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Summary
As we stare at water stress in the not-too-distant future, boosting our capacity to treat and reuse water offers an ecologically sound and economically prudent path to water security. We need an end-to-end plan action plan that even covers human psychology.
Water is life. Our lives, environment and livelihoods depend on this vital resource. As we aspire to a new India, we stand at a crossroads in our water management journey. The way we manage it will shape the future of our villages, cities and people. India’s annual per capita water availability declined to 1,486 cubic metres in 2021 and is projected at 1,367 cubic metres by 2031. The ‘water stress’ threshold of 1,700 cubic metres has already breached and we are approaching the ‘water scarcity’ benchmark of 1,000 cubic metres per head.
With climate variability and increasing freshwater demand, it is time to think beyond conventional sources.
Challenges: Nine of India’s 20 river basins are water scarce. Our groundwater use is more than that of the US and China put together, and one in four blocks is exhibiting groundwater stress. Our water-use efficiency in the irrigation sector is about 38%, below the world average of 45%. This is compounded by difficulties in the recovery of operational and maintenance costs. In urban areas, water supply systems suffer losses estimated at 39% of their total—called ‘non-revenue water.’
These challenges are amplified by climate change, which reduces rainy days and concentrates precipitation in shorter periods. The pattern triggers a cycle of floods followed by water scarcity.
The promise of recycled water: India’s urban areas alone generate nearly 72,000 million litres per day of sewage, yet only about 27,000 million litres is treated daily. A 2023 study by the Council on Energy, Environment and Water (CEEW) estimated that if treated water is used for irrigation alone, it could irrigate 1.38 million hectares, generate ₹96,600 crore in agricultural revenue and recover nutrients worth ₹5,000 crore. That is over $11 billion of potential value waiting to be tapped.
Treated water sits at the intersection of health, sustainability and development. It can reduce freshwater withdrawals, ensure reliable water availability for cities and farms, support industrial growth and ameliorate groundwater stress through recharge.
The Prime Minister’s directive at the third Chief Secretaries Conference (2023), as a start, urged states to promote the use of treated wastewater for horticulture and vegetable cultivation within a 10-50km radius of peri-urban areas. The government’s Amrut scheme is encouraging states to reuse 20% of domestic treated water and 50% of industrial effluents.
A few utilities and municipalities have undertaken commendable efforts in the reuse of treated water. Islands of excellence include Bengaluru Water Supply Sewerage Board, Surat Municipal Corporation, Chennai Water Supply and Sewerage Board, Nagpur Municipal Corporation and Prayagraj Municipal Corporation. These efforts must be scaled up nationwide.
The challenges to be addressed include creating infrastructure, ensuring consistent effluent quality, financing, tariffs and incentives, social acceptance of water reuse and robust monitoring and liability frameworks.
In cities where dedicated treatment facilities are operational, treated water is often wasted on account of low demand. Community outreach efforts and engagement programmes could help increase demand through structured memoranda of understanding (MoUs).
Policies: The National Water Policy (NWP) of 2012 emphasizes the recycling and reuse of water as a general norm. Currently, only 11 of our 36 states and Union territories have crafted policies for treated waste-water reuse. This gap needs to be bridged. All states must develop comprehensive policies that clearly articulate their scope, standards, financing mechanisms and maintenance protocols. A robust monitoring system, implemented through existing institutions, is essential to build community confidence and overcome the psychological ‘yuck factor.’
From waste to wealth—Create a circular water economy: Treated water exemplifies the principles of a circular economy. For our urban water supply utilities, it represents a blessing. Rather than viewing wastewater treatment as a compliance requirement, they should see it as an opportunity to diversify their water portfolio. By enhancing treatment capacities and quality standards, these utilities can create reliable secondary water sources and thus benefit from new revenue streams.
Reduce the rural-urban reuse gap: As India’s development paradigm demands that we bridge our rural-urban divide fast, the ministry of jal shakti should assess rural waste water generation, ensure implementation of identified treatment techniques and make it available for alternative uses. The gap between urban and rural areas in the use of treated water could be bridged by providing panchayats with additional finances.
The emerging digital thirst: Data centres demand huge amounts of water for cooling. The US 2024 Data Center Energy Usage Report mentions that US data centres consumed 66 billion litres of water in direct use. It is estimated that a data centre of 1MW capacity consumes 26 million litres a year of water, enough to meet the annual household requirement of about 460 persons in an urban area.
With India’s data centre capacity likely to rise nine-fold to 9GW by 2030, using consistent-quality treated used water for data-centre cooling can prevent depletion of freshwater.
The country’s long journey ahead: Today, as we stand at a critical juncture in our nation’s water management journey, we must look beyond conventional approaches. The solution to our water challenges may well lie in treated used water, an untapped national resource with transformative potential when it comes to water security in the future. This is not an option. It’s an imperative.
The journey ahead will demand both technological innovation and behavioural transformation. Treated used water offers a path that is environmentally sound, economically prudent and aligned with our Viksit Bharat goal by 2047.
The author is a member of the Niti Aayog.

4 weeks ago
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