Material Insights · Understanding the Material World

Construction and infrastructure and Water and sanitation

Water and sanitation is one of the most construction-heavy services: dams, canals, pipelines and treatment plants are civil works, so water programmes turn directly into contractor orders. In India the Jal Jeevan Mission and AMRUT 2.0 make water one of the larger public construction programmes, and the challenge is shifting from building to running what was built.

Construction and infrastructure (industry) and Water and sanitation (industry): 5 relationships.

How they are linked

1. Buys from

Physical flow · ₹8.7 per ₹100 · Water and sanitation buys from Construction and infrastructure

Utilities pay contractors to build and repair mains, sewers, reservoirs and treatment plants, and much routine maintenance is civil work.

  • ₹8.7 of every ₹100 of Water and sanitation output, all rounds (India 2022)
  • ₹5.8 bought directly

This counts current purchases only. New schemes are booked as investment, which is far larger, so construction's real exposure to water spending is much bigger than the table shows.

Sources: OECD

2. Buys from

Physical flow · ₹0.6 per ₹100 · Construction and infrastructure buys from Water and sanitation

Building sites buy water for concrete, curing and dust control, and pay for drainage and sewerage connections.

  • ₹0.6 of every ₹100 of Construction and infrastructure output, all rounds (India 2022)
  • ₹0.1 bought directly

Water is cheap relative to other inputs, so the money is small. The risk is availability: where municipal supply is short, sites must draw groundwater or buy tanker water.

Sources: OECD

3. Industry input

Physical flow · Criticality 5 of 5 · Construction and infrastructure to Water and sanitation

Bulk raw-water and reservoir authorities depend fully on civil contractors to build dams and canals, and water EPC and design-build-operate firms subcontract the civil work.

Without civil construction there is no new water supply capacity, so this dependence is rated at the top of the scale.

Enterprise types that depend on it:

  • Bulk raw-water and reservoir authorities: dams and canals are built by civil contractors (criticality 5 of 5)
  • Water EPC and design-build-operate contractors: civil subcontracting (criticality 3 of 5)

Sources: Material Insights

4. Industry input

Physical flow · Criticality 4 of 5 · Water and sanitation to Construction and infrastructure

EPC and general contractors need water for concrete and site drainage.

A site cannot pour concrete without water, so the input is essential even though it is a small cost.

Enterprise types that depend on it:

  • Bulk raw-water and reservoir authorities: dams and canals are built by civil contractors (criticality 5 of 5)
  • Water EPC and design-build-operate contractors: civil subcontracting (criticality 3 of 5)

Sources: Material Insights

5. Water programmes

Transition · High in India · Water schemes drive construction orders

India's national water missions fund pipelines, storage and treatment through state agencies, and most of that money becomes civil and pipe-laying contracts.

  • ₹8.69 lakh crore total Jal Jeevan Mission outlay, extended to December 2028
  • ₹2.99 lakh crore indicative AMRUT 2.0 outlay for urban water and sewerage
  • ₹67,670 crore Jal Jeevan Mission budget, 2026-27

Central assistance to the Jal Jeevan Mission rises to ₹3.59 lakh crore, and about 15.8 crore of 19.36 crore rural households (about 82%) had tap connections in March 2026. Under AMRUT 2.0, contracts had been awarded for 4,916 projects worth about ₹85,114 crore by December 2024. The 2028 extension lets a village be declared Har Ghar Jal only once the state confirms in-village operation and maintenance arrangements, which moves the focus from building new schemes to running them.

Sources: Prime Minister's Office, Government of India; IANS; Indian Infrastructure

For investors

Key learnings

  1. Water spending in India is mostly public and mostly civil works, so the Jal Jeevan Mission and AMRUT budgets are a direct order book for contractors and pipe makers.
  2. With about 82% of rural households connected by March 2026, the next phase is operation and maintenance, which is a smaller but steadier business than construction.
  3. Construction's own use of water is cheap but essential, so local water shortages can delay sites even when cost is not an issue.

What to track

  • Jal Jeevan Mission and AMRUT budget and releases: Releases below budget slow contractor billing (Annual budget, monthly releases · Ministry of Jal Shakti, MoHUA)
  • Water and sewerage contract awards: Show the size and timing of new civil orders (Monthly · state tender portals, company order books)
  • Share of households with functional tap connections: Signals the shift from building to operating schemes (Monthly · Jal Jeevan Mission dashboard)

For policymakers

Key learnings

  1. India's water missions are among its largest public construction programmes, so their pace affects jobs and demand for pipes, cement and steel.
  2. The 2028 extension ties village completion to working operation and maintenance, recognising that built schemes often fail without upkeep.
  3. Urban sewerage under AMRUT 2.0 is the next large civil task, aiming at universal sewerage and septage coverage in 500 cities.

What to track

  • Contracts awarded against tenders issued under AMRUT 2.0: A wide gap shows execution or contractor capacity limits (Quarterly · MoHUA, Parliament replies)
  • Functionality audits of rural water schemes: Show whether built assets keep delivering water (Annual · Ministry of Jal Shakti)

India

The Jal Jeevan Mission (₹8.69 lakh crore total outlay to December 2028) and AMRUT 2.0 (₹2.99 lakh crore indicative) make water one of India's largest civil construction programmes, now moving from new connections to upkeep and urban sewerage.

Sources

  1. OECD Input-Output Tables 2025 edition, India 2022, OECD
  2. Industry map: Water and sanitation, Material Insights (2026)
  3. Industry map: Construction and infrastructure, Material Insights (2026)
  4. Cabinet approves extension of Jal Jeevan Mission period up to December 2028 with enhanced outlay, Prime Minister's Office, Government of India (2026)
  5. AMRUT 2.0 scheme allocates Rs 66,750 crore to help cities become water secure, IANS (2024)
  6. Building infrastructure capacity: budget allocation across sectors, Indian Infrastructure (2026)