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Introduction
Water is the most important necessity for life.
The drinking-water needs for individuals vary depending on the climate, physical activity and
the body culture. but for average consumers it is estimated to be about two
to four litres per day. The growing number of cases of water borne diseases, increasing water pollution, increasing urbanization,
increasing scarcity of pure and safe water etc. have made the bottled
water business just like other consumer items. Scarcity of potable and wholesome water at railway stations, tourists
spots, and role of tourism corp. etc. has also added to the growth.
Almost all the major international and national brands water bottles
are available in Indian market right from the malls to railway stations,
bus stations, grocery stores and even at panwala's shop. Before few years bottle water.
was considered as the rich people's choice, but now it is penetrated
even in rural areas. The growth and status of Indian Bottled Industry
in comparison with Western or Asian market, India is far behind in terms of
quantum, infrastructure, professionalism and standards
implementation. The per capita consumption of mineral water in India is a mere 0.5-liter compared to 111 liter in Europe and 45-liter in USA.
Also As per UN study conducted in 122 countries, in connection with water quality,
India's number was dismal 120. In comparison to global standards India's bottled water segment is largely unregulated.
Former President Dr. A.P.J. Abdul Kalam has urged youngsters
on July 17, 2010 to be aware of water conservation techniques to avoid grave water crisis in future."It is so sad that today, people are forced to buy water in
plastic bottles. I am told that bottled water industry is worth nearly 10000 crore rupees and even big companies like the Coke and Pepsi are involved in this bottling of water and making money. So, it is imperative that we ought to save water," he added.
Do not be surprise if today's bottles water industry becomes next Oil industry by 2025.
Bottled Water Industry in India
Water Shortage and Health Awareness Driving Bottled Water Consumption in India.
The Indian market is estimated at about Rs 1,000 Crore and is growing at whopping rate of 40 per cent. By 2010, it will reach Rs 4,000 -5,000 Crore with 33 per cent market for natural mineral water.
According to a national-level study, there are more than 200 bottled water brands in India and among them nearly 80 per cent are local brands. 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.
While India ranks in the top 10 largest bottled water consumers in the world, its per capita per annum consumption of bottled water is estimated to be five litres which is
comparatively lower than the global average of 24 litres. 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. 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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Bottled water top players in India
The top
players in bottled water industry in India are the major international giants like Coca cola, Pepsi, Nestle and noticeable presence of national players like Mount Everest, Manikchand,
Kingfisher, Mohan Meakins, SKN Breweries , Indian
Railways so on. With increasing competition, this sector will register a robust growth in 2010, predict industry analysts.
To take on rivals in this sector, PepsiCo India is drawing up a fresh game plan which
includes, investment in capacity enhancement, packaging initiatives and
below-the-line activities to pump up volumes in the over-crowded category.
Meanwhile, swadeshi major Parle Agro is extending the manufacturing facility for
Bailley from 29 to 60 plants this year. While swadeshi major Bisleri
International is beefing up its distribution, manufacturing and marketing
operations, Coca-Cola India is sharpening its focus on packaging initiatives of Kinley to woo new consumes. In essence, the packaged water industry in India
will soon witness a major tussle between swadeshi and videshi players to gain market and mind 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. But a major problem is southern India, especially Tamil Nadu, is water starved.
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. |
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History of Bottled water in India
Mineral bottled water in India under the name 'Bisleri' was first introduced in
Mumbai by Bisleri Ltd., a company of Italian origin in 1965. Mineral bottled water were in
glass bottles in two varieties - bubbly and still in 1965 This company was started by Signor Felice
who first brought the idea of selling bottled water in India.
Parle bought over Bisleri (India) Ltd. In 1969 and started bottling
Mineral water in glass bottles under the brand name 'Bisleri'. Later
Parle switched over to PVC non- returnable bottles and finally advanced to
PET containers. Since 1995 Mr.Ramesh J. Chauhan has started expanding Bisleri
operations substantially and the turn over has multiplied more than 20
times over a period of 10 years and the average growth rate has been
around 40% over this period. Presently it have 8 plants and 11 franchisees
all over India. Bisler command a 60% market share of the organized market.
Currently, Bailley has a national presence in 5 lakh retail outlets across the
country. “We plan to increase manufacturing plants for Bailley from 29 to 60,
presently 40 plants are operational and few more will be ready for operations
over the next few months,” informed Nadia Chauhan, joint managing director of Parle Agro. |
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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 major Bisleri International plans to launch fruit-flavoured water before the start of the festive
season this year, a top company official said. Bisleri, which enjoys 65 per cent market share in the branded water segment, is
also eyeing a sharp growth in sales during the festive season that begins from August
Why Bottled water?
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".
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Bottled Water: How Safe?
The bottled water industry has spent billions over the past decade to sell you on the idea that bottled water is better than tap water. Well the short answer is they are both unhealthy. One of the most ironic parts of the bottled water tragedy is that the water bottling industry gets the water free, filters it, bottles it and sells it
back to us at 1,900% profit. The ironic part is that tap water is legislated to be 7.0 pH neutral. They first dump a TON of cholrine in the water to kill off all the bad bacteria, this makes it highly acidic.
In India around 100 companies sell an estimated 424 million litres of bottled water valued at around Rs 200 crore in the country annually
. Most bottlers claim that their water is 100 per cent bacteria-free and contains minerals that make it tastier and healthier. But is the water in these bottles really safe to drink? Do they conform to international or national standards?
To find out, the Ahmedabad-based Consumer Education and Research Society (CERS), an independent non-profit institution with a sophisticated product-testing laboratory, recently carried out a detailed study on 13 major brands of bottled water available in the country. The national brands -- Bisleri (separate samples were taken from their units in
Bangalore, Ghaziabad, Calcutta and Baroda) and Bailley (Mumbai and
Surat) -- were selected on the basis of their dominant position in the overall market. Bisil (Mehsana), Golden Eagle (Chennai), Aquaspa
(Mumbai),Saiganga (Ahmednagar), Nirantar (Thane), Trupthi (Chennai) and Yes
(Nadiad) were included because of their regional popularity. To conform to international standards for such testing, 21 bottles of each brand were tested in the CERS laboratory against "analytical" and "sensory" parameters as well as for "microbiological" contamination. To ensure fairness, the results were sent to the individual companies for their comments.
So how safe is bottled water? Not that safe, says the CERS survey. As many as 10 of the 13 brands had foreign floating objects in clear violation of norms. None of the brands tested was free from bacteria although the
consolation is that they were not of the harmful kind. Two of the big brands contained toxic heavy metals much higher than permitted levels.
The term "mineral water" is misleading because our laws do not stipulate the minimum mineral content level required for water to be labelled as such. All this from a sector that is flourishing because of the public fear that water supplied by civic bodies is impure.
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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 high profits
What is amazing is that people are prepared to pay
Rs. 12 for a liter of water-in India especially when the cost of material input (0.25 paisa per liter
excluding labors cost) pales into insignificance before the price of the product.
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.
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.
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
Warming and 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. |
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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.
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.
The truth is, many water companies get their water from sources in developing
countries, such as India and Fiji. In those places, the companies take water
that once belonged to an entire village and buy it for themselves, forcing the
villagers to pay for water that they used to be able to use as a community, free
of charge. Furthermore, local water sources are polluted in these areas by bottling plants
so that the many who cannot afford privatized water have to walk miles and
miles, often through intense heat, just to access clean drinking water.. |
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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.
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?"
The study, conducted by the US-based Earth Policy Institute, says the global consumption of bottled water has grown by 57 per cent over the past five years, despite the fact that the product is often no healthier than tap water and costs up to 10,000 times more. Emily Arnold, the author of
report, says that the $100 billion spent each year on bottled water is nearly
7 times the sum invested in providing safe drinking water in developing countries.
Bottled Water law in India
The term "mineral water" is misleading because our laws do not stipulate
the minimum mineral content level required for water to be labelled as
such. Ahmedabad-based Consumer Education and Research Society
(CERS), an independent non-profit institution with a sophisticated product-testing laboratory, recently carried out a detailed study on 13
major brands of bottled water available in the country. As many as 10 of the 13 brands had foreign floating objects in clear
violation of norms found in the survey. The CERS study indicates that there is an urgent need to revise
standards for bottled water.
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.
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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.
Rainwater is safe, doesn’t bring about adverse effects.
For centuries people have thought rainwater as unsafe, but contrary to their beliefs, as per an Australian study, drinking of
untreated rainwater is safe for human health. The study was conducted under the auspices of eminent researchers from Melbourne’s
Monash University. The entire team took a look at 300 homes that used rainwater collected in water tanks as their primary drinking
source.This endeavor has been described as a world first study that comes in the midst of growing criticism of bottled water.
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Bottled water Manufacturing plant |
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New development in bottled water industry
TN Govt urged to take over the sale of bottled water
The Tamilnadu Water Supply And Drainage Board
(TWAD) Workers Federation on May 15, 2010 suggested the State government take over the sale of bottled drinking
water and make it available at Rs. 2 a litre. The State government which was generating a huge income from sale of Indian made
Foreign liquor (IMFL) through TASMAC outlets should think of making available
good drinking water to people, Federation General Secretary P.H.C.M.Gandhi said here.
The government could earn revenue of Rs 5,000 crore even if it sold water at
Rs. 2 a litre, he said adding that multi-national and private companies selling
packaged drinking water were earning crores of rupees as profit whereas actual
cost of purifying water was less than five paise per litre. TWAD should be fully in charge of surveying, designing, execution and
maintenance of all water and drainage schemes and empowered to collect water and
drainage tax also, he said.
Go Green
In December 2010 at the Copenhagen Climate talks, organizers wanted to go as green as
possible and so they did not provide delegates bottled water and instead offered Copenhagen tap water in corn starch cups.
Close illegal bottled water units, says HC
To prevent the spread of water-borne diseases in summer, the Delhi high court has directed the government to tighten the noose around
illegal units manufacturing and selling bottled drinking water on May 31, 2010.
Justice S Muralidhar directed government agencies to crack down on units
manufacturing and selling drinking water without a licence and Bureau of
Indian Standards (BIS) certification. It also constituted a committee
for the purpose.
The HC was hearing a petition filed by Bottled Water Processors
Association. The association moved the court, alleging there are a large
number of units in Delhi not complying with norms.They also claimed that despite the central government’s attention being
drawn to illegal manufacturers, no action was taken to stop such activities. HC constituted a task force against units without a licence
and BIS certification.
Formation of Indian Beverage Association (IBA)
In July 2010 rivals Coca-Cola and PepsiCo have come together along with
other beverages makers and bottlers to form the Indian Beverage Association
(IBA), which will be the industry’s single point of interaction with the government and help companies comply with food
safety guidelines and other regulations.
Juices maker Dabur, packaging company Tetra Pak, bottling companies
Pearl Drinks and Bengal Beverages, energy drink maker Red Bull, and drip
and sprinkler systems firm Jain Irrigation Systems too have joined the
association, while about 30-40 others including Bisleri International,
Parle Agro, Amul, Godrej, bottlers, vendors and suppliers are expected to join in due course.
“Non-alcoholic beverages are on a growth trajectory but so far there has
not been a comprehensive organization representing the industry. We felt
it’s time,” said Arvind Varma, secretary general of the association.
He said the organisation will be the non-alcoholic beverages industry’s
single point of interaction with the food safety authority and ministry of health.
It will help members deal with challenges like complying with the food
safety authority guidelines, double taxation, VAT, state-level controversies like allegations of water depletion (as is the case with
Coca-Cola and PepsiCo), sugar imports, spurious drinks and more.
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