This is a best prospect industry sector for this country. Includes a market overview and trade data.
Last Published: 7/27/2017

Overview

India is grappling with significant challenges in air, water and waste management.  The legislative framework is strong, but enforcement is relatively weak.  Half of world's 20 most polluted cities are in India, according to World Health Organization’s Global Urban Ambient Air Pollution 2016 database.  About 62 million tons of municipal solid waste is generated each year in the 468 cities of over 100,000 people; only 70% is collected and only 23% is processed or treated.  While 94% of Indians have access to drinking water, just under 40% of the population has access to sanitary wastewater system- a disparity that emphasizes the dire need for wastewater treatment systems.  Almost 63% of municipal wastewater and 40% of industrial wastewater is left untreated and discharged.  India is also one of the largest and fastest growing greenhouse gas emitters.  On the industrial pollution front, 30-40% of India’s industrial units produce sizeable quantities of pollutants.  There are about 3 million small-scale enterprises in the country and most of these are using minimal or no pollution control equipment.  The Government of India has classified 60 industry categories  as highly polluting; these sectors are subject to stringent standards.  The Indian Parliament passed the National Green Tribunal Act in 2010, which led to the creation of the National Green Tribunal.  Its purpose is the effective and expeditious disposal of cases relating to environmental protection.  Orders of the Green Tribunal are driving many of the recent environment management initiatives.

Important environmental sub-sectors include: water supply & waste water treatment; solid waste management; air pollution; monitoring equipment and services; renewable energy and carbon abatement technologies.

The Indian pollution control industry consists of a large number of specialized equipment suppliers, chemical suppliers, engineering-procurement-construction (EPC) contractors, consultants, build-own-operate and transfer (BOOT)/build-own-operate (BOO) operators, analytical equipment and services companies.  The equipment market is dominated by small and medium sized units, manufacturing end-of-pipe treatment solutions.  Local production of pollution control equipment is limited to mainly standard, relatively low-tech equipment.  Major suppliers include the United States, United Kingdom, Germany, Japan, Canada, Australia, Netherlands, and Italy. Most of the leading international companies operate in India. 

Market barriers for export of environmental technologies and services to India include:

  • High tariff - particularly in area of monitoring and instrumentation
  • Fragmentation of the market across region - making it difficult to find an agent or a representative that can truly provide national coverage
  • Price sensitivity in tender - lowest bidder mentality with little assessment of cost/quality trade-offs
  • Limited sophistication of local partners- many of the Indian companies are relatively new to the sector and may not have adequate experience developing and implementing the projects
India’s environmental technologies market including goods and services is valued at $16.3 billion (2016).

Data Table for estimated size of market:
Unit: USD millions
 2015 
 
2016
 
 2017 (estimate)
 
Total Market Size151601630117524
Total Local Production110671190012793
Total Exports243526182814
Total Imports652870197545
Imports from the U.S.202321752338
Exchange Rate: 1 USD = INR 65   

Total Market Size = (Total Local Production + Total Imports) – (Total Exports). 
Figures are unofficial estimates 

Leading Sub-Sectors

Promising sub-sectors in pollution control equipment include:
Sub SectorProjected Growth Rate
Water and wastewater management13-15%
Municipal solid waste management8-10%
Air pollution control6-8%

Water and wastewater is the most promising sub-sector in India’s environmental segment.  This accounts for 26% of India’s environmental technologies industry, and is expected to grow at 13-15% every year over the next five years.  Procurement is almost equally split between government and the private sector projects. However, sales to the industrial sector are growing at a higher rate.  The government is primarily involved in the treatment of raw water, water transmission and distribution and sewage treatment operations.  The private sector industries in power, food and beverage, pharmaceuticals, refineries and textiles sectors are generating immense opportunities for water and wastewater treatment equipment.  These industries prefer advanced treatment technological systems such as reverse osmosis membranes for treating their wastewater.  Industries most regulated among all water user categories.  The water treatment market is gradually shifting from chemical treatment and demineralization plants to membrane technology.  The concept of wastewater recycling and zero discharge systems is becoming more widely accepted as new technologies such as sequencing batch reactor (SBR) and membrane bioreactor (MBR) based treatment gain in popularity.

The municipal wastewater treatment segment is badly in need of capacity augmentation since installed capacity meets only about 30% of the need.  This segment is expected to grow at over 15% between 2015 and 2020, with the market size growing from $3.3 billion in 2015 to $6.8 billion in 2020.  The drinking water treatment and supply segment is expected to reach a size of $9.4 billion in 2020 from the 2015 value of $5.5 billion.  The industrial process and wastewater segment is estimated to reach $2 billion in revenue by 2020, growing at over 20%.

In the municipal solid waste sector, India’s Planning Commission Task Force Report of 2014 estimated that the capital costs for collection and transportation of municipal solid waste and for setting up of approximately 500 engineered sanitary landfill facilities to be approximately $1.7 billion.  This includes the provision of mechanized sweeping in more than one million cities at a cost of $34 million.  New legislation on the subject effective 2016 contains new standards for composition of compost, treatment of leachates, emissions from incineration, and criteria for waste treatment facilities and landfills.  It has created new  opportunities for U.S. waste management equipment and service companies.

In the air quality sub-sector, the Government of India launched the country’s first Air Quality Index in 2015 to initially cover 10 cities and will eventually be expanded to more than 60 cities.  Each city will have 6-7 continuous monitoring systems with Air Quality Index display boards. 

Opportunities

As of January 2016, India had 68 water treatment and transmission, desalination, and industrial reuse projects in the tendering pipeline with a cumulative estimated value of $6.5 billion.  According to India’s Planning Commission, the total capital investment required to upgrade India’s water infrastructure will be $126 billion over the next 20 years.  The Commission estimated that India’s municipal solid waste management sector will require an investment of $3.4 billion, of which 40% will come from the Government of India, 21% from state governments and 39% from the private sector.  Responding to these needs, the Government of India rolled out, in April 2015, the Smart Cities Mission - a $1 trillion urban sector plan to create 100 “Smart Cities” and rejuvenate 500 other cities and towns over the next five years.  Clean water supply, sanitation and waste management, efficient mobility and public transport are important components of this new initiative.   So far, 60 cities selected through a challenge process are poised to implement projects worth $20.3 billion in the coming years.  U.S. companies should position themselves and create local partnerships to take advantage of these opportunities.  The Namami Gange project for cleaning up the Ganga river, for which Government of India has allocated nearly $3 billion expenditure to 2020, also offers opportunities for U.S. companies. 

We advise U.S. companies to monitor the U.N. Development Business, World Bank, Asian Development Bank (ADB), the Japan Bank for International Cooperation (JBIC) websites and publications for soft loan and grant funded project announcements.  These projects offer significant front-end consulting opportunities and the possibility to supply equipment during the project implementation phase. 

Opportunities in the industrial sector are primarily in the 60 Red category industries, including the cement, steel, iron and power industries.  These large end-user industries are buyers for air, water and hazardous industrial waste treatment solutions and have been investing substantially in environmentally friendly production processes. 

Monitoring equipment and services also provide opportunities in both the public and private sectors. 

Web Resources
Ministry of Urban Development
Smart Cities project
National Mission for Clean Ganga
Central Pollution Control Board
Environmental Information System  ENVIS India
National Mission for Clean Ganga
Atal Mission for Rejuvenation & Urban Transformation (AMRUT)
JICA
USAID
U.N. Development Business tenders
World Bank projects
Asian Development Bank projects

For more information about opportunities in this sector contact U.S. Commercial Service Industry Specialist: Arup Kumar Mitra at arup.mitra@trade.gov

Prepared by our U.S. Embassies abroad. With its network of 108 offices across the United States and in more than 75 countries, the U.S. Commercial Service of the U.S. Department of Commerce utilizes its global presence and international marketing expertise to help U.S. companies sell their products and services worldwide. Locate the U.S. Commercial Service trade specialist in the U.S. nearest you by visiting http://export.gov/usoffices.



India Environmental Technology Trade Development and Promotion