Efficiency of Urban Water Supply Utilities in India

The two parameters of services output of water utilities are the per capita water available for consumption and the hours for which water is supplied per day. However, water utilities in India differ on the level of these outputs substantially. This paper uses the data for water utilities in 31 cities to analyse their performance in delivery of services. Using data envelopment analysis, a measure of technical efficiency for various utilities is calculated. The results indicate that water utilities can increase the delivery of water on a per capita basis and increase the hours of supply per day by about 18%. Nearly 37% of the increase in services could result from changing the scale of operation. This paper also discusses if the institutional framework within which these utilities operate has implications on their efficiency.