Nagpur Ends OCW Contract: A Setback for Municipal Water PPPs in India
The Nagpur Municipal Corporation (NMC) is set to terminate its long-standing contract with Orange City Water Pvt. Ltd (OCW), marking a significant setback for Public-Private Partnerships (PPPs) in urban water supply in India. The contract, awarded in 2012 to OCW-a joint venture between Veolia Water and Vishvaraj Environment-entrusted the company with the operation and maintenance of Nagpur's water supply system, including a city-wide rollout of 24x7 piped water.
However, over a decade later, service delivery remains inconsistent, with many areas still receiving just 2-3 hours of water per day. More worryingly, non-revenue water (NRW)-caused by leakages, illegal connections, and billing inefficiencies-continues to hover above 40%, undermining both financial and operational sustainability. While OCW was expected to modernize the city's water infrastructure and reduce NRW substantially, the failure to meet these performance targets has triggered NMC's decision to revoke the agreement.
This development raises larger concerns about the viability of PPPs at the municipal level, particularly in essential services like water supply, where public expectations are high but institutional capacity to regulate and monitor private operators remains limited.
Yet, water PPPs are not entirely absent in India. Notable recent efforts include:
- Suez India, which has secured a contract to upgrade water distribution in Kochi, Kerala.
- SPML Infra, one of the largest private water operators in India, which works with state utilities like the Uttar Pradesh Jal Nigam, Bangalore Water Supply and Sewerage Board (BWSSB), and Chennai Metro Water on large-scale EPC and O&M contracts.
The Nagpur experience serves as a cautionary tale-PPPs can falter when contract enforcement, performance monitoring, and institutional accountability are weak. However, successful examples in Karnataka and Tamil Nadu suggest that carefully structured contracts, strong public oversight, and phased implementation models can still make water PPPs viable in India's urban context.
