The water sector stands at a major turning point. Alongside ambitious infrastructure growth targets and accelerated expansion, the climate stress is intensifying and there is a nearly 750 billion cubic metre gap between water supply and demand. Against this background, stakeholders are adopting new strategies to conserve, rejuvenate and recharge this dwindling resource.
The past year has witnessed a policy-led transformation, with efforts focused on network efficiency improvement, used-water reuse, digitalisation and decentralised water governance. These initiatives are being embedded in an integrated water management approach, termed “One-Water”, aimed at achieving water security, which is crucial for economic growth, climate resilience and social equity.
Government-led transformation
India’s water sector is entering a phase of transformation as the government adopts a more proactive and evidence-based approach. It is implementing a multi-pronged strategy that blends financial strength with institutional reforms and innovation-driven mechanisms. As a result, during 2024-25, the sector progressed with large budgetary allocations, enabling frameworks to promote private and start-up participation, and efforts to improve network management. A testament to this shift is the increase of 52 per cent in the Ministry of Housing and Urban Affairs’ allocation in Union Budget 2025-26, and an almost twofold rise in the Ministry of Jal Shakti’s outlay. The government’s vision for 2025-26 extends beyond capital infusion. It reflects a stronger recognition of the urban-rural continuum in water resource management and a policy pivot from infrastructure expansion to system consolidation. This was evident in the extension of the Jal Jeevan Mission till 2028, with a focus on operations and maintenance and community participation (jan bhagidari).
The year also saw policy discussions on creating a start-up-friendly ecosystem through procurement reforms, certification mechanisms and a unified innovation portal, with AMRUT 2.0 providing the institutional backbone. The mission’s start-up challenge has already introduced over 500 technologies, while its collaboration platform is helping digitalise projects, geotag assets and integrate real-time monitoring systems.
However, systemic reliability remains a persistent concern, with non-revenue water (NRW), leakages and inefficiencies impacting both financial and resource security. By reframing NRW as unproductive water rather than just lost revenue, the state governments are underscoring the urgent need to plug inefficiencies across the water supply chain.
This new perspective is also shaping state-level actions such as the pilot in northeast Delhi, where 58 per cent of water is lost due to leakages in its ageing 2,800 km network. A consultant-led approach is being implemented to combine technical solutions, billing reforms and institutional restructuring. Meanwhile, the Goa government will leverage the Drink-from-Tap (DfT) scheme to ensure continuous water accountability and accessibility. Its proposal will be reviewed by the central government to provide financial assistance under AMRUT 2.0.
Emerging “new water” concept
Used-water reuse has evolved from being a marginal concept of wastewater discharge to a globally recognised idea of “new water”. It is becoming central to India’s water security strategy, supported by recently initiated regulations and incentives. New policy frameworks such as the Liquid Waste Management Rules, 2024 are redefining accountability by mandating reuse targets, and ensuring financial sustainability through user charges and penalties for non-compliance.
At the programme level, the Jal Hi Amrit scheme, launched in October 2024, seeks to accelerate used-water reuse by incentivising utilities and state governments to enhance treatment quality and systematically expand reuse applications. Under this scheme, cities such as Bengaluru, Delhi and Surat are demonstrating how regulatory support and financial incentives can translate into scalable models. This is strongly demonstrated through the Bangalore Water Supply and Sewerage Board’s 5-star-rated sewage treatment plants and Delhi’s new Water Resource Recovery Cell.
During 2024-25, industries emerged as powerful drivers for recirculating treated used water. In Maharashtra, Gujarat and Haryana, industrial clusters are being planned around zero liquid discharge (ZLD) principles, while the textile sector experiments with used-water reuse certificates to create market-based incentives. Major industrial contracts are now signalling a shift from concept to execution. For instance, GAIL’s recent award to VA Tech Wabag to build a ZLD facility, along with an integrated effluent recycling system at its Pata petrochemical complex is a concrete step towards operationalising industrial water reuse.
Shaping smart pilots into robust digital systems
Over the past year, digital adoption has steadily progressed from ad hoc technology deployment to integrated and system-wide smart water management. Predictive maintenance, real-time monitoring and demand forecasting are now increasingly embedded in urban operations. Under AMRUT 2.0, 380 smart water projects worth more than Rs 230 billion have been approved, while the DfT initiative has implemented over 250 schemes with real-time monitoring capabilities. A growing number of cities are converging digital models with existing systems for efficient service delivery. While cities such as Patiala, Jalandhar and Amritsar are advancing their 24×7 water supply programmes using supervisory control and data acquisition systems and internet of things (IoT)-enabled leak detection, others like Pune are leveraging smart metering to reduce NRW. In addition, digital twins are being piloted at Delhi’s Chandrawal water treatment plant and Mumbai’s Bhandup sewage treatment plant to optimise operations.
Technological innovations are also being implemented to monitor river health and manage urban sewerage. The Pavitra Ganga project uses mobile and stationary sensors for low-cost water quality tracking in rural and peri-urban areas, while artificial intelligence (AI) is being deployed to assist in leakage detection and resource optimisation. In Delhi, automated sewerage recyclers are being piloted to enable used-water reuse and curb waterlogging.
Making room for decentralised, indigenous and natural solutions
The recent focus on localised solutions is bringing a crucial structural change in water governance, making broad policies more practical and easier to implement. This shift towards bottom-up models is not only increasing efficiency in allocation but also building community ownership of water resources. The growing emphasis on decentralisation is visible in states such as Rajasthan and Gujarat, where village-level water user associations have been tasked with managing aquifer recharge and local distribution.
International collaboration has also reinforced this approach. India recently signed an MoU with Nepal to strengthen cooperation in the sector with groundwater monitoring, artificial recharge and rainwater harvesting. This will allow institutionalisation of a regional management model by sharing technical know-how and committing to joint capacity building.
Alongside municipal leadership, academic research is driving innovation. Institutions such as IIT Guwahati, NIT Rourkela and Shivaji University in Kolhapur have come up with ingenious organic methods in the past year for used water treatment. Innovative spherical concrete beads photocatalyst systems, biochar from jamun leaves and mushroom waste and laccase, which is a natural enzyme, have been used to develop low-cost and biodegradable ways of eliminating contaminants from used water.
Shift from mere campaigns to on-ground river clean-ups
Indian rivers, the lifelines of fresh water, are under mounting stress as pollution levels rise every year. Their rejuvenation has become a central imperative for securing the long-term health of the sector. Beyond symbolic clean-ups, efforts over the past year have been concentrated on decentralised sanitation through integrated urban planning and advanced technology deployment. In cities such as Prayagraj, a series of measures has been implemented to achieve ZLD in the Ganga, while hosting large festivals throughout the year. This includes the daily treatment of wastewater from 0.15 million toilets, QR code-based sanitation surveillance and the deployment of 94 suction machines. At the national scale, system-wide river rejuvenation is being promoted, rather than piecemeal interventions. As a part of this approach, the Ind-Rivers Centre of Excellence has been proposed by IIT Delhi. The centre will conduct research and incubate start-ups focused on river health, combining AI-based modelling with urban river management plans.
Binding crisis response to long-term sustenance
Despite steady progress, the sector continues to grapple with deep-rooted challenges, such as high NRW losses of 35-70 per cent in major cities, ageing infrastructure, poor leakage control and fragmented institutional coordination, which dilute investment impacts and slow project execution. Limited technical expertise has further constrained digital adoption, while data deficits and inconsistent assessments have stalled timely interventions.
Addressing these barriers calls for a transition to science-informed, digitally enabled and community-driven governance models. Initiatives such as the Jaldoot app for groundwater monitoring, the CLART platform for recharge site identification and the CoRE Stack platform for tracking watershed patterns demonstrate the potential of localised participation in strengthening national data sets. Embedding climate resilience into water planning, by integrating glacier preservation, flood and drought preparedness, and proactive adaptation, will also be critical. These measures will be complemented by trenchless pipeline renewal, stronger technology partnerships and a centralised data repository.
Ultimately, India’s pathway to water security will depend on its ability to align governance, technology and community action for a sustainable way forward.
Shubhangi Goswami
