Urbanization, Water Supply, and Sanitation in India

The chapter aims to review the state of water and sanitation facilities in Indian cities, and policy interventions undertaken to address inadequacies in the provision of these services. The power-law relationship reveals that greater autonomy in management helps in realizing economies of scale. The chapter also measures technical and scale efficiency in the provision of these services in Indian cities. Estimates of technical efficiency uncover that water and sanitation service providers have the potential to increase service levels by 37 and 48 per cent respectively. Note that most Indian urban water and sanitation utilities are operating at decreasing returns to scale. This implies that services may be charged following the rule of marginal cost pricing. The chapter also finds that there are consumption-metering advantages in improving efficiency of water utilities.