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The Maharashtra government plans to bring in private companies to treat tens of thousands of tonnes of municipal solid waste that the state produces every day.
It has instituted a six-month study on treating waste through private help, being conducted by Infrastructure Development Finance Co. Ltd (IDFC) and its associate company Infrastructure Development Corp. (Karnataka) Ltd (iDeCK).
“The study is to see how to go about inviting private players because finance is essential to look at the entire sector in a consolidated manner,” said D.T.V. Raghu Rama Swamy, chief operations officer, iDeCK, a joint venture of IDFC, the Karnataka government and Housing Development Finance Corp. Ltd (HDFC).
The study will cost Rs40-50 lakh and take six months to complete. The World Bank is funding the study as part of a South Asia sanitation programme, Swamy added.
A World Bank spokesperson did not respond to emailed questions sent on Monday.
Maharashtra’s capital Mumbai alone produces 8,000 tonnes of solid waste every day—second only to the national capital, New Delhi, which produces 9,000 tonnes. Across India, 200,000 tonnes of solid waste is generated daily, of which only 5% is scientifically treated.
Open dumping, common in cities such as Mumbai, allows waste to percolate into soil and water. Such contamination can only be prevented by scientific treatment of waste.
The governments of Delhi and Karnataka have started taking private help in scientific waste treatment, while Mumbai has only made some unorganized attempts so far. Not much progress has been made in the rest of Maharashtra either, with the exception of Pune.
Waste management is now beginning to receive due importance in India as rapid urbanization is causing an explosion in the quantities of waste generated, said Sasidhar Chidanamarri, programme manager, environment and building technologies (South Asia and Middle East) at the consultancy Frost and Sullivan (F&S).
“There is immense scope for privatization because governments don’t have sufficient funds,” he said. “Private players would also bring in project management expertise and the technical knowhow with them.”
States such as Maharashtra require Rs10-15 lakh per tonne as a one-time investment for waste treatment and a steep recurring operational expense of 10-15% of the initial investment, according to IDFC estimates.
In contrast, the state government currently spends Rs800-1,000 per tonne every year.
Chidanmarri added there are enough benefits for private companies to participate in waste management through build-operate-transfer or build-operate-own-transfer models. “They charge a fee of about Rs600-700 a tonne from municipal corporations for waste management.”
Ramky Enviro Engineers Ltd, one of the first private firms to enter waste management in India, handles some 800 tonnes of waste every day. Its work includes landfilling, composting, segregating and processing.
“Treatment of municipal waste is at a nascent stage in India though across the globe, solid waste management uses the PPP (public-private partnership) model,” said M. Goutham Reddy, executive director at Ramky Enviro Engineers, part of the Hyderabad-based Rs2,500 crore Ramky Group.
The company estimates the size of the solid waste management market at around $8 billion (Rs37,520 crore).
