Impact of COVID On Indian Sanitation Ecosystem

Potential impact
of COVID-19 on the
Indian sanitation
ecosystem
April 2020
home.kpmg/in/covid-19
Foreword
Respond, not react
The COVID-19 pandemic is large cities such as Mumbai,
impacting our lives, as well as our Delhi and Indore emerging as
social networks and transactions significant hotspots. COVID-19
in ways that we are only now has impacted all sanitation
beginning to comprehend. Before stakeholders and it is a great
the commencement of this year, concern that some of the most
all of us in the Indian sanitation vulnerable, the most exposed,
ecosystem were looking forward and the most affected are India’s
to the next phase of India’s sanitation workers. It is essential
WaSH (Water, Sanitation and to pause for a moment and
Hygiene) programmes (Swachh acknowledge the contribution
Bharat Mission 2.0, Jal Jeevan of these cleanliness champions
Mission, etc.) in the urban and who are putting their own lives
rural sectors. This black swan on the line and working on the
event is now compelling us frontlines for preventing the
to fundamentally reimagine spread of the virus thus keeping
the traditional ways of working us safe and healthy. We must
and responding to the WaSH always remember that it is their
needs of the Indian people , and work in exposed conditions that
consequently all the stakeholders keeps us safe in our homes.
involved in this critical national The local, state and national
mission-governments, the governments are also responding
private sector, donors and civil with all their resources not only
society organisations, have to contain the spread of the
to fundamentally rethink their infection but also to ensure that
strategies, policies, approaches, essential services are being
and ways of working, for provided, apart from additional
attaining the desired outcomes. responsibilities like doorstep
India has now seen over 18,6001 delivery and lockdown/isolation
confirmed cases, with several maintenance. Donors and
1. COVID-19 Coronavirus Pandemic, Worldometer; accessed on 21 April 2020
© 2020 KPMG, an Indian Registered Partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.
Foreword.. ctd.
development partners have the security and well being of all
also stepped forward, providing Indians, as the pandemic has so
emergency response assistance, dramatically demonstrated.
technical support to the This crisis has also strikingly
government, etc. Furthermore, demonstrated that individual
civil society organisations are security and well-being are
playing a significant role not absolutely contingent on the
only in supporting continuity health-security architecture
of services in cities, but also of societies at large, and that
supporting the urban poor and efficient and sustainable public
the vulnerable communities who sanitation systems are therefore
are most exposed to this crisis. a sine-qua-non for ensuring the
Similarly, private sector players welfare of all Indians.
in the ecosystem are facing We have put together this paper
significant headwinds as capex in an attempt to understand the
projects have come to a halt possible impact of COVID-19 on
and payments and liquidity are the Indian sanitation ecosystem,
emerging as significant problem and propose a range of
areas, apart from shortage of recommendations to mitigate
workers due to the lockdown. them, as well as to facilitate fast
We believe that a concerted recovery..
effort led by the government, Stay safe, stay strong.
and supported by all parts of this
ecosystem, is the need of the
hour to maintain the momentum Nilachal Mishra
that this sector has acquired in Partner - Infrastructure,
the past five years, and to attain Government and Healthcare
the outcomes of the programme, Head - Government
which are so critical for ensuring Advisory, KPMG in India
Executive summary
COVID-19 has infected nearly 2.5 million people in • Revenue contraction at local government level
more than 210 countries.2 Beyond the human tragedy, impacting capacity for investments
this pandemic has also ravaged the entire world
• Ongoing projects significantly impacted not only by
economy. Human and economic cost is likely to be
delay in payments, but also a crippling shortage of
more significant for lower and middle-income countries,
labour due to reverse migration
that generally have limited coverage and capacity of
water supply and sanitation systems, lower healthcare • Revenue impact significant for private sector, leading
capacity and larger informal sectors. to cash-flow issues, exacerbated by supply chain
disruption
This paper, prepared by KPMG in India and RTI, has
been put together using insights from more than 25 • WaSH services to urban poor significantly impacted
interviews with senior sanitation sector experts. Key
• For donor agencies, short term budgetary diversion to
findings are as below:
healthcare and emergency response expected; WaSH
• Significant decline in government spending expected expected to remain priority in the medium to long
in short term, impacting new projects term for those where it is already a priority
• No significant policy shifts anticipated • Increased willingness to pay for quality WaSH
services expected in medium to long term.
• Sanitation workers are in the frontline, and are
expected to be affected significantly, shortage of PPE
especially in smaller towns
Strategic recommendations:
1 2 3
Protecting our sanitation Reinvigorating private sector Shift ODF strategy – household
workers – Swachhagrahi participation in the sanitation toilets for all
Safety, Assurance and Financial ecosystem
Empowerment Scheme
(Swachhagrahi-SAFE)
• Life and health insurance • Enabling policies to improve • Shift away from community
• Upskilling for longer term contracting ecosystem toilets in slum areas
livelihood solutions through • Risk weighted credit guarantee • Convergence with PMAY to
NSKFDC fund provide household toilets for all.
• Provisioning of PPE. • WaSH incubator/accelerator
• Policy for small business/
startups.
2. COVID-19 Coronavirus Pandemic, Worldometer; accessed on 21 April 2020
Potential impact of COVID-19 on the Indian sanitation ecosystem | 01
Sector overview
Size of sector
INR1,718 crore (gross value added, 2017-18)2
Estimated number of sanitation workers

in India
5 million (approx.)3
Key programmes/missions on sanitation

• Swachh Bharat Mission – Urban and Gramin
• Atal Mission for Urban Transformation (AMRUT)
• Jal Jeevan Mission
Spend by Government of India on WaSH

programmes (2019-20)4
• SBM Urban – INR1,300 crore
• SBM Gramin – INR8,338 crore
• AMRUT – INR6,392 crore
• Jal Jeevan Mission (erstwhile National Rural
Drinking Water Program) – INR10,000 crore
Critical citizen-facing services

Sanitation
• Desludging of septic tanks, maintenance of
network sewers and drains
4. Numbers are revised budget for 2019-20; Source: Expenditure Budget from
2. Annual Survey of Industries 2017-18, Ministry of Statistics and Programme
• Operations and maintenance of sewage-

treatment plants and fecal sludge-treatment
plants
Implementation, Government of India’ accessed 9 April 2020
• Operations and maintenance of community and

3. The Sanitation Workers Project; accessed 9 April 2020
public toilets
Union Budget 2020-21; accessed 10 April 2020
Solid waste management

• Collection and transportation of household
waste
• Cleaning and sweeping of public spaces and
roads
• Processing of wet and dry waste
• Operation and maintenance of landfill sites.
© 2020 KPMG, an Indian Registered Partnership and a member firm of the KPMG network of independent member firms affiliated
with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.
02 | Potential impact of COVID-19 on the Indian sanitation ecosystem
Current and potential impact

National and State Governments
Impact
Investment in the sector Medium High Government spending may decline

a. Capital expenditure in the short term and new sanitation
b a
projects might get delayed.
b. Operational expenditure Low Unknown
Impact
Medium High Significant policy changes in

sanitation not expected; however,
Policy changes
increased focus on personal hygiene
Low Unknown
foreseen.
Impact
Medium High Sanitation workers are at the

frontline. Limited access to PPE,
Sanitation workers
healthcare and economic safety
Low Unknown
nets affect them significantly.
Impact
Medium High
Change in sanitation No significant shift expected in the
focus areas short to medium term.
Low Unknown
Local governments/Urban Local Bodies
Impact
Inevitable revenue contraction is
Investment in the sector Medium High
expected to limit local government’s
a. Capital expenditure b a capacity for new investments further,
b. Operational expenditure Low Unknown i.e., local governments may have to
delay capital-intensive projects
Impact
Medium High
Reverse migration not expected to
Shortage of human
correct in short term, leading to a
resources
Low Unknown crippling shortage of contract labour.
Impact
Medium High Overall short supply and focus on

provisioning to healthcare workers
Supply of PPE
to significantly impact already slim
Low Unknown
provisioning.
Impact
A significant number of sanitation
workers is in the informal sector,
Safety of sanitation with no social or health safety
workers net. Providing essential sanitation
Medium High
services in a pandemic situation
significantly exposes them to
Low Unknown infection, exacerbated by inadequate
provisioning of PPE
Impact
There are no formal business
Medium High
continuity mechanisms at the
Business continuity local government level; in case of
Low Unknown exponential infection spread, will
become an area of concern.
Impact
It is unknown whether the quality
Medium High
of local governance will improve;
Quality of local however, the same is imperative to
governance deal with similar situations in the
Low Unknown
future.
Impact
Inadequate service delivery in urban
slums, exacerbated by potential
Medium High
hotspots in particular due to limited
Impact on urban poor
possibility of social distancing, will
Low Unknown impact WaSH services to urban poor,
further magnified by loss of livelihood.
Private Sector
Impact
Almost all construction activity has
come to a halt due to the lockdown.
Medium High
Reverse migration will lead to labour
Construction activities
shortages and is expected to impact
Low Unknown construction activities in the short to
medium term.
Impact Constrained business operations and

reduced resource utilisation have led
to revenue impact. Interim increase
Medium High
Cash-flow management in costs associated with supporting
labour/contractor force during
Low Unknown COVID-19 has led to a negative impact
on profitability.
Impact
Opportunities for innovation towards
Medium High
making WaSH systems communicable
Business opportunities disease resilient. Collaboration
between sanitation and healthcare
Low Unknown private-sector companies to offer an
integrated value proposition.
Impact
Medium High Supply chain disruption - availability

and transportation of raw materials,
Business continuity
including cement, steel, chemicals
Low Unknown
and other resources.
International/national donor agencies
Impact
Existing budgetary outlays not
Medium High
expected to be impacted significantly;
Budget reallocation | however, reallocation of resources
reprioritisation of WaSH towards emergency response and
Low Unknown healthcare is expected, especially for
smaller donors/foundations.
Impact
WaSH expected to remain a priority
Medium High
(for those where its already a priority);
New priority or focus
however, focus on emergency
areas
Low Unknown response and livelihoods is expected
to increase in the short term
Citizens/civil society organisations
Impact
Increased willingness to pay for
Medium High quality sanitation services expected
Access to sanitation
services over the medium to long term. This
Low Unknown
will help to improve the financial
viability of WaSH services.
Impact
Medium High A significant shift in behaviour related
Behaviour change for
to personal hygiene anticipated,
personal hygiene and safe
expected to result in better and
sanitation practices Low Unknown
sustainable sanitation outcomes.
06
Recommendations
Guidelines and advisories
Short to medium term recommendations Long term recommendations
• COVID-19 has brought to light areas that need to be • Changes in existing policies would be
strengthened to sustain ODF (Open Defecation Free). For needed to align with health-related
example, community and public toilets are considered potential outcomes
hot spots of COVID-19. In light of the above, a modification • Development of an integrated waste-
is required to existing ODF/ODF+ guidelines to make these management policy for optimising the use
sanitation systems COVID-19 resilient of recycled waste
• Advisory on separate collection, transport and scientific • Modifications to solid waste management
disposal of bio-medical and fecal waste generated from plans are required to make them COVID-19
quarantined households/communities. resilient needs to be developed by cities.
Business continuity and return to normalcy

• Respond to the emergency need for sanitation services and • Look at ways of availing
prioritise the same. Waste collection and desludging needs to user charges for sanitation
be carried out at regular intervals with proper use of PPE services for revenue
• Awareness and safety training programmes to be organised for generation and project
sanitation staff sustainability.
• Activities need to be undertaken to ensure continued operation
of FSTPs and STPs
• Sanitation workers need to be motivated to continue sanitation
working during this crisis. Measures need to be taken to retain
and attract more sanitation workers
• Resume construction work on existing FSTPs, STPs, and other
sanitation-related projects.
Protection of sanitation workers (Health and livelihood)

• An adequate supply of PPEs and enforce the use • Capacity building of sanitation workers to
• Logistics arrangements and approvals for transportation of ensure mandatory usage of PPEs
PPEs need to be prioritized and fast-tracked • Economic/healthcare safety nets (for
• Regular health check of sanitation workers needs to be carried example, life and health insurance) for
out and, if infected, self-isolation arrangements need to be sanitation workers and their families in the
made event of getting infected.
• Work in rotational shifts to reduce any possible exposure to the
infection and avoid service disruptions
• Exempt old and high-risk (from co-morbidity perspective)
category sanitary workers from duty.
Recommendations
Sustaining behaviour change for safe sanitation practices
Short to medium term recommendations
• IEC campaigns for increased awareness among citizens in

terms of handwashing hygiene, and sustained use of toilets,
and cleanliness of public spaces.
Protection of urban poor/vulnerable communities

• Disinfecting and proper cleaning of community and public • Provision of individual household toilets
toilets with the provision of soap and sanitisation material (IHHL) for urban poor – transition from
• Waste management and desludging services to focus on slum community facilities
and densely populated areas for catering to emergency needs. • Discourage citizens from reverting to open
defecation.
Private sector
• Ensure continuity of contracts and payments • Promote private sector partnership and
• Increase and enhance partnerships to improve short-term help build the technical capacity of city
service delivery. utilities to implement sanitation projects
effectively
• Focus on identifying pathways to improve
the financial and economic viability of
sanitation PPP projects.
1 Strategic recommendation
Protecting our sanitation workers – Swachhagrahi
Safety, Assurance and Financial Empowerment Scheme
(Swachhagrahi-SAFE)
A comprehensive national Sanitation workers provide In addition to millions of workers

programme to provide social and essential services and play employed by government and
healthcare safety net to sanitation an integral role in maintaining private agencies in sanitation
workers (formal, contractual and the safety and hygiene in our services, there are thousands of
informal) is the need of the hour. communities, which is crucial informal sanitation workers who
This should include the following. now more than ever, in light of the are generally not recognized by
1. Life Insurance to the tune of ongoing COVID-19 crisis. Being the administration. They also
INR50 lakh at the frontline of pandemic, face disadvantage of not having
the sanitation workforce is at access to any protective gears or
2. Coverage in employee
higher risk of exposure to the training on handling and disposal
provident fund, with individual
virus. Yet the safety and other of hazardous waste. In order to
contribution funded through a
needs of sanitation workers are incentivize sanitation workers and
pool of funds
often not provided for and they ensure their safety during this
3. Health Insurance with consequently suffer all the worst crisis, initiatives must be taken
enhanced cover of INR25 lakh, effects of poor sanitation: injury, by the National, State and Local
integrated with Ayushman infection, stigma, among others. Governments to protect their
Bharat They also lack economic and health and livelihood.
4. Pool of funds to ensure social safety net protecting their
provisioning of adequate PPE livelihood.
5. Converged scheme through
the National Safai Karamcharis
Finance & Development
Corporation (NSKFDC)
to promote livelihood
opportunities not only for the
sanitation workers, but their
children as well.
Reinvigorating private sector participation in the
sanitation ecosystem
In view of the inevitable economic It is evident that the sanitation

downturn, the sanitation sector sector plays an important role in
could provide for significant the prevention and containment
economic opportunities over of disease outbreaks such
the short to medium term. as COVID-19, and the lack of
The government, to facilitate effective solid and liquid waste
this, could explore a dedicated management systems can impact
programme to streamline the larger system of pandemic
private-sector integration into the management. In situations like
sanitation ecosystem, hitherto these, it is vital that the public and
dominated by public utilities. This private sector work in tandem, to
should include the following. fill the widening gap of demand
1. Enabling policies for risk and supply of essential services.
pooling, outcome-based
contracts, escrow-based
payment mechanisms,
cash flow-based payment
milestones, etc.
2. A risk-weighted credit
guarantee fund could be set up
to lower the cost of capital for
WaSH enterprises
3. Policy for small business/
startup set aside in public
WaSH contracts
4. Dedicated WaSH incubator and
accelerator in partnership with
industry bodies and technical
institutions.
Shift ODF strategy – household toilets for all
The urban sanitation schemes in ensuring sanitation facilities to individual household toilets
India have prioritized on “provision all sections of the society cannot for all, perhaps in convergence
of options” for sanitation rather be undone with. It is necessary with slum redevelopment
than ensuring a single point that adequate emphasis is given schemes, and/or the Pradhan
approach of toilet construction to ensure community hygiene Mantri Awas Yojana (PMAY) and
for each household. Though it practices become the new normal potentially the National Urban
has been successful in ensuring for such vulnerable communities. Livelihood Mission (NULM).
coverage of all citizens to safe This would ensure seamless Convergence of these three
sanitation facilities, but much transition from shared toilets to missions with their respective
emphasis was required on the individual toilets and will provide mandates when brought together
community hygiene practices adequate window for planning the under a unified approach would
to be inculcated amongst the roadmap by local governments ensure such citizens who are
beneficiaries of these facilities. to ensure individual toilets are most impacted due to the evolving
In the present scenario, it is provided to all. circumstances of COVID-19
evident that social distancing Thus far, in urban slums where are provided with necessary
would become the new normal space has been a constraint support and will also significantly
in the days to come irrespective for provisioning individual contribute to longer term ODF
of the pandemic showing signs household toilets, community/ sustainability.
of containment or spread. This shared toilets have been used
would lead to a much larger to ensure no open defecation
apprehension amongst the and safe sanitation practices.
vulnerable sections of the society However, the same comes with
on using community or public an inevitable issue to limited
toilets. The usage of shared/ potential for social distancing.
common toilets cannot be India will, in the immediate
discouraged in these times but term, need to shift its strategy
at the same time, the focus on for ODF sustainability to provide
Acknowledgments
We are sincerely grateful to the following Executive Director – Shelter Associates
stakeholders for extending their knowledge and
• Mr Sanjay Sharma
insights to prepare this paper. Deputy CEO – Ecogreen Energy Gurgaon Faridabad
• Mr VK Jindal Private Limited
Joint Secretary, and National Mission Director, Swachh • Mr K S Anand Khumar
Bharat Mission (Urban), Ministry of Housing and Urban
DGM – Ramky Enviro Engineers Limited
Affairs, Government of India
• Other sector experts
• Mr Binay Jha
ULB officials, private sector leaders and citizens
Director, Swachh Bharat Mission (Urban), Ministry of
who have provided significant inputs
Housing and Urban Affairs, Government of India
• Mr Suneet Mehta
Authors
Deputy Secretary, AMRUT, Ministry of Housing and
Urban Affairs, Government of India • KPMG in India:
• Mr Sudhakar Bobade - Abhinav Akhilesh
Executive Director – Maharashtra Urban Development
Mission, Government of Maharashtra - Arpit Guha
• Mr Anand Rudra - Prabal Bhardwaj
Senior WaSH Sector professional - Tina Mathur
• Mr Sameer Rege • RTI:
CEO & Director, Mailhem Ikos Environment Pvt Ltd.,
and Nashik Waste Management Pvt Ltd - Nutan Zarapkar
• Mr Rajeev Kher - Kapil Adackaconam Suresan
Managing Director, 3S India,
• Mr Sampath Kumar
Managing Director, TIDE Technocrats and Executive Research and analysis support
Director, Kalyani Cleantech Private Limited • Himanshu Chaturvedi
• Mr Nimish Shah • Ikshwaku Sharma
Managing Director at Toilet Board Coalition, India
Chapter • Priya Iyer (RTI)
• Mr K S Suresh • Sreejita Basu
Head – Wastewater BU
• Vaibhav Rao
Mr S Giridharan, Head – Rural Water Supply BU
G. Balasubramanian
Head - Corporate Center, Water & Effluent Treatment Brand and compliance
IC, and others at Larsen and Toubro Construction-Water
and Effluent Treatment: • Darshini Shah
• Dr Rakesh Kumar • Nisha Fernandes

Director, National Environmental Engineering • Satyam Nagwekar
Research Institute
• Mr Rajan Samuel
Managing Director – Habitat for Humanity, India
• Ms Pratima Joshi
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RTI International. RTI’s contribution to this publication is a part of its
ongoing program in India funded by AusAID’s Water for Women (W4W)
Fund. The W4W Fund is supporting improved health, equality and
wellbeing in Asian and Pacific communities through socially inclusive
and sustainable water, sanitation and hygiene (WASH) projects.
KPMG in India contacts: RTI International contacts:
Elias George Shalabh Srivastava
Partner and Head Country Director
Infrastructure, Government and Healthcare Research Triangle Institute Global India Pvt Ltd
T: +91 124 336 9001 T: +91 11 4128 7150
E: eliasgeorge@kpmg.com E: ssrivastava@rti.org
Nilachal Mishra Nutan Zarapkar

Partner Director - WaSH
Head - Government Advisory Research Triangle Institute Global India Pvt Ltd
Infrastructure, Government and Healthcare T: +91 11 4128 7150
T: +91 124 669 1000 E: nzarapkar@rti.org
E: nilachalmishra@kpmg.com
Dr Abhinav Akhilesh
Director
Human and Social Services
Infrastructure, Government and Healthcare
T: +91 124 669 1000
E: abhinavakhilesh@kpmg.com
Dr Sanghamitra Bhattacharya
Technical Director
Human and Social Services
Infrastructure, Government and Healthcare
T: +91 124 669 1000
E: sanghamitrab@kpmg.com
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© 2020 KPMG, an Indian Registered Partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG
International”), a Swiss entity. All rights reserved.
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Potential impact

1. COVID-19 Coronavirus Pandemic, Worldometer; accessed on 21 April 2020

2. COVID-19 Coronavirus Pandemic, Worldometer; accessed on 21 April 2020

Estimated number of sanitation workers

Key programmes/missions on sanitation

Spend by Government of India on WaSH

Critical citizen-facing services

• Operations and maintenance of sewage-

• Operations and maintenance of community and

Solid waste management

Current and potential impact

Investment in the sector Medium High Government spending may decline

Medium High Significant policy changes in

Medium High Sanitation workers are at the

Local governments/Urban Local Bodies

Medium High Overall short supply and focus on

Impact Constrained business operations and

Medium High Supply chain disruption - availability

International/national donor agencies

Citizens/civil society organisations

Business continuity and return to normalcy

Protection of sanitation workers (Health and livelihood)

• IEC campaigns for increased awareness among citizens in

Protection of urban poor/vulnerable communities

A comprehensive national Sanitation workers provide In addition to millions of workers

In view of the inevitable economic It is evident that the sanitation

• Dr Rakesh Kumar • Nisha Fernandes

About KPMG in India

About RTI International

Nilachal Mishra Nutan Zarapkar

This document is meant for e-communication only. (006_THL0420_DS)

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