Reforming Delhi Jal Board as the Public Water Utility and Protecting the Right to Water

Dr. Onkar Mittal

Fifteen years ago, when the Congress Government came to power in Delhi, it embarked on an ambitious programme of privatization of public services and utilities in the city – like electricity, water and garbage disposal. In the case of water supply and sewerage, the first step was to set up an autonomous public utility – an autonomous institution working on cost recovering principles, outside the control of the executive apparatus of the Delhi Government and Municipal Corporation of Delhi. Very soon in the process, steps were taken to involve the World Bank to set up a process of incremental privatization of the Delhi Jal Board (DJB). In the wake of mounting public criticism, the Government of Delhi withdrew the application for the World Bank loan in the year 2005. However, its plan for reform has continued to be guided by the road map developed by the World Bank consultant – Price Water Coopers(PWC). The high percentage of Non-Revenue Water (NRW) due to leakage and lack of metering and billing and the necessity of reducing this amount through changes in the distribution network, bulk metering and domestic water connections and increasing water tariffs has governed the agenda of the DJB for the last 10 years. As a result of the action of the past 10 years, the DJB has increased the water tariffs and claimed breakeven in its revenue budget. Partially reversing this quest for cost recovery, the new government in Delhi of the Aam Aadmi Party (AAP) had decided to implement its election promise of providing free water up to the consumption limit of 20Kilo-Liters per family per day. The purpose of this paper is to review the ongoing reform process in the DJB and link this to the larger issue of the right to access drinking water by the residents of the city. It is argued that the dependence of a very large percentage of the population of Delhi on the tanker supply of water is one of the biggest challenges and action needs to focus on this. The conclusions drawn in this paper are tentative and merely for stimulating discussion for further policy change and action on the ground. The scenario in Delhi makes for an illuminating case study of all-India interest. The important issues of access to sanitation and management of waste water – sewage and tapping the traditional water sources and their protection, have not been addressed in this paper. These issues are integral component of work of a public water utility and must be considered for understanding the total picture.


The access to water (and sanitation) has been recently included as one of the internationally recognized human rights. The city of Delhi with its fast growing population is an example of unplanned urbanization which is associated amongst other things with irregular supply and uncertainty in the availability of water for drinking and other domestic needs. Every year in the summer when the water flow of the river Yamuna is reduced, this water crisis becomes very acute. The water situation in city is in some sense a great equalizer in the sense that some of the most posh colonies face the water crisis while some of the slum areas may have a plentiful supply of water. Many of the established areas with piped water supply frequently face the problem of the supply of contaminated water which smells bad and is no good for any use. Ironically, the average per capita supply of water is said to be one of the best in the world cities. A large number of areas have piped water supply, but within that there are many who are still dependent on the private water tankers. At least one fourth of the city gets its supply through water tankers with a quantum of available water supply as low as 3 litres per capita per day, while the city average is said to be 120 litres per capita per day. The thematic audit of Delhi Jal Board points out that 24.8 per cent of Delhi’s population is being supplied with 3.82 litres per capita daily, far less than the minimum stipulated average or the 40 litres minimum established by the World Health Organisation. 49% of water produced, does not generate any revenue (non-revenue water or NRW). This is an unacceptably high level. However, the non-metered supplies through tankers and standposts account for an estimated 8% of water produced, about a sixth of the NRW.

Given the failure of the Delhi government to ensure water supply, close to a third of the city’s residents are thus forced to depend on so- called “informal systems of water supply” meaning private contractors supplying water drawn from bore-wells at high rates. All this is leading to severe public resentment, often spilling out into the streets. It has been estimated that about 200,000 such tube-wells exist. In addition to private tube-wells, there are supplies of DJB bottled water as well as numerous hand-pumps. No consumption figures are available for hand-pump supplies.

Bottled water supplies by DJB are so small as to be insignificant. Nevertheless, 23% of households used such sources for at least part of their water supplies, as revealed by the sample selected for the willingness- to-pay survey carried out under the Study.

On paper, about 12% of Delhi’s water needs are met by groundwater reserves. Unofficially, the figure reaches almost 50%. A recent analysis of groundwater abuse conducted by the Centre for Science and Environment (CSE) reveals that over 2,000 private tankers draw groundwater from tube- wells and sell it to residential localities and industries at exorbitant rates. Their business is pegged at Rs 400 crore annually. Even the latest assessment of groundwater resources carried out by the Central Ground Water Board (CGWB), in collaboration with the state government, says that out of 27 sub-district areas – tehsils – in nine districts, 20 tehsils are over-exploited.

In conclusion, there is a large deficit in the water supply system, partly alleviated by private alternative supplies. Private measures are also prevalent to help reduce the shortcomings of the system.


Till the late nineties the Delhi water supply and sewerage undertaking used to work directly under the Government of Delhi. In the year 1999, the Government of Delhi, on the advice of the World Bank, took the decision to form an autonomous public utility – Delhi Jal Board (DJB), which was to work autonomously on cost recovery principles.

The DJB Privatization Project

The Delhi government had embarked upon a programme of privatisation of the DJB on the utterly misplaced hope created by the World Bank lobbyists that this will solve the water supply problem. Plans to privatise DJB, more or less along the lines of the privatisation of the electricity utility and in keeping with neo-liberal “reforms” advocated by the World Bank and other financial institutions dominated by the USA, have been on the anvil for some time. The Delhi government under both BJP and Congress has been among the more active proponents of privatisation of public utilities, with actual implementation of these policies gaining momentum during the Sheila Dixit regime.

In fact, as we shall see below, even before formulating the privatisation project as recommended by the international consultancy firm Price Waterhouse Coopers (PWC) under World Bank guidance, several measures towards this end had already been taken in Delhi in terms of both piece-meal implementation and preparations for a more comprehensive privatisation of DJB. Now World Bank type thinking has clearly been internalised in various government circles even if the Bank is not actually involved in specific projects.

The Project prepared by the Delhi government and DJB is based on the assumptions that current failures can be overcome by purely managerial measures, that only privatisation in some form or other is the solution and that tariffs must rise, gradually leading to “full cost recovery”. PWC had cleverly recommended that, since total privatisation in terms of handing over ownership would not be acceptable, the same goal should be achieved through unbundling, giving management contracts for different activities to private parties and, to the extent possible, by government raising tariffs to desirable levels before the privatisation commences so as to protect the private players from public resentment. Unbundling of the utility, in this case implying supply of raw water, treatment and bulk distribution, and retail distribution each being handled by different parties, has always been the precursor to privatisation as with electricity in Delhi and elsewhere.

For years, the DJB has appointed contractors to handle repairs and maintenance of various parts of the supply system with no transparency as to contract terms or award modalities, no accountability in terms of performance or deliverables, and no positive impact on reducing pipeline losses.

As a beginning towards unbundling and privatisation of the water utility, the Delhi government had set up the Sonia Vihar water treatment plant with 145 MGD capacity, ostensibly to make up for Delhi’s water shortfall. The plant is to be operated by the Ondeo Degremont, a subsidiary of the French multinational Suez Lyonnaise with guaranteed high returns and huge backdoor profits in terms of a plethora of “incentives” in terms of relaxed performance parameters, lowered power charges and so on, while penalties for underperformance remain unspecified and non-transparent. Payments have been for the construction work by the Delhi government as per Degremont’s bloated specifications. Interestingly there is a cost escalation of over 300 per cent! Worst of all, the plant continues to lie idle since the Delhi government has been unable to ensure supply of raw water from UP and is running up penalties of over Rs 1 lakh per day as per the terms of the contract.

The Project envisaged that management contracts will be given to private parties ostensibly with performance targets, incentives and penalties but with complete lack of transparency. All capital expenses were to be incurred by the DJB according to requirements specified by the Contractors and Consultants appointed for the purpose. Tariffs were to be set by a Regulator whose task, significantly, would include “facilitating” privatisation and “ensuring remunerative returns” to service providers; in other words there is a built-in bias towards the private contractors. Importantly, as the PWC had recommended, much of the tariff rises have already taken place, having increased by 200-300 per cent for most consumers in Delhi even before the privatisation Project. In similar World Bank assisted projects in Chennai, Hyderabad, Bangalore and Mumbai, tariffs range from Rs 5 to Rs 10 per klitre compared to Rs 3 for higher brackets in Delhi now, raised from Rs 1 earlier. Metering and collection of revenues in any case were also to be the responsibility of the DJB under the Project. Then the DJB has been assigned the “dirty” job while the contractors sit back and collect fees and bonuses.

All performance targets assigned to contractors are based on a presumption of adequate raw water supply by the DJB, failing which, as is most likely in the given scenario, the contractor is absolved of all performance obligations and targets, as with the Sonia Vihar plant. In all the hue and cry over this white elephant, no one has blamed the MNC while all have targeted the Delhi government. The management contract system serves therefore only to absolve the private parties of any responsibility, deflect criticism and to disguise the real privatising nature of the process. Private contractors will control the utility and make profits without any accountability while the DJB will be held responsible for failures.

Withdrawal of the loan application to the World Bank for the privatization project, yet the DJB continued to be guided by the recommendations of the World Bank consultant PWC.

In the year 2005, amid a mounting storm of public criticism of the Delhi government’s plans to privatise the water supply, coming on top of a wave of public protests against the hugely negative impact of electricity privatisation, the Delhi Jal Board announced the withdrawal of its loan application to the World Bank for a project under which the proposed restructuring of the water utility was to take place.

This was a significant victory for all those who had been campaigning against these moves.

It also sends a strong message to other metros and cities and is a blow to the privatisation mania that seems to have gripped the ruling establishment and sections of the elite classes.

Though the citizens of Delhi were spared such tortures, this relief was only to be short-lived. There were no indications that the temporary reprieve for Delhi represents a retreat on the policy front. Further, Delhi’s water woes still remain to be addressed.

While announcing retraction of the loan application to the World Bank and putting in abeyance the privatisation Project submitted to it, the DJB authorities have simultaneously stated that they would implement many of the recommendations of the PWC Report and also the Delhi government’s favourite so-called “24x7 Scheme” under which regular water supply would be provided in two zones of Delhi. While it has not been made clear whether or not some “outsourcing” would be entailed in such exercises, the point is that schemes such as “24x7” are completely misplaced and will provide absolutely the wrong lessons for subsequent Delhi-wide extension.

Given present constraints on water availability in Delhi, “24x7” supply to some parts of the city can only mean diverting water from some other part of the city. Obviously, some privileged zones would get round- the-clock supply at the cost of poorer or politically less sensitive areas. The problem of inequitable distribution of water will get exacerbated, with higher-income areas and bulk consumers, willing and able to pay higher tariffs, getting more water than lower-income residential areas. Such a scheme will set a dangerous precedent for the future.

Privatization and threat of unsustainable groundwater extraction

In Delhi, the floor area ratio (FAR) of residential properties has been progressively increased in league with the builder mafia, leading to huge increases to occupancy without any increase in water supply, straining the already over-stretched water supply system to the breaking point. New upper-income residential colonies and water-guzzling commercial establishments such as shopping malls, commercial complexes and private hospitals have been allowed to come up in water-stressed areas. There have been no efforts towards demand management or the many feasible measures to reduce water usage as have been adopted in several countries.

No measures have been taken to augment groundwater through recharge provisions and large-scale rainwater harvesting. However, construction activities in the Yamuna riverbed, the ridge, flood plains, and neighbouring areas have been destroying existing natural and man-made structures which could recharge groundwater.

Trade in groundwater in India has already reached a horrendous level of Rs 3000 crore annually. Private tankers abound and farmers holding lands surrounding large cities are giving up agriculture to take up extraction and sale of groundwater, which is not theirs just because the bore-well is located on their lands. In Chennai, private water tankers today are estimated to meet almost 10 per cent of the city’s water requirements despite the World Bank guided corporatisation of the water utility. In fact, the World Bank, as a matter of policy, encourages such private exploitation of groundwater. Many World Bank-financed projects in Colombia, Paraguay and Senegal have supported small-scale water entrepreneurs. The World Bank, though it supports private enterprise in groundwater extraction and distribution, has argued that “suitable regulatory mechanisms” could promote optimum use of water.

It is also highly likely that, in the face of public protest at the diversion of water from other areas, and to overcome poor availability, withdrawal of groundwater will be enhanced, with disastrous consequences for Delhi’s future. The DJB has already sought to transfer to itself powers of the Central Ground Water Board, the custodian of the sub-surface waters which are a public good, so that the DJB can indiscriminately withdraw groundwater. With privatisation in any guise private contractors will increasingly withdraw groundwater. Then pressure on groundwater will only intensify with the DJB itself.


Issues for reflection

Need for a new analytic framework and categories: In our view, new political activists will have to get on top of the road map of reform, as defined by the DJB under the previous government and change this road map in the right direction. This is the most essential first step in the incremental process and long struggle to achieve the right to water for the city residents, particularly the poor. The civil society and new politics, aiming for system change and not merely for change of government have to reflect and debate on some of the following to develop a new paradigm and praxis: – (i) how do we define water scarcity. The city government raises the bogey of water scarcity – is water scarcity a problem or is the real problem rational water distribution in different city areas?; (ii) how do we identify areas which have genuine difficulties and may not get piped supply due to terrain or other difficulties in laying pipelines and other areas which have been deliberately made tanker dependent, either due to withdrawal of excess water from the pipelines by the citizens themselves or mismanagement of water distribution by the DJB; (iii) how do we define need for supplying ‘free water’, – in many cases, people may want Piped Water Supply and even Water Meters and be willing to pay – but the DJB may not be willing – as it will legalize and provide them the right to demand piped water from DJB; (iv) how to focus the debate and civil society challenge on institutional arrangements – nuts and bolts of working of the state institutions and mechanisms of change, in this case the Delhi Jal Board-DJB – who actually exercises power – is it engineers, bureaucracy or the contractors?; mechanisms of Community control at four levels – mohalla, ward committees, district and State-DJB; giving control to MCD instead of the Delhi Government, etc.

Privatization Threat: The government of Delhi may have decided 10 years ago to drop World Bank funding, but the threat of creeping privatisation under various guises still looms over this metropolis and other cities in India. Residents of Delhi and other prime locations in India will have to be extremely vigilant and guard against the many ways in which their right to efficient equitable water supply may be challenged, while the very nature of water utilities as a public service based on sustainable utilisation of a public good is sought to be undermined. The problem is that unplanned and unsustainable water use, and its privatisation, continue to remain on the neo-liberal agenda in India. The National Water Policy of the erstwhile Bhartiye Janata Party-BJP/National Democratic Alliance-NDA Government (1999-2004), was also invoked by the DJB in support of its privatisation plan under the Congress government of Delhi. This policy explicitly states: “Private sector participation should be encouraged in planning, development and management of water resource projects for diverse uses wherever feasible. Private sector participation may help in introducing innovative ideas, generating financial resources and introducing corporate management and improving service efficiency and accountability to users. Depending upon the specific situations, various combinations of private sector participation in building, owning, operating, leasing and transferring of water resources facilities, may be considered.” Even if this or that privatisation project such as that of the DJB is withdrawn from the overt clutches of the World Bank, this Damocles sword still dangles over our heads.

Free Water an essential component of Right to Water?: In the last fifteen years, despite the measures adopted by the Congress government of Mrs. Sheila Dixit, the residents of the Capital city of Delhi have continued to face water woes. The DJB had inflicted a 400% water tariff increase in 2010 and made an annual 10% water tariff increase a norm. After the elections to Delhi Assembly in November 2013, the new government in Delhi of the Aam Admi Party (AAP), announced the implementation of its election promise of provision of free and sufficient quantity of water to Delhi residents. Every resident of Delhi was to get 200 litres of water per day and consumption below this level was to be free of charge. This measure of provision of free water for 20Kl/month/family has been widely welcomed by the civil society organizations and the public at large as a bold and correct decision. India is a signatory to the 2010 UN Declaration on the Right to Water and Sanitation but nothing has happened in terms of making it a reality. Delhi is the first state/city to meet our national commitment. However, some sections have disputed the good intention and wisdom of this pronouncement. According to this view, this action reflects the short-sighted vision of the AAP government and does not take into account the difficulty of metering by the domestic consumers in the slum areas and ground reality of those households who do not have piped water supply. It is important that free water is provided to those who need financial protection, but this is not the priority step to achieve the objective of ensuring the right to water for the city residents, particularly the poor who are dependent on the private tankers for the water supply.

Right to Water through Urban Swaraj: some possible steps

i. Strengthen the DJB: Conduct an assessment for additional staff requirement of the DJB to serve as a public utility and not as a commercial contract management agency as it has now become. Increase technical and non-technical staff, particularly line staff who can service faults and complaints. The deeply entrenched corruption in the government bureaucracy and political culture is another big barrier in reforming the utility. Have separate units for monitoring and fraud prevention. Increase transparency and public scrutiny.

ii. Cancelling the 3 Public Private Participation (PPP) agreements with private agencies. Stopping all wasteful capital infrastructure relating to setting up of District Metering Areas underground water tanks for private distribution of water.

iii. Establishing mechanisms of people’s control over the public utility is the most important action to make the public utility like the DJB an effective and efficient instrument for fulfilling the right to water. Establishing empowered mohalla sabhas may be an important mechanism in this direction but it is an inadequate response to this challenge. In the city of Delhi, with its very large size and increasing population, multiplicity, overlapping and fragmentation of governance mechanisms, real challenges of establishing urban swaraj. Need to link the mohalla sabhas to the governance of ward committees, Municipal Corporation, district administration and many public and private utilities in the city.

iv. Local Action Plan for access to water and sanitation: each locality will have to develop its own action plan and fight for its implementation. Creating a social accountability division within the DJB to support this process by mohalla sabhas and at the same time to address grievances and complaints by individuals, Mohalla Sabahs and Resident Welfare Associations (RWAs).

v. Do a water consumption audit of slums and unauthorised colonies to determine their water consumption. If it is less than the 20Kl/ month/household then there is no need to install water metres in the slums, unauthorised and resettlement colonies of Delhi. This will be a wasteful expenditure

vi. Revive public hand pumps and free facilities for drinking water in public places – ‘piaos’, in all areas, to provide free water to the public. Announce a policy decision allowing people to dig hand pumps and bore wells for public water consumption, wherever the ground water is available in plenty.

vii. Given Delhi’s dependence on river and canal waters from other states, the Central Ground Water Authority has proposed several measures to augment water supply through sustainable utilization of groundwater from areas of natural recharge. None of the above issues figures even remotely in the now withdrawn DJB Project or in the future official thinking which deals only with distribution of water. The present thinking about improving water supply is concerned with superficial tinkering with distribution management and tariff structures. It is essential that in Delhi, and in other metros and cities, a comprehensive plan for improving water supply is drawn up including such institutional restructuring as may be necessary but with full participation of citizens and all relevant planning and other statutory bodies such as CGWA.

The author is a social and political activist in Delhi. This paper is an abridged version of a longer monograph under preparation on this issue.

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