The Business of Waste 

I once caught an investor digging rather intensely into a slice of our aptly blue-coloured cake at a Toilet Board Coalition event. Figuring it was the perfect moment to strike; I slid into conversation and casually brought up wastewater treatment. He raised an eyebrow and said, “Sanitation? I don’t know… doesn’t really sound investable. Especially wastewater—sure, there’s potential, but how do I know if these businesses can generate real revenue?” 

I grabbed a spoon and gave him my go-to pitch. “Wastewater has three kinds of returns. First, from operating the treatment plant itself—there’s solid infrastructure and services revenue. Second, the treated water becomes an asset you can sell or reuse—especially in agriculture and industry. And third, there’s the environmental value—nutrient recovery, carbon reduction, cleaner rivers—all of which are increasingly linked to financial outcomes through ESG metrics.” I emphasised ESG metrics and carbon reduction—factors increasingly driving investment decisions. He wasn’t yet fully convinced, but he wanted to come to our next event—if not for the wastewater, then at least for the cake.  

Hungry investors apart, India’s wastewater treatment sector represents a vast and largely untapped investment opportunity, both in terms of environmental impact and direct financial returns. Urban India generates 72,368 million litres per day (MLD) of sewage, yet only 28% of this is treated and reused. The remaining untreated wastewater contaminates critical ecosystems, exacerbating health and environmental risks. Simultaneously, India generates 160,038 tonnes per day (TPD) of solid waste, with a collection efficiency of 95.4%, but only half of this waste is treated. These figures point to significant inefficiencies in resource management and signal a massive market potential for private sector players to offer scalable treatment solutions. As demand for clean water rises alongside urban growth and climate pressures, wastewater treatment becomes both a necessity and a commercially viable sector. 

The financial opportunity in treated wastewater reuse (TWW) is particularly compelling. In 2021, India had 11,622 million cubic metres (MCM) of treated wastewater available for reuse, which is projected to rise to 15,288 MCM by 2025 and 35,178 MCM by 2050. If reused for irrigation, the TWW available in 2021 alone could have generated INR 966 billion in agricultural revenue by enabling the production of 28 million metric tonnes of horticultural crops. This reuse could have irrigated 1.38 million hectares—nine times the area of New Delhi—while reducing reliance on freshwater and synthetic fertilisers. Additionally, nutrient recovery from TWW could have saved over INR 50 million in fertiliser costs in 2021, with 6,000 metric tonnes of recoverable nutrients contributing directly to sustainable agricultural inputs. These numbers point to the strong return-on-investment potential for businesses operating across the value chain—from wastewater infrastructure and treatment technology to agricultural reuse and by-product recovery. 

Moreover, the market valuation of treated wastewater itself is a rapidly growing asset class. In 2021, the treated wastewater available held an estimated market value of INR 630 million, projected to rise to INR 830 million by 2025 and INR 1.9 billion by 2050. These valuations do not yet include the downstream savings and earnings from reduced groundwater extraction, lower fertiliser use, and avoided health costs due to cleaner water systems. Reusing TWW in irrigation alone could have reduced greenhouse gas emissions by 1.3 million tonnes in 2021—demonstrating environmental co-benefits that further de-risk investment.  

Wastewater treatment in India offers significant economic potential—both in the capital investment and job creation associated with building and operating treatment plants, as well as in the monetisation of the treated water itself. The sewage treatment market, valued at INR 7,000 crore in 2020, is projected to grow at a compound annual growth rate (CAGR) of 10–12%, spurred by regulatory mandates, rising urban demand, and industrial water stress. Investment opportunities span across capital expenditure for constructing plants (at an average cost of INR 2.5–5 crore per MLD), as well as recurring revenues through O&M contracts, EPC projects, and PPP models. According to India Infrastructure Research, state-level plans such as Namami Gange and AMRUT have already created momentum, with over 850 MLD of capacity under construction and an additional 1,200+ MLD in the bidding stage as of 2022. 

Furthermore, the industrial reuse market is beginning to mature. Several thermal power plants, refineries, and large industrial estates have already begun purchasing treated municipal wastewater through long-term bulk supply contracts. According to CEEW, the price of treated water varies from INR 15 to INR 45 per kilolitre, depending on the region and application, making it an increasingly viable substitute for freshwater. By aligning municipal supply with industrial demand, cities can generate long-term revenue streams from waste that would otherwise pollute rivers and groundwater. With the right policy incentives, tariff structures, and viability gap funding, wastewater treatment is emerging not just as an environmental imperative but as a robust financial opportunity. 

Investment Potential 

Investing in wastewater treatment plants and startups in India presents a compelling opportunity driven by escalating demand, supportive government initiatives, and significant market growth potential. According to a 2022 Frost & Sullivan report, India’s water and wastewater treatment market is projected to grow from USD 1.31 billion in 2020 to USD 2.08 billion by 2025, reflecting a robust compound annual growth rate (CAGR) of 9.7%. Additionally, the wastewater treatment plants sector is expected to reach USD 4.3 billion by 2025. This growth is fuelled by increasing urbanisation, industrialisation, and the pressing need for sustainable water management solutions. Government programmes like the Jal Jeevan Mission and the National Mission for Clean Ganga, in India, are injecting substantial investments into water infrastructure, creating a conducive environment for private sector participation and innovation.  

The market’s expansion is further supported by the adoption of advanced technologies such as membrane bioreactors and zero-liquid discharge systems, which are gaining traction in both municipal and industrial applications. India’s ranking as the sixth-largest market for environmental technologies globally, with a notable position in water and wastewater management, underscores the sector’s significance. Moreover, with over 62% of urban wastewater currently untreated or partially treated, there is a vast scope for improvement and investment. These factors collectively make India’s wastewater treatment sector a promising avenue for investors seeking to contribute to environmental sustainability while achieving substantial returns. 

India’s wastewater treatment sector is poised for exponential growth, driven by urbanisation, water scarcity, and a regulatory push for sustainable infrastructure. However, to unlock the full potential of this sector, investors often look for evidence of successful precedents in similar emerging markets. Tunisia offers one such case. With over 60,000 tonnes of wastewater discharged through its main networks in the capital alone, and more than 10 million people affected by poor sanitation infrastructure, the country faced urgent pressure to upgrade its wastewater systems. In response, Tunisia developed a clear investment case for wastewater treatment. The UNDP’s SDG Investor Platform identified this sector as a high-return opportunity, with projected internal rates of return exceeding 25% over a 5–10-year horizon. Investment sizes typically start at USD 10 million, within a broader market size estimated between USD 100 million and USD 1 billion. Backed by strong public support—including a USD 9.25 million loan from the African Development Bank to modernise 19 treatment plants—Tunisia has demonstrated how combining policy alignment, infrastructure demand, and climate co-benefits can create an investable ecosystem for wastewater treatment. India, facing parallel challenges but on a larger scale, has even greater potential to mobilise private capital with the right enabling conditions in place.  

India now stands where other emerging markets once did—at the cusp of transforming waste into a wealth-generating asset. With enabling policies, cross-sector collaboration, and investor confidence, wastewater is not just an environmental imperative—it’s a business opportunity waiting to be unlocked. The Investor Forum is your gateway to this untapped potential. 

If you’re an investor interested in exploring opportunities in the sanitation space, reach out to Malavika at ravi@toiletboard.org to learn more about the upcoming Investor Forum.