Modi’s Nal se Jal water mission a pipe dream or $262 billion opportunity for investors?

By: |
Published: September 27, 2019 2:51:56 PM

As mission Nal se Jal is the most ambitious and perhaps most prioritized scheme for Narendra Modi’s second term, the same may translate into billions-of-dollars opportunity for investors.

It notes that women and children from low-income countries are most affected by the lack of access to water. (Representational image)There are concerns that the Prime Minister’s pet scheme Nal se Jal may remain just a pipe dream due to various constraints. (Representational image)

As mission Nal se Jal is the most ambitious and perhaps most prioritized scheme for Prime Minister Narendra Modi’s second term, the same may translate into billions-of-dollars opportunity for investors as the mechanism to take water to every household has been one of the most under focused areas till now. “Our deep-dive into this space suggests that although there is a case for $262 billion investment over the next three decades to boost water availability,” research and brokerage firm Emkay said in a report. However, the actual spending under the scheme is expected to be gradual, the report added. The government is expected to allocate a maximum of $70 billion through FY 2020-24, against the required $262 billion.

Even then, there are concerns that the Prime Minister’s pet scheme may remain just a pipe dream due to various constraints. While the Modi government set up an altogether new ministry for the Nal se Jal mission, the mission still lacks a clear pathway for its execution. “Our discussions with officials across the Jal Shakti Ministry, state water supply and sanitation departments, companies active in the water sector, and others indicate that there is little clarity on the actual roadmap across the chain as of now,” Emkay said in the report.

Can Nal se Jal emulate Swachh Bharat’s success?

Swachh Bharat Abhiyan, the flagship scheme of Narendra Modi government’s first term, has been a resounding success and the mission overachieved its target of constructing nine crore toilets across India. However, unlike Swachh Bharat Abhiyan, Nal se Jal will face certain challenges which were elusive to Swacch Bharat Abhiyan (SBA). “This is because unlike SBA, the onus of actual construction, land acquisition, connectivity and water availability is on the government,” the Emkay report said. Further, the government also faces funding constraints, which can be taken care of only if investments in other infra sub-sector are paused. There are many fronts to the umbrella Jal Jivan Mission including river interlinking, water and sewage treatment, and irrigation, which also need government capex.

Modi government had announced its ‘Jal Jivan Mission’, which is the umbrella scheme for other programs like ‘Nal se Jal’, during the release of BJP manifesto 2019. The program aims at providing piped water connection to every house by 2024.

Do you know What is Cash Reserve Ratio (CRR), Finance Bill, Fiscal Policy in India, Expenditure Budget, Customs Duty? FE Knowledge Desk explains each of these and more in detail at Financial Express Explained. Also get Live BSE/NSE Stock Prices, latest NAV of Mutual Funds, Best equity funds, Top Gainers, Top Losers on Financial Express. Don’t forget to try our free Income Tax Calculator tool.

Financial Express is now on Telegram. Click here to join our channel and stay updated with the latest Biz news and updates.

Next Stories
1Covid fallout: Spending for these centrally-sponsored flagship schemes to be cut
2ILO concerned over states’ move to ease labour laws, urges PM to intervene
3States’ labour reform moves hit hurdle; Centre may say ‘no’ to key changes