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India is the tenth largest bottled water consumer in the world. In 2002,
the industry had an estimated turnover of Rs.10 billion (Rs.1,000
crores). Today it is one of India's fastest growing industrial sectors. Between 1999 and 2004, the Indian bottled water market grew at a compound annual growth rate (CAGR) of 25 per cent - the highest in the world.
With over a thousand bottled water producers, the Indian bottled water industry is big by even international standards. There are more than 200 brands, nearly 80 per cent of which are local. Most of the small-scale producers sell non-branded products and serve small markets. In fact,
making bottled water is today a cottage industry in the country. Leave alone the metros, where a bottled-water manufacturer can be found even in a one-room shop, in every medium and small city and even some prosperous rural areas there are bottled water manufacturers.
Despite the large number of small producers, this industry is dominated by the big players - Parle
Bisleri, Coca-Cola, PepsiCo, Parle Agro, Mohan Meakins, SKN Breweries and so on. Parle was the first major Indian company to enter the bottled water market in the country when it introduced Bisleri in India 25 years ago.
The total annual bottled water consumption in India had tripled to 5 billion liters in 2004 from 1.5 billion liters in 1999. Global consumption of bottled water was nearing 200 billion liters in
2006.
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Government failure to address basic
services
Millions of people, both in rural and urban India, suffer from inadequate or no tap water
supply. Even some parts of Mumbai, the country's financial capital, get a mere two hours of daily water supply. The city's Virar suburb gets 45 minutes. So bottled water is much in demand by residents - even though the businesses profiting from the sales are thriving from access to public water sources.
Bottled water fills a void created by government failure to address basic services, Peter Gleick of the Pacific Institute writes in its World Water report.
"In many parts of the world, tap water is not available or safe to drink," writes . "In these regions, the failure of governments to provide basic water services has opened the door to private companies and vendors filling a critical need, albeit at a very high cost to consumers."
The institute reasons that governments should tap into spending on commercial water by consumers to secure funds to provide safe water at fraction of the cost.
Gigi Kellett, US national director of the Think Outside the Bottle campaign, argues that demand for bottled water is due to industry creating "a market by casting doubt on the quality of tap water, when in fact bottled water is subject to far less scrutiny and often comes from the same source".
Water resources
over-exploited
The majority of the bottling plants are dependent on groundwater. They create huge water stress in the areas where they operate because groundwater is also the main source - in most places the only source - of drinking water in India. This has created huge conflict between the community and the bottling plants.
Private companies in India can siphon out, exhaust and export groundwater free because the groundwater law in the country is archaic and not in tune
with the realities of modern capitalist societies. The existing law says that "the person who owns the land owns the
groundwater beneath". This means that, theoretically, a person can buy one square metre of land and take all the groundwater of the surrounding areas and the law of land cannot object to it. This law is the core of the conflict between the community and the companies and the major reason for making the business of bottled water in the country highly lucrative.
Take for instance the case of Coca-Cola's bottling plant in drought-prone Kala Dera near Jaipur. Coca-Cola gets its water free except for a tiny cess (for discharging the wastewater) it pays to the State Pollution Control Board - a little over Rs.5,000 a year during 2000-02 and Rs.24,246 in 2003. It extracts half a million litres of water every day - at a cost of 14 paise per 1,000 litres. So, a Rs.10 per litre Kinley water has a raw material cost of just 0.02-0.03 paise. (It takes about two to three litres of groundwater to make one litre of bottled water.)
On April 7, more than 1,500 villagers defied a police cordon and marched to Coca-Cola's bottling plant in Mehdiganj village,
Varanasi, in Uttar Pradesh state, demanding that the company immediately shut down its bottling plant. In January, the New Delhi-based Energy and Resources Institute (TERI) advised Coca-Cola to shut a bottling plant in
the drought-stricken state of
Rajasthan.
India's Ministry of Water Resources has ranked 80% of ground water resources in
Rajasthan as "over- exploited" and nearly 34% resources as "dark/ critical", the gravest ranking across the country.
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Bottled
water
companies earn extraordinary profits
Up to 40% of bottled water comes from the same source as tap water, but is sold back to consumers at hundreds of times the cost, says the website of the North American "Think Outside the Bottle" campaign.
Not only the Coca-Cola but
there are thousands of brands in India's
$445 million packaged water industry. "Whatever figures you
come across in the bottled water business would be
underestimated," says Chandra Bhushan, associate director
of the New Delhi-based Center for Science and Environment
that campaigns to protect ground water resources. He said
companies earn extraordinary profits by selling water at 10
rupees (24 US cents) or more per liter after a production cost
of 25 paise, or 0.25 rupee per liter. The water is drawn
mostly from public sources.
Not just bottlers are involved. In south India, thousands of fuel trucks converted to be water carriers sell ground water to households
and establishments at about $10 for 5,000 liters. More than 13,000 tankers carry water drawn from farmland surrounding
Chennai, according a social activist R Srinivasan. He estimates a $148 million tanker industry is cashing in on Chennai's acute water scarcity. The story is replicated
across India, including in New Delhi. |
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Variety of
packages
Bottled water is sold in a variety of packages: pouches and glasses, 330 ml bottles, 500 ml bottles,
one- litre bottles and even 20- to 50-litre bulk water packs. The formal bottled water business in India can be divided broadly into three segments in terms of cost: premium natural mineral water, natural mineral water and packaged drinking water.
Premium natural mineral water includes brands such as Evian, San Pelligrino and Perrier, which are
imported and priced between Rs.80 and Rs.110 a litre. Natural mineral water, with brands such as
Himalayan and Catch, is priced around Rs.20 a litre. Packaged drinking water, which is nothing but treated water, is the biggest segment and includes brands such as Parle Bisleri, Coca-Cola's Kinley and PepsiCo's Aquafina. They are priced in the range of Rs.10-12 a litre.
Bottled water top players
Top multinational players such as Coca-Cola and PepsiCo have been trying for the past decade to capture the Indian bottled water market. Today they have captured a significant portion of it. However, Parle Bisleri continues to hold 40 per cent of the market share. Kinley and Aquafina are fast catching up, with Kinley holding 20-25 per cent of the market and Aquafina approximately 10 per cent. The rest, including the smaller players, have 20-25 per cent of the market share.
The western region accounts for 40 per cent of the market and the eastern region just 10. However, the bottling plants are concentrated in the southern region - of the approximately 1,200 bottling water plants in India, 600 are in Tamil Nadu. This is a major problem because southern India, especially Tamil Nadu, is water starved. |
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The
anti-bottling protests
The
anti-bottling protests in India echo increased concern in
Europe and the United States over the proliferation of bottled
water, including the creation of billions of soon unwanted
plastic containers. In India, protests against the bottling plant in drought-prone Kala Dera near Jaipur
focus on the source of the packaged water and how bottling
companies are grabbing underground water. |
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Plastic Bottles Pollution:
Tap water is a local product that needs no packaging. Globally, bottled water
accounts for as many as 1.5 million tons of plastic waste annually, according to
the Sierra Club. In addition, billions of bottles end up in the ground every year. Sadly, only
20% ever get recycled, according to the Container Recycling Institute. The other
80%? Besides landfills, many bottles end up in oceans, posing a risk to marine
life. By purchasing bottled water, you’re indirectly raising the price of
gasoline and contributing to global climate change.
In 2007, the manufacturers of plastic water bottles generated more than 2.5
million tons of carbon dioxide emissions and required the equivalent of more
than 17 million barrels of oil, according to the Pacific Institute.
Americans drank more than 30 billion single-serving bottles of water last year.
Yet the vast majority of us have an unlimited source of clean, EPA-regulated tap
water flowing from our faucets.
Plastic Bottles requires costly Oil:
Making the plastic in the bottles requires 47 million gallons
of oil annually. And that doesn’t include the jet fuel and gasoline required to
transport the bottles—sometimes halfway around the world.
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Pro-tap water
consciousness
The London Evening Standard newspaper ran a "Water on Tap" campaign in April to have tap water available for drinking in city restaurants and bars. The tabloid reported getting support for its anti-packaged water campaign from the London Chamber of Commerce and Industry, the mayor's office, leading restaurants and chains such as Starbucks, Costa Coffee and McDonald's. Following growing pro-tap water consciousness, bottled water sales in Britain dipped 9% in the year to March 08, estimates London-based retail analysts TNS.
Economists at the California-based Pacific Institute that estimated the $100 billion value of the global industry, ask why consumers are readily paying for bottled water typically costing a thousand times more per liter than high-quality municipal tap water.
"Are consumers willing to pay this price because they believe that bottled water is safer than tap water?" Pacific Institute experts ask. "Do they have a real taste preference for bottled water? Or is the convenience of the portable plastic bottle the major factor? Are they taken in by the images portrayed in commercials and on the bottles?"
Health Issue- Purity of bottled water
City water systems must issue “right to know” reports about what’s in the water.
Bottlers successfully killed this requirement for bottled water. Up to 70% of
bottled water is unregulated by the Food & Drug Administration.
Acceptance of the supposed purity of bottled water is being undermined in India by the government Health Department's warning of pesticides and contaminating organisms being present in some bottled products.
The notion that commercial products taste better has also taken a knock from Decanter, a British magazine, which last December featured top wine tasters testing unmarked samples of water from 22 brands, along with tap water from utility company Thames Water and water from the Decanter office water cooler.
The Decanter panel ranked serviced tap water third in the list, above the world's leading brand, Evian (15th), and the world's most expensive bottled water 420 Volcanic (18th) and Bling H20 (22nd out of 24 brands tasted). 420 Volcanic sells at $99 a liter, and Bling H20 (in Swarovski crystal-studded bottles) at $79 a liter. Decanter
editor Guy Woodward said the tasting test exposed the "outrageous" prices of mineral water.
Traditional Indian methods of
cooling and purifying water
Now people of India
turning their backs on the country's ancient methods of cooling and purifying water. Stored in earthen pots, for instance, it is not only refreshingly cool and tasty but is said to become bacteria-free. Yet the common summer sight of water matkas (earthen pots) in public offices and spaces is giving way to upturned plastic drums dispensing packaged water.
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