a product, there is a very clear line of production. There is of course varied understanding of what ‘governance’ is (here). If governance is defined as ‘government and beyond’, which is rooted in the context of India, such models of water delivery without any kind of government intervention or control, become highly questionable. Here question could be raised about government’s changing political position behind promoting for-profit initiatives in sectors like water. The more such companies promote themselves on the ground of inclusiveness for access to drinking water, it becomes evident that the state has created a vacuum that is being filled up by private sector.
The wider debate
-Should we pay to have access to water as a citizen? Currently the government has accepted the position that citizens pay. Some even use the word ‘water manufacturer’ in cities like Bengaluru, where by ‘manufacturer’ they indicate those who dig a well, take out water and purify the water for delivery. Of course, no one is manufacturing water (H2O) in real sense. So-called water manufacturing is a profitable business with little initial investment. Some, of course, understand manufacturer as manufacturer of water purifying machines.
-What should be the responsibility of the government in quality control of water? One interviewee mentions, the companies are bound to set up certain technological features to assure water-purifying system. Private sector actors claim they have better water purifying system than the government. Government on paper could audit their set up to check control on quality. However, as mentioned by an interviewee, the government seldom does this until and unless the media attracts their attention.
-Should this raise a concern about water security, in terms of access to safe water for all, especially in time of crisis? Another question emerging out of the third question itself is that who have access to ground water, which is one of the main sources of fresh water, considering access to ground water table is territorial in nature. The concern is that in time of crisis those who only can afford would have access to drinking water, as private sector models are at the end of the day mere business model.
The purpose behind writing the piece is neither to blame the private sector actors for their innovation, nor to be merely involved in a political debate. The concern is more about scientific truth about climate change, the degree of responsibility to be taken by the government, and concern about the vacuum created by the government. It may be subject to discussion whether the state participate in the process as a provider, a regulator, a facilitator, or even a licensor in assuring everyone’s access to safe drinking water. If such less-regulated and fragmented infrastructure delivery models are to be encouraged, if one has to carry a prepaid card to access safe drinking water, that would have a strong implication for the future of Indian cities.
Acknowledgement: I and my colleague had invited Piramal Sarvajal for a session in a course on ‘Private sector in the city making process’ in Winter School 2015 as part of SWS at CEPT University. I am grateful to Piramal Sarvajal for their consent on using their material for the blog and subsequent question and answer sessions.