Role of the private sector in providing sanitation services to the poor in India

Abstract

"Sanitation is more important than independence." - Mahatma Gandhi. Lack of sanitation causes nearly three million deaths around the world annually. This issue compounded by the negative economic impact of poor sanitation, costing developing countries billions of dollars a year. Despite decades of effort, provision of basic sanitation facilities still remains one of the largest global development challenges. In some countries, problems with public sector supply of sanitation services have led to increasing awareness that more participation of the non-state sector is needed in the provision of these services. On the other hand, sanitation enterprises comprise primarily of small players that struggle with high upfront capital costs required for toilet installation. Thus, owing to resource and capacity constraints, such enterprises will find it challenging to work alone in this area. One way to engage the private sector is to encourage partnerships with the government and community in developing creative new approaches and encouraging lasting services over the long term. To this end, the paper explores all activities involved in the sanitation sector and how different entities define and understand the sanitation value chain. In particular, it develops an understanding of the types of enterprises engaged in toilet construction and the methods of engagement. Next, it undertakes a global review of enterprise models in the sanitation sector and identifies key organizing principles for successful Public Private Community Partnerships (PPCPs) models. Selected elements from the global learnings are then modified to situate the learnings in Indian experiences. The key idea of this paper is not to prescribe any specific methods of functioning but to lay out different models and consequently generate new learnings for enterprise solutions to deliver on rural sanitation services in India. Lessons and findings from the paper reveal ideal ways to engage with the private sector - through Franchise Models, Corporate Social Responsibility (CSR) Models, Community Models and Integrated Models. While enterprise solutions can bring scale, sustainability and innovation, the government plays an integral role through enabling policies and provision of local institutional platforms. The paper shows how strategic alliances through PPCPs would effectively tackle the problem through scalable business solutions.