Private Participation in India's Water Sector: Impact on Water Access and Service Quality Indicators
Bharadwaj, Ananthi Shankar
Water service delivery is an integral part of India’s development agenda specifically in urban areas. Private sector participation through public-private partnership (PPP) arrangements is a key component of this agenda. However, it is essential that private sector participation is designed to deliver water service that is affordable, accessible, adequate and meets minimum drinking water quality standards. Existing literature suggests that the impact of water PPPs on water access and service varies widely, indicating that project-specific features also determine their overall impact. This paper focuses on the Indian experience with private participation in water supply. Specifically, I attempt to isolate the effect of water PPPs on indicators of water access and service quality in Indian states and districts using difference-in-difference estimation methods. The results of my empirical analysis are inconsistent and ambiguous, reinforcing the importance of project specific features. For instance, household access to main drinking water source is positively correlated with water PPPs at the state level, however, this association is reversed at the district level. In cases where the effect is consistent across the state and district level analysis, the results do not support my hypothesis that private participation positively impacts water access and service quality. For instance, household access to piped drinking water is negatively correlated with water PPPs at the state and the district level. Notably, water PPPs are negatively correlated with adequacy of drinking water supply during all times of the year and the average daily duration of water supply. As such no causal claims are possible.
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