Intensifying Demand for Municipal Water Supply Drives Indian Water Treatment Systems Market, finds Frost & Sullivan

Intensifying Demand for Municipal Water Supply Drives Indian Water Treatment Systems Market, finds Frost & Sullivan

Desalination, recycle and reuse systems to dominate the market

Mumbai, Maharashtra, India

As India eases into an exciting stage in its economic development, associated opportunities are unfolding in the country’s water and wastewater sector. After power generation, water supply and sanitation is the next high-growth industry, as the need for municipal water expands steadily. With more than 20 metros expected to mushroom by 2032, the water stress will only increase, creating huge demand for water and wastewater treatment systems in the Indian municipal segment.

New analysis from Frost & Sullivan, Analysis of the Indian Municipal Water and Wastewater Treatment Market, finds that the market earned revenue of INR 31,260 million in 2013 and estimates this to reach INR 49,000 million by 2018. Market growth is attributed to the rising population and urbanization. The study covers water treatment technologies such as desalination, clarification, filtration and activated sludge process.

For complimentary access to more information on this research, please visit: http://corpcom.frost.com/forms/EBT_IWTSM

“Widening water-supply demand is the key driver for the municipal water and wastewater treatment market,” said Frost & Sullivan’s Environment & Building Technologies Analyst. “Of the 32 major cities in India, 22 are facing water shortages. Even in cities with comparatively narrower demand-supply gap, shortages are registered due to significant water loss during transmission.”

While demand drives the market, growth will be tempered the lack of proper planning and funds for infrastructure. Municipalities are unable to generate sustained revenues due to low water tariffs, poor meter connections, and a high share of non-revenue water supply. "With water being highly subsidized in India, most municipal corporations are unable to recover the cost of water supply,” stated the analyst. “Alternate sources of water, such as recycle and reuse water for various non-potable municipal applications, is very limited.”

In order to meet the growing water demand, two sustainable options are available – desalination and wastewater recycle and reuse. While desalination has strong potential, treatment of wastewater for recycle and reuse is still in the nascent stage in India. Unlike most of Europe and America, the wastewater recycling and reuse concept is gaining currency in India only now. However, the sector presents tremendous potential, as only 30 percent of the wastewater generated is currently being treated.

“Latest developments in the global desalination segment can be brought to India through joint ventures (JVs),” mentioned the analyst. “In such JVs, domestic water and/or infrastructure companies can meet the civil and structural development needs of desalination plants. These companies can also contribute with relevant technological insights, along with offering operation and maintenance expertise.”

Analysis of the Indian Municipal Water and Wastewater Treatment Market is part of the Environmental (http://www.environmental.frost.com) Growth Partnership Service program. Frost & Sullivan’s related studies include: Point of Use Water Purifier Market in India, Analysis of the Gulf Cooperation Council (GCC) Membrane Elements Market, Analysis of the North America Tertiary and Advanced Wastewater Treatment Equipment Market, Produced Water Treatment Market in Southeast Asia, Global Residential and Light Commercial Water Treatment Equipment Market. All studies included in subscriptions provide detailed market opportunities and industry trends evaluated following extensive interviews with market participants.

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India’s Path to High Economic Growth is Achievable by the end of 2020, says Frost & Sullivan

India’s Path to High Economic Growth is Achievable by the end of 2020, says Frost & Sullivan

Mumbai, Maharashtra, India

Frost & Sullivan presents a brief survey of the Indian Economy, its passage through 2014. From a policy perspective, the year 2014 can be divided into two distinctive phases demarcated by the change of guard at the Center in May-end. On the domestic front, a lethargic atmosphere of legislative, administrative, and bureaucratic paralysis gave way to a pro-active public culture of accomplishment and accountability. Internationally, foreign relations with the US, a key trade partner that had plummeted to rock-bottom after the poorly-handled diplomatic incident of an Indian Foreign Service officer in January, soared culminating in the US President accepting the invitation to be the chief guest at the 65th Republic Day celebrations in 2015. Meanwhile, the Prime Minister’s excursions abroad managed to not only capture the world’s attention but created a pipeline of foreign capital worth billions of dollars into domestic manufacturing. Mr. Modi, in the process, has smoothly transitioned from the Bharatiya Janata Party’s star campaigner and orator to India’s internationally-acclaimed brand ambassador even as he cemented his reputation as an effective statesman at home.


On the economic front, there have been equally positive developments, albeit largely due to exogenous factors. Within a year, the price of crude oil in the Indian basket has fallen by over 40 per cent from US $108.72 per barrel to US$60.58 per barrel in December easing off pressures on the twin deficits. With a continuing downward price trend, monthly oil imports have started falling since October and eased pressures off the trade deficit. It has also made the ambitious-looking fiscal deficit target of 4.1 percent of GDP more achievable due to an estimated fuel subsidy savings of almost US $1.7 billion aided by policy measures resulting in food subsidy savings and lower spending on welfare programs through greater efficiency.

Meanwhile, the easing of global commodity prices has reduced inflationary pressures; the consumer price inflation has nearly halved from 9.9 percent in December last year to 5.5 percent in October while the wholesale price index inflation has softened to 1.8 percent from 5.1 percent during the same period. Most importantly, the economy seems to have bottomed out with GDP growing at above 5 percent for three consecutive quarters. Indications of green shoots rising from better consumer and business sentiments signal even better times to come in future. It is quite likely that in a few years’ time, 2014 will be marked as the landmark year when things began to take a definite turn for the better for India.


Structural reforms addressing inefficiencies in the fields of energy, agriculture, labor market, taxation, and welfare schemes, will further unshackle the potential of the Indian economy. In particular, Prime Minister Modi’s focus on fast-tracking infrastructure development and energy security will ensure that roads, solar energy, smart cities, and other infrastructure segments see a larger inflow of investments. The uptrend in investor interest is also palpable amongst foreign investors with significant commitments from countries such as Japan and China across a wide range of established and emerging industries. While speed is of the essence for the Government to capitalize on its goodwill, years of bureaucratic neglect cannot be reversed overnight and it will take time for the Government to work through the backlog and bring in a coherent friendly framework for investors.


In the final analysis, India is not completely out of woods and it is imperative that the reform agenda is consistently followed. The Modi wave is leading to tectonic changes in the Indian political economy and the rise of new alliances is unlikely to be a smooth one. Against this background, the ruling coalition’s minority in the Upper House will hinder legislative reforms - the Insurance (Amendment) Bill and the Apprentices (Amendment) Bill were examples of this resistance in 2014. This will require the Government to seriously negotiate and adopt a non-confrontational approach with an opposition battling to save its turf.

If the developments of the past year and those currently in flux are a reflection of a changed reality that is here to stay, India’s growth is likely to rise to a high single-digit trajectory at the minimum by 2020. To this end, immediate reforms covering dispute resolution of pending highway projects, new gas-pricing policy, fuel shortages, timely project approvals, and better project monitoring of Government schemes have the potential to add around 150 basis points to growth taking it past 8 percent. The next Budget, due in February, is most likely to be the platform to start off the next set of more-difficult-to-handle reforms and give a better idea of the Government’s future roadmap of action. Other areas of reform in the medium term include the liberalization of the Labor Act, revision of the Companies Act, and review of the Land Acquisition Act. Beyond 2017 – the year when the ruling coalition is expected to reach a majority in the Upper House - the pace of reforms will pick up and a double digit growth by the end of the decade will become increasingly achievable. Combined with an inflation rate of around 5 percent, the end of the decade could see India rising to become a US$4.5 trillion economy.

The study was undertaken by the Innovation and Knowledge Center (IKC) which is the fundamental research hub of Frost & Sullivan’s consulting and strategy consulting business in the Middle East, North Africa, and South Asia. It consolidates all forms of research including technical, application-related, economic, financial, and market under a single umbrella. In addition to creating comparative studies for states such as the attractiveness index, the economic research arm of IKC has a portfolio of products which can aid a market player to understand the impact of various macroeconomic forces and make the best of them in a business environment. Some of these enablers are country profiles, multi-country comparative studies, PESTLE analysis, impact analysis of global economic and political developments, investment trackers, and economic pulse monitors.

To know more about this Market Insight or the Practice please get in touch with our Corporate Communications Team, send an email to Ravinder Kaur/Priya George at ravinder.kaur@frost.com / priyag@frost.com with your full name, company name, title, telephone number, company e-mail address, company website, city, state and country.

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High-Growth Datacenter Sector Drives Indian Rack and Rack Options Market, notes Frost & Sullivan

High-Growth Datacenter Sector Drives Indian Rack and Rack Options Market, notes Frost & Sullivan

Technology adoption among small and medium-sized businesses also spurs demand
The boom in information processing and data transfer activity in India has been encouraging investment in datacenters. Small and medium businesses/enterprises (SMBs/SMEs) in the country have been in expansion and transition mode. As information and communication technology (ICT) will play a vital role in their continued growth, captive and hosted datacenters are expected to account for a substantial portion of IT spending. This in turn will fuel demand for rack and rack options. In fact, the market prospects of rack and rack option suppliers will only brighten over the next five years as the Indian datacenter market gains momentum owing to steady domestic and international demand for IT services.

New analysis from Frost & Sullivan, India Rack and Rack Options Market, finds that the market earned revenues of INR 6.59 billion in fiscal year (FY) 2014 and estimates this to reach INR 10.31 billion in FY 2019. The study covers the end-user segments of datacenters, telecom, and SMEs/SMBs.

“With the increase in data usage among mobile users and rising tenancy ratio of towers, telecom infrastructure providers across India will also find use for rack and rack options,” said Frost & Sullivan Energy & Environmental Industry Analyst.

Nevertheless, the slow replacement rates of racks have contained the market’s pace of development. As a result of technical advancements in the components and raw materials used to manufacture racks, these products last for 15 years. Hence, end users rarely have to replace or upgrade rack units, a trend which has depressed market participants’ overall revenues.

The profitability of rack and rack option suppliers across India has also suffered due to the price sensitivity of the market, caused partially by the presence of a large number of unorganized suppliers in the country. Since the degree of technical change and product innovation are low in the market, the barriers to entry are also low and thus market competition is intense. Unorganized suppliers with sheet metal production capacities tend to offer basic racks at more affordable rates than organized suppliers, eroding the bargaining power of organized suppliers.

“Once new players enter the market, and technological development and product portfolio diversification gain pace among existing rack suppliers, competition will become even stiffer,” noted the Analyst. “Rack and rack option suppliers across India should position themselves as one-stop solution providers, who sell products ranging from power distribution units to cooling and management software, to succeed in the market.”

If you are interested in a virtual brochure, which provides a brief synopsis of the research and a table of contents, then send an e-mail to Ravinder Kaur/ Priya George, Corporate Communications, at ravinder.kaur@frost.com/ priyag@frost.com, with your full name, company name, title, telephone number, company e-mail address, company website, city, state and country. Upon receipt of the above information, a brochure will be sent to you by e-mail.

India Rack and Rack Options Market is part of the Power Supplies & Batteries (http://www.powersupplies.frost.com) Growth Partnership Service program. Frost & Sullivan’s related studies include: Competitive Strategies Benchmarking in Data Center Physical Infrastructure Industry, Global Programmable Direct Current (DC) Power Supplies and Electronic Loads Market, Global Industrial UPS Market, and European Rack and Rack Options Market. All studies included in subscriptions provide detailed market opportunities and industry trends evaluated following extensive interviews with market participants.

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