Contaminated water and poor sanitation are linked to the transmission of diseases including cholera, diarrhoea, dysentery, hepatitis A, typhoid and polio. As such, the United Nations’ Sustainable Development Goal 6 (SDG 6) seeks to ensure safe drinking water and sanitation for all by the year 2030. Both services fall under the domain of the provinces and are managed by local governments, and are generally in a state of despair. They may not be able to achieve their targets as the current governance system has become outdated and is on the verge of collapse.
Service delivery of the Karachi Water and Sewerage Corporation (KW&SC) has always remained on the radar of the Government of Sindh (GoS) and citizens, as frequent bouts of irregular supply, unfiltered and contaminated water, open manholes, overflowing drains and the direct disposal of 470 million gallons of untreated water into the sea have become a normal routine. No wonder the city sits at the bottom of livability and competitiveness rankings in the world. The situation in other towns in the interior of Sindh is even worse, as sewage water is being discharged into irrigation canals, which are used downstream for drinking purposes by humans as well as animals, due to the fact that a large part of Sindh has no underground sweet-water source.
To examine the issue and suggest a road map for water and sanitation of the metropolitan city, the Japan International Cooperation Agency (JICA) undertook extensive field and data collection work spread over three years (2005–2008) and produced a comprehensive Master Plan for Karachi containing eight volumes. It identified four major problems of the water body: (a) poor conditions of the water distribution system, (b) lack of autonomy, (c) weak financial capacity, and (d) absence of measured supplies and volumetric charges. It recommended restructuring the water body into three hydraulic zones under a corporate company for each zone, West, Central and East, to handle retail matters and undertake massive Distribution Network Improvement (DNI).
The plan proposed the West Zone for areas on the right side of the Lyari River, the Central Zone for the territory between the two rivers, Lyari and Malir, and the East Zone consisting of areas across the Malir River. It recommended restricting the role of the KW&SC to bulk water-related matters only. The GoS, instead of implementing the recommendations of JICA, opted for the usual bureaucratic-led management to improve the performance of Karachi’s water utility and signed a Commitment of Cooperation (CoC) in 2019 with international development banks to provide funds under sovereign guarantees to the KW&SC. The total cost of the package is 1.6 billion dollars and is being financed 80 percent by two donors (640 million dollars each) and 20 percent by the GoS.
The reported progress within eight months of the establishment of “Suthra Punjab” under the Lahore Waste Management Company, a public–private alliance, highlights the power of the right partnership and the important role of private stakeholders
The Karachi Water and Sewerage Services Improvement Project (KWSSIP-1), known as SOP1, costing 100 million dollars, was planned for completion by June 2025 and is the first in a series of four projects (SOPs). A separate Project Implementation Unit (PIU), with human resources and equipment, was established to support the implementation process. However, despite the PIU, most of the targets, including metering all bulk consumers, reducing Non-Revenue Water (NRW), lowering operational and maintenance costs, improving the gender ratio in employees, and updating the Master Plan, were missed. As such, the project has been extended till June 2026 but with reduced targets, including just 110 kilometres of DNI works till 2030 (JICA had proposed 6,000 kilometres of DNI). A perusal of the implementation and results report issued by the participating donor in October 2025 displays a very poor picture of the state of the project. The likelihood of sustainable success for the water body appears very bleak unless innovative policy actions are taken.
Against the background of this dismal performance, the reported progress within eight months of the establishment of “Suthra Punjab” under the Lahore Waste Management Company, a public–private alliance, highlights the power of the right partnership and the important role of private stakeholders. “Suthra Punjab”, through the right alignments, has within a very short time been able to collect and process 50,000 tonnes of waste per day from across the province through a web-based, digitally connected system for 130 million people. Daily waste collected is being converted into electricity, and carbon credits are being earned. The most important feature of the whole process is the fact that this is a home-grown solution achieved without sovereign guarantees, through a partnership between the private sector, a local bank and a proactive team of the provincial government of Punjab.
The GoS in the past had entered into landmark partnerships with the private sector and civil society, including the initiative of the Sindh Engro Coal Mining Company (SECMC), which resulted in the generation of more than 2,600 megawatts of electricity from the Thar coal mines and brought substantial foreign investment and employment to the area, and the reconstruction of a 60-kilometre road between Hyderabad and Mirpurkhas through a Korean developer. This could have been extended to the historic Khokhrapar border with the eastern neighbour if Sindh like Punjab and other regions, had been allowed the privilege of border trade.
The same Korean investor also participated in the tender for the Karachi–Thatta motorway, but a well-known local party was awarded the contract. Successful partnerships with civil society include those with the Sindh Institute of Urology & Transplantation (SIUT) and the People's Primary Healthcare Initiative (PPHI) in health; the Adopt-a-School initiative with civil society in education; women’s empowerment and poverty alleviation with the Sindh Rural Support Organisation (SRSO); and the promotion of culture and the protection of heritage with the Endowment Fund Trust for the Preservation of Heritage (EFT), among many others in different areas. These partnerships were concluded several years ago and are still working smoothly.
At one time, The Economist ranked Sindh Province at the top of the public–private partnership list in the region, but dents in the policy emerged when advanced plans to construct another canal from the Hub Dam were switched from public–private partnership to the usual practice of civil contractors paid out of public funds. In an earlier episode, the withdrawal of an Asia-based bank from a major road project also raised eyebrows about transparency.
There are several instances where, through a display of political will, reforms were initiated which brought positive improvements in the quality of services and finances. Facing a Karachi-like situation in Manila, the Metropolitan Waterworks and Sewerage System (MWSS), a public utility similar to the KW&SC, was virtually bankrupt. In 1997, the Government of the Philippines took a bold initiative, undertook structural reforms, appointed the International Finance Corporation (IFC) as the transaction advisor, divided MWSS into East and West Zones, and after a competitive bidding process offered them to two separate consortiums of private-sector companies Manila Water Company and Maynilad Water Services on 25-year concession agreements, with the condition that both would invest in infrastructure and repay all outstanding foreign loans of more than 800 million dollars.
Reliable, 24/7 safe water and sewage services for the people are possible, provided timely, bold and innovative policy decisions are taken
After initial challenges, both companies made substantial improvements in service delivery, reduced NRW losses, repaid all foreign loans and liabilities, and have been granted an extension of the concession agreement. Manila Water Company has been traded on the Manila Stock Exchange since 2005 and covers 24 cities and municipalities of the East Zone of Metro Manila and the Province of Rizal, with operations in other countries including Vietnam, Thailand, Indonesia and Saudi Arabia. Maynilad has also improved its services and is providing water and sewage services in the West Zone of Metro Manila and several surrounding areas.
In Brazil, where procurement reforms began in the 1970s, CESAN, a joint venture between the state government of Espírito Santo and the private sector, provides quality services in 53 municipalities through concession contracts. It has 92 water-treatment plants and 104 sewage-treatment plants, serving 73 percent of the state’s population. In another state, São Paulo, SABESP, a joint-venture company with the state government, provides water supply, sewage collection and treatment services in more than 375 cities and towns. It has a Fitch rating of AAA(bra). The state owns 18 percent of the company, 20 percent is held by the general public, and the rest by institutions. It is traded on the New York Stock Exchange with the ticker ‘SBS’, and on the Brazilian Stock Exchange with the ticker ‘SBSP3’.
Reform is not “one size fits all”, but there can be different modes to reach the ultimate aim of providing better services to people. In Cambodia, the Phnom Penh Water Supply Authority transformed the capital’s water utility, supplying clean drinking water on a 24/7 basis and reducing NRW losses from 72 percent to just 8.75 percent. It is traded on the Cambodia Securities Exchange with the code ‘PWSA’.
In Ho Chi Minh City (Saigon) in Vietnam, the city water agency, Saigon Water Corporation (SAWACO), was facing 40 percent water loss due to leakages. It started performance-based contracts (PBCs) for NRW, focusing on leakage reduction in one of its six hydraulic areas. According to a credible international development bank, a five-year contract worth 15 million dollars established 119 District-Metered Areas (DMAs), repaired 15,000 leakages, reduced operating costs and saved 100 million dollars on alternative water-supply sources, which would have otherwise cost 120 million dollars. The Saigon Water Infrastructure Company has been traded on the Ho Chi Minh Stock Exchange since 2012 with the ticker ‘SII’ and has been in a strategic partnership with Manila Water Company since 2013.
The socialist government of Vietnam, under its equitisation policy since 1990, has offloaded a significant share of state-owned enterprises (SOEs) to the private sector in all sectors, including water and sanitation, to reduce direct state ownership and encourage private foreign investment.
While the world has moved on to market-based options, policy-makers in Pakistan remain focused on seeking development loans through state sovereign guarantees, which are placed at the disposal of bureaucracy for utilisation. In addition to massive funding under federal and provincial development programmes, it is hardly surprising that out of 91 billion dollars in external loans, 43 percent is owed to two multilateral development banks, and hardly any investment-friendly policies are enacted to promote investment.
The time has come for Pakistan to reconsider its existing investment and development strategy, and immediately formulate a comprehensive policy to bring the private sector in as a strategic partner in all major development schemes, as well as in government-owned enterprises at the federal and provincial levels. This would help secure market-based quality human resources, updated modern technology, additional private investment, and, importantly, partners whose fortunes are linked to the success or failure of projects. India and Malaysia have transformed their road and transport sectors through partnerships with private investors, while we remain captive to foreign loans and are unable to find investors for the highly lucrative business opportunity of constructing the Hyderabad–Sukkur Motorway.
Karachi, with its population of more than 20 million, strategic location, and commercial and industrial base, has all the necessary characteristics to become a lucrative business opportunity for local and foreign investors in the management of drinking water and sewage services. The GoS may display political will to restructure the ailing KW&SC and other water utilities by bifurcating them into hydraulic zones, incorporating a corporate company for each zone as recommended by JICA including a company for bulk water and a separate company for other cities and towns of Sindh and offering all five corporate entities for public–private partnership through well-prepared, performance-based concession agreements for 25–30 years, under a competitive bidding process and guided by a reputable international transaction advisor with experience in such cases.
Reliable, 24/7 safe water and sewage services for the people are possible, provided timely, bold and innovative policy decisions are taken to usher in a new, people-centred era of service delivery and financial responsibility.