Goodbye to tankers
Sameer Vyas, Managing Director, New Tirupur Area Development Corporation Limited, talks to M.C. Vaijayanthi about the uniqueness of the Tirupur Water Supply Project.
India's famous knitwear town, Tirupur, which earns a billion US dollars a year through exports, decided to take the private route in the early 1990s to put an end to its water woes. Situated 50 km east of Coimbatore, Tirupur for years has been running on water transported through tankers from afar and whatever little groundwater it had was declared polluted and unfit for human consumption. Tirupur town realised its dream of organised water supply to the town in February this year when the New Tirupur Area Development Corporation Ltd's project was launched.
Though skeptics have been crying foul over things ranging from high price, the households and industry have to pay for the water as well as thousands of households being left out of the scheme, NTADCL says that the project is doing fine in terms of connections and "like any other infrastructure project it will take a year-and-a-half to stabilise and that is the time we are giving this project too," says Sameer Vyas, Managing Director, NTADCL.
Sharing his project experience with Projectmonitor, Vyas says the major achievement of the project is that it did not undergo any changes during implementation. "The project documentation took time. Once that was over then we got the project constructed ahead of schedule," he says. India's first private-public water supply project started with the formation of a special purpose vehicle, NTADCL, in 1995, by the Government of Tamil Nadu and Infrastructure Leasing and Financial Services Ltd.
Being the first of its kind in the country, Vyas says the documentation took a lot of time to be completed. But he says, "At the end of it whatever came out, the concession agreement, the purchase agreement, were efficient and robust documents; because, we have not had any problems relating to the terms and conditions of those documents once they were finalised. Otherwise you would have had some problem or other associated with it. They have never been questions, challenged and doubted in any way."
The Rs 1,023 crore project has been funded through equity of Rs 322.70 crore, debt of Rs 613.80 crore and a subordinate debt of Rs 86.50. This is supposed to be the first water supply project to be financed commercially on a limited recourse basis. The project also raised $25 million in the US capital market in association with USAID. Vyas says tying up finance also took time as, for banks and financial institutions the project was something new and "water sector is much more sensitive. There were 20 institutions involved and to carry them all along as you know takes a bit of time."
The same was the case in drawing up contractors for the project, Vyas notes. The overall project was split into three separate contracts, two awarded on an EPC basis and one to operate and manage (O&M) the finished facility. As it was new project experience for them the contracts had to be negotiated and drafted accordingly. The water treatment plant was built to a conventional design using a rapid gravity filter with a lamella clarifier to provide the 185 million lpd capacity. The wastewater facility, which is intended to take domestic sewage only, uses an activated sludge system to treat 30 million lpd to secondary level standards. Simultaneous construction was taken up though the project was implemented in two parts. The EPC 1 work, which involved building the water intake, the transmission pipeline from the river to Tirupur and the master balancing reservoir, was given to HCC Ltd. M&M-L&T joint venture was responsible for the EPC 2 contract which constructed the main feeder pipelines and distribution networks, overhead and ground level storage tanks and the sewerage network in the Tirupur town area. The project included construction of a sewerage system for Tirupur Municipality and onsite sanitation facilities for slums within the municipality.
The Tirupur Water Supply Project includes the construction of an intake structure downstream of Bhavani-Cauvery river confluence, 55 km of transmission pipeline and a complex system of 25 reservoirs. The project is expected to provide water to nearly 1,000 textile units and over 16 lakh residents in Tirupur and its surrounding areas. In executing the project there has been no conflict whatsoever with either the residents of Tirupur or the local bodies, says Vyas. "For us the very basic objective is that the project is there for the next 30 years. You don't look at residents of Tirupur as the people on the other side of the table. This is their project, it is for them. We have tried to move forward on that collaborative basis. There have been absolutely no misunderstandings and no problems. On the other hand they make demands on us. We try to accommodate it. We look at it as a community sort of project and don't approach it as a private infrastructure company. Water is a sensitive subject," Vyas explains.
As per the project details, around 125 million litre of water are to be supplied to the knitwear dyeing and bleaching industry, 25 million litre to Tirupur Municipality, which includes 60,000 slum dwellers, and 35 million litre will be shared between the region's remaining rural towns, villages and settlements. Initial reports suggested lukewarm response to taking water connections, but Vyas says that it is not true and right now they are serving about 9 lakh households in both semi urban and rural areas. "Internally we subsidised the water for households. Industry pays a higher price and households a lower price. But nevertheless people have to learn to pay for these services. You don't pay for it and the services are not provided efficiently," says Vyas. The tariff that has been fixed stands at Rs 45 per 1,000 litre to industry, Rs 5 per 1,000 litre for Tirupur Municipality and Rs 3.5 per thousand litre to the panchayats.
Vyas is very positive about the experience gained from executing this water project. "The first one is always a challenge. The second one if we have to do, we are doing one now, will be a matter of months and years. We are doing a similar project in Tirupur, a Rs 400 crore industrial effluent treatment project. The whole process started sometime last year and we hope to complete it by this December."
This project has inspired interest in many and Vyas says "People keep coming to us, they go to Tirupur. They are very excited by what they see and if they want any assistance we are willing to provide. But the word has to spread." Vyas ends the conversation with a very emphatic statement: "A project of this kind is very viable in every sense of the term."
India's famous knitwear town, Tirupur, which earns a billion US dollars a year through exports, decided to take the private route in the early 1990s to put an end to its water woes. Situated 50 km east of Coimbatore, Tirupur for years has been running on water transported through tankers from afar and whatever little groundwater it had was declared polluted and unfit for human consumption. Tirupur town realised its dream of organised water supply to the town in February this year when the New Tirupur Area Development Corporation Ltd's project was launched.
Though skeptics have been crying foul over things ranging from high price, the households and industry have to pay for the water as well as thousands of households being left out of the scheme, NTADCL says that the project is doing fine in terms of connections and "like any other infrastructure project it will take a year-and-a-half to stabilise and that is the time we are giving this project too," says Sameer Vyas, Managing Director, NTADCL.
Sharing his project experience with Projectmonitor, Vyas says the major achievement of the project is that it did not undergo any changes during implementation. "The project documentation took time. Once that was over then we got the project constructed ahead of schedule," he says. India's first private-public water supply project started with the formation of a special purpose vehicle, NTADCL, in 1995, by the Government of Tamil Nadu and Infrastructure Leasing and Financial Services Ltd.
Being the first of its kind in the country, Vyas says the documentation took a lot of time to be completed. But he says, "At the end of it whatever came out, the concession agreement, the purchase agreement, were efficient and robust documents; because, we have not had any problems relating to the terms and conditions of those documents once they were finalised. Otherwise you would have had some problem or other associated with it. They have never been questions, challenged and doubted in any way."
The Rs 1,023 crore project has been funded through equity of Rs 322.70 crore, debt of Rs 613.80 crore and a subordinate debt of Rs 86.50. This is supposed to be the first water supply project to be financed commercially on a limited recourse basis. The project also raised $25 million in the US capital market in association with USAID. Vyas says tying up finance also took time as, for banks and financial institutions the project was something new and "water sector is much more sensitive. There were 20 institutions involved and to carry them all along as you know takes a bit of time."
The same was the case in drawing up contractors for the project, Vyas notes. The overall project was split into three separate contracts, two awarded on an EPC basis and one to operate and manage (O&M) the finished facility. As it was new project experience for them the contracts had to be negotiated and drafted accordingly. The water treatment plant was built to a conventional design using a rapid gravity filter with a lamella clarifier to provide the 185 million lpd capacity. The wastewater facility, which is intended to take domestic sewage only, uses an activated sludge system to treat 30 million lpd to secondary level standards. Simultaneous construction was taken up though the project was implemented in two parts. The EPC 1 work, which involved building the water intake, the transmission pipeline from the river to Tirupur and the master balancing reservoir, was given to HCC Ltd. M&M-L&T joint venture was responsible for the EPC 2 contract which constructed the main feeder pipelines and distribution networks, overhead and ground level storage tanks and the sewerage network in the Tirupur town area. The project included construction of a sewerage system for Tirupur Municipality and onsite sanitation facilities for slums within the municipality.
The Tirupur Water Supply Project includes the construction of an intake structure downstream of Bhavani-Cauvery river confluence, 55 km of transmission pipeline and a complex system of 25 reservoirs. The project is expected to provide water to nearly 1,000 textile units and over 16 lakh residents in Tirupur and its surrounding areas. In executing the project there has been no conflict whatsoever with either the residents of Tirupur or the local bodies, says Vyas. "For us the very basic objective is that the project is there for the next 30 years. You don't look at residents of Tirupur as the people on the other side of the table. This is their project, it is for them. We have tried to move forward on that collaborative basis. There have been absolutely no misunderstandings and no problems. On the other hand they make demands on us. We try to accommodate it. We look at it as a community sort of project and don't approach it as a private infrastructure company. Water is a sensitive subject," Vyas explains.
As per the project details, around 125 million litre of water are to be supplied to the knitwear dyeing and bleaching industry, 25 million litre to Tirupur Municipality, which includes 60,000 slum dwellers, and 35 million litre will be shared between the region's remaining rural towns, villages and settlements. Initial reports suggested lukewarm response to taking water connections, but Vyas says that it is not true and right now they are serving about 9 lakh households in both semi urban and rural areas. "Internally we subsidised the water for households. Industry pays a higher price and households a lower price. But nevertheless people have to learn to pay for these services. You don't pay for it and the services are not provided efficiently," says Vyas. The tariff that has been fixed stands at Rs 45 per 1,000 litre to industry, Rs 5 per 1,000 litre for Tirupur Municipality and Rs 3.5 per thousand litre to the panchayats.
Vyas is very positive about the experience gained from executing this water project. "The first one is always a challenge. The second one if we have to do, we are doing one now, will be a matter of months and years. We are doing a similar project in Tirupur, a Rs 400 crore industrial effluent treatment project. The whole process started sometime last year and we hope to complete it by this December."
This project has inspired interest in many and Vyas says "People keep coming to us, they go to Tirupur. They are very excited by what they see and if they want any assistance we are willing to provide. But the word has to spread." Vyas ends the conversation with a very emphatic statement: "A project of this kind is very viable in every sense of the term."
[01 May 2006] Project Monitor
Comments