Private sector participation in the water and sanitation sector

This paper aims to provide an overview of the principles that should underlay private sector participation in the water and sanitation sub-sector to help inform the Department For International Development (DFID), together with other stakeholders, on the role and potential of Private Sector Participation (PSP) in its broadest sense and to provide suggestions on what approaches might be appropriate to the programmes of DFID and those of others in low and lower-middle income countries. This paper examines the urban and rural drinking water supply and sanitation sub-sector. It is estimated that 91 per cent of total water consumption (in developing countries) is used in agriculture and therefore fears over future water scarcity have overwhelming relevance, at the sectoral level, to the irrigation sector. It is suggested that there is an urgent need to consider the pricing of irrigation water as an economic good to protect the higher value supply to drinking water.