Kotak Insights | Date 10/08/2024

In the book titled ‘Be Water, My Friend’ – Bruce Lee illuminates his most powerful life philosophies by relating them to water.

Bruce Lee's most famous lesson to us was, "Be water, my friend."

He understood that we could learn from the nature of water to lead better lives. This insight struck him during a moment of frustration while he was on a boat in the South China Sea. In anger, he reached over to punch the ocean and realised the profound wisdom of being like water.

Later, he wrote in his journal:

“Had not this water just now illustrated to me the principles of Kung fu? I struck it, but it did not suffer hurt. Again, I struck it with all my might—yet it was not wounded! I then tried to grasp a handful of it, but this proved impossible. This water, the softest substance in the world, which could be contained in the smallest jar, only seemed weak. In reality, it could penetrate the hardest substance in the world. That was it! I wanted to be like the nature of water.”

This is the basic way of water. It is unstoppable. Like everywhere else around the world, water is a critical resource in India and essential for agriculture, industry, and daily life.

With a growing population and increasing demand, effective water management is crucial for sustainable development.

The Indian Budget often reflects this priority through significant allocations to water-related projects and infrastructure, aiming to enhance water supply, sanitation, and irrigation systems.

But this year’s Budget allocation was quite different… it set the stage for the industry to boom.

The budget earmarked substantial funds for many initiatives like the Jal Jeevan Mission and the Atal Bhujal Yojana, which seek to provide piped water to every household and enhance groundwater management in India.

These investments aim to address water scarcity and quality issues and stimulate economic growth by improving agricultural productivity and supporting industrial activities.

That’s probably why the total budget allocated for the Department of Water Resources, River Development, and Ganga Rejuvenation has increased by 55% from last year's allocation.[1]

Running Out of Groundwater?

The latest push for water infra couldn’t have come at a better time. India’s water crisis is reaching a critical point, and the gap between demand and supply is increasing.

In one of its reports, NITI Aayog identified 21 major Indian cities[2] as in immediate danger of depleting their groundwater resources.

As of 2016, approximately 55% of India's rural population had access to piped water[3], while only 15% had household connections.

The government's 'Nal Se Jal' scheme aimed to provide piped water to all households by 2030.

Furthermore, additional water infrastructure programs are in progress: Namami Gange, which focuses on cleaning the Ganges River; a project to develop inland waterways; and Pradhan Mantri Krishi Sinchayee Yojana, which aims to enhance irrigation.

The Biggest Beneficiaries

These budgetary allocations directly influence companies involved in the water infra space—water treatment, water supply, etc.

Enhanced funding and supportive policies can increase these companies' projects and contracts, boosting market performance.

Some of the companies involved in this space include –

• Supreme Industries – Supreme Industries is among the leading manufacturers of plastic products, with a significant presence across piping, packaging, and industrial and consumer product categories. Each of the water infrastructure programmes we discussed above involves the use of PVC piping systems, so Supreme is an obvious beneficiary.

• NCC — NCC Limited (formerly Nagarjuna Construction Company) is a prominent construction and infrastructure enterprise in India. The company engages in diverse projects, including buildings, roads, irrigation, and water supply. The recent budget’s significant investments in sectors such as irrigation or water supply structures can lead to new contracts and projects for NCC.

• Jash Engineering is another player in the water and wastewater industry. It specialises in designing and manufacturing a wide range of water treatment and distribution equipment. The company produces products such as sluice gates, knives, gates, and various valves, which are essential components of water and wastewater management systems.

Then there’s

• VA Tech Wabag, the most important company in this space. It’s a global leader in the water treatment industry, specialising in designing, constructing, and operating water and wastewater treatment plans. The company provides municipal and industrial clients with solutions that address critical water management, purification, and recycling needs.

• Ion Exchange is another premier player in water and environment management. It offers comprehensive services, including designing, manufacturing, and operating water treatment plants, supplying specialised chemicals, and consulting services. It caters to various industries, including pharmaceuticals, food and beverages, power, and municipal sectors, ensuring clean and safe water supply and effective waste management.

From the smaller counterparts,

• Srikalahasti Pipes is a leading manufacturer of ductile iron (DI) pipes in India catering to the water and wastewater infrastructure sector. The company produces high-quality DI pipes for various applications such as water supplies and irrigation.

In addition to these companies, some others, such as PNC Infratech, Thermax, KNR Constructions, EMS, and Teerth Gopicon are seriously trying to improve India’s water infrastructure.

In Conclusion

It’s about time the government takes measures to improve holistic water treatment in the country.

In 2019, just over 30 million out of 190 million rural Indian households had tap water connections. However, by early 2024, 145 million households had tap water access. This translates to an average of over 20 million new tap connections yearly.

The percentage of rural households with tap water connections has skyrocketed from 16.69% in 2019 to 75.18% by 2024, marking a remarkable policy success of Har Ghar Jal in India.[4]

Complex problems like the water crisis can’t be solved with magic bullets. Many different things need to go right, meaning various groups need to work together.

Let’s work together like our country depends on it.

Happy Learning!

Sources and References:

1. ECONOMICTIMES
2. PIB
3. NIRDPR
4. ORFONLINE

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