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Fog Lights for your Business

Contents
01 Background
a. Scope and limitations b. Research aim and objectives

02

Desalination Market in India

a. b. c. d. e. f. g. h. i. j. k.

Desalination-Overview Indian Desalination Market Industry Structure Technology Recently Completed Projects Key Projects & Future Investments State wise Desalination Plants Growth drivers & Restraints Industry Challenges Market Trend of India Desalination Market Future outlook

03

About Us

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Background

4 | Fog Lights for your Business

Scope and timelines

Assessment of the Desalination Market in India for 2013 and market forecast for 2018 Feedback has considered the fiscal year 2013 for this market assessment, which represents the period between April 2012 and March 2013 The study was conducted during Jan 2014

Limitations

Qualitative information is based primarily on discussions held with the key players and could therefore be subject to variations

Current and Future trends are based on the secondary reports available

from the various stakeholders reports

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Research aim and objectives

Research aim

Research objectives
Overview of Desalination Market in India

Recently Completed Projects

The aim of the research is to present a comprehensive overview of the Desalination Market in India

Key Projects & Future Investments

Providing Insights Into Desalination market barriers and their impact on the future market

Future Market Projections For 5 Years

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Desalination-Overview

Indian Desalination Market (cubic m/day)

Capacity

Desalination is a process that removes salt and other minerals from saltwater and brackish water in order to produce fresh water suitable for potable purposes, as well as water for irrigation and industrial purposes Indias water desalination business is set to triple to INR 120 crore by 2017
Total installed capacity of desalination plants in

1,450,000

India was 912,368 cubic m/day in 2013 The Desalination Market is in its development stage in India
The desalination market has witnessed

1,210,000

phenomenal growth in last three years

It has emerged as a cost-effective solution to

the need to provide water

910,000

India has 182 desalination plants operating in different location

The number of units that process sea water in

Most of the desalination projects running in India are on PPP (Public Private Partnership) and BOOT (BuildOwn-Operate-Transfer) Model India allocated INR 53,660 crore for urban supply projects in the five years ending March 2012

India will reach 500 in five years from 180 now, with more than 300 plants being built in the states of Tamil Nadu, Gujarat and Maharashtra, Gujarat and Tamil Nadu registered highest growth in desalination capacity

730,000

580,000

461,000

Membrane-based technologies are considered 23% cheaper for generating desalinated water when compared with thermal-based ones
85 per cent plants in India are membrane based

367,000

291,000

plants

Top industry players are Ion Exchange, Degremont, Thermax, VA Tech Wabag, Aquatech, GE Water & Process Technologies, IDE Technologies and BGR Energy Systems

FY 08 FY 09 FY 10 FY 11 FY 12 FY 13 FY14 FY15

Source: Feedback Analysis

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Industry Structure
Desalination Service Providers/Equipment Manufacturers

Industrial Desalination Plants: Large companies inclination to have captive desalination plants to meet their process water demands

State Government-Owned Desalination Plants: Government comes out with desalination plants to fulfill states household and municipal water needs

The model used in tenders/projects by industrial institutions is custom build and transfer. In some projects, O & M is also taken care for 3 to 5 years

The model used in tenders/projects by government is BOOT (build, own, operate and transfer). Usual time spread is of 10 to 20 years

Note: Power plants and pharmaceutical companies use 72 percent of the current capacity, with the remainder taken up by municipal corporations
Source: Feedback Bok

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Thermal

Membrane

Multi-stage flash (Most Commonly used)

Multiple stage heating and condensation

Electro dialysis
Works by electric potential difference of

ion particles.
Effectively neutralizing the individual

process
Generally built in units of about 4,000

charges through ion-exchange membranes

Membranes are arranged alternatively

cum/d to 30,000 cum/d

Operating temperature around 120C

Electro dialysis Reversal Process

Electric current migrates

Multiple Effect Distillation

Multiple stage heating in a series of vessels

dissolved salt ions, through an electrodialysis stack of cationic and anionic ion exchange membranes.
Capability of high recovery of water Less chemical usage

or tubes
Generally built in units of about 2,000

cum/d to 10,000 cum/d

Operating temperature below 70C

Vapour Compression Distillation

Distillation by vapour generation through

Reverse Osmosis
Pressuring on semipermeable

compressor or a steam jet.

Generally built in units of about 20 cum/d

membrane to overcome osmotic pressure

to 2,000 cum/d
Source: Feedback Analysis

to separate ions and molecules

Efficiency: 20-70 % of the feed flow

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Recently Completed Projects

For Tata chemicals GE installed a 5.8 MLD sea water desalination plant IDE technologies has installed nine desalination plants at Jamnagar and two at Kakinada for Reliance Petroleum, two each in Essar Oil limited and Sanghi Industries limited, four for Nuclear Power Corporation of India and one for EID Parry BHEL has commissioned a desalination plant on a turkey basis in the Gulf of Mannar in Tamil Nadu Chemplast has set up a desalination plant in Karaikal to meet the needs of its caustic soda plant Tata Steel has a set up an integrated water and power plant for its Titanium Dioxide facility in Tamil Nadu Sterlite Industries has set up a desalination plant for its copper smelting plant at Tuticorin in Tamil Nadu L&T has set up a thermal desalination plant for its cement plant in Gujarat Ramanathapuram in Tamil Nadu on PPP for rural water supply

Source: Feedback Analysis

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Major investments company wise (Rs in Mn)

Company Name Project Name Dahej Seawater Desalination Plant Project North Chennai Water Desalination Project Willingdon Island Desalination Plant & Water Supply Project Nemmeli Sea Water Desalination Plant Project Kutch Water Desalination Plant Project Vallur Seawater Desalination Plant Project Sea Water Desalination Plant Project Cost (INR Cr) 2000 Capacity Mn Ltrs 70.00 Project Status Location State

Investments by Project Status

3,000 2,500 2,000 1,500 2,500 Cost Rs in Cr 1,953

Swarnim Dahejspring Desalination Pvt. Ltd. I V R C L Ltd.

Announced

Dahej North Chennai Willingdon Island Nemmeli

Gujarat

500

200

Announced

Tamil Nadu

1,000
500 0 Project Announced Project Under Implementation

Cochin Port Trust Chennai Metropolitan Water Supply & Sewerage Board Gujarat Infrastructure Devp. Board N T P C Tamilnadu Energy Co. Ltd. Chemfab Alkalis Ltd. Government Of India

NA

NA

Announced Under Implementation Under Implementation Under Implementation Under Implementation Under Implementation

Kerala

1033

100.00

Tamil Nadu

Note: Total number of outstanding projects as of Aug 2012 is 8 (Included only Announced Projects and projects under implementation)

750

1,500.00

Kachchh

Gujarat

126.3 30 14

NA NA NA

Vallur Kalapet

Tamil Nadu Puducherry

Announced Projects Projects that are announced and not yet started
Projects Under Implementation Projects that are currently ongoing which is termed as projects that are under implementation
Source: Feedback Analysis

Puzhayakayal Sea Water Desalination Plant

Puzhayakayal Tamil Nadu

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State wise Desalination Plants

Indian Desalination Services market

Current Desalination Plants state wise Capacity: 2,91,820 cum/day, (India), 2012

Gujarat and Tamil Nadu have been more active in setting up desalination plants in comparison to other coastal states in India Others include states such as Maharastra, Andhra Pradesh, Rajasthan, Orissa, and West Bengal. Large projects such as Krishnapatnam port, Kasnau-Matasukh Lignite Mines, Visakhapatnam, and so on are scheduled to be functional in the coming years Drinking water scarcity is one of the major reason for coastal regions to go for desalination Increasing awareness for excess ground water contamination has forced industrial and institutional setups to look for desalination plants for water needs. State governments strictly working for the norms of industrial usage of ground water. The market in non-coastal regions mostly consists of large industrial and institutional corporate houses

16%

47%

37%

Gujarat

Tamilnadu

Others

Source: Feedback BoK

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Growth Drivers

Restraints

Support from the Central Government and many states have contributed enormously in growing demand for desalinated water in India Growth in population and reduced availability of safe drinking water (especially in coastal regions) Wide disparity in rainfall distribution in different regions

Increase in cost of water will inflate overall production costs for any industrial unit. This factor impedes the adoption of desalination plants
Infrastructure maintained by industries, which started a decade ago will have to go for restructuring to accommodate desalination plant. Such restructuring is not supported by most of the industrial setups Many industrial units are installing plants for water recycling and reducing water usage. This, in turn, will reduce the opportunities for desalination plants Although India is not much effected by global recession, still a few projects have been put on hold by industries to keep their energies focused on the core work

Lack of adequate rainfall and surface water resources in catchment areas

Increasing restriction on ground water usage leading to demand for alternative sources of water especially among industries Decrease in per unit cost of desalination from latest technological developments Industrialization

Source: Feedback BoK

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Industry Challenges

Industry Fragmentation:
Desalination market in India is highly fragmented with so many Tier-2 and regional players.

Creation of industry wise standards is a major challenge

Improper Training and Skill sets:

As the desalination market in India is new, there is a scarcity of proper human resources.

Skilled human resource and training the resource handling the plant is a major challenge . Improper training of the staff handling the plants is a major challenge for this growing industry

Bureaucratic Hurdles:
There are many desalination projects, which were announced in 2005 in Orissa, Andhra

Pradesh, and Pondicherry. However, due to slow execution and bureaucratic hurdles, they have not started yet

Protests:
Recent fishermens protest against Adani groups SEZ and its desalination plant in Bhuj,

Gujarat has raised questions on the growth of desalination plants near the coastal lines

Power:
Major challenge is the availability of power. In order to run a successful desalination plant,

access to a stable uninterrupted 24x7 power supply is a major requirement

Source: Feedback BoK

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Past Market Trend (INR in crs)

2500 2164 2000 1664 1500 1245 1000

The Indian desalination market is very nascent and in the development stage
Desalination market is expected to outperform the other water treatment markets. Government support, private sector participation, and awareness will help in the growth of this market With Government support, private sector participation, and awareness will help in the growth of this market. With foreign players eyeing this market, it will witness some best practices, in terms of technologies and processes, being adopted in near future.

500

0 FY11
Source : - Feedback BoK

FY12

FY13

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Future outlook

Indian Desalination Market

INR Cr 7,000 6,000 6,000 5,000 4,031 4,000 3,304 3,000 2,708 4,918

India desalination market to grow at 22% CAGR till 2017 to reach INR 6000 Cr
India is expected to have over 500 desalination

plants by 2017
With more than 300 plants being built in the

states of Tamil Nadu, Gujarat and Maharashtra

The top five states to emerge as desalination hubs are Maharashtra, Gujarat, Tamil Nadu, Karnataka and West Bengal A 150-million-litre-a-day desalination plant to convert sea water to drinking water is to come up adjacent to the Nemmeli desalination plan. The additional capacity will supply drinking water to over 6.46 lakh residents in the suburbs to the south of Chennai which were added to the City Corporation limits. With growing demand and more focus on desalination by states, the capacity is expected to reach 1,449,942 cubic m/day by 2015

There are many projects, which are approved by respective government bodies and are in initial phases of development. Government projects have invited tenders for desalination plants on BOOT model. The government is considering a proposal for setting up six Low Temperature Thermal Desalination (LTTD) plants on Lakshadweep Islands

2,220
2,000 1,000 0 FY FY FY FY FY FY 2012 2013 2014 2015 2016 2017

Source: Feedback Bok

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