As Indian cities grow, they will need to expand the systems supplying water and managing wastewater. But building more infrastructure is not, by itself, a solution. An equally important question is at what scale that infrastructure should be implemented.
For decades, the dominant answer has been centralisation: bring water from distant sources, treat it at large plants, move it through extensive networks, and collect wastewater into large sewage systems before treating it at centralised plants. Larger systems can exploit economies of scale, standardise operations and concentrate technical expertise.
But these advantages have to be weighed against what happens beyond the plant: the cost of increasingly extensive networks, the risks created by concentrating capacity, and the difficulty of adapting large systems as cities change. The question, therefore, is not whether centralisation or decentralisation is inherently better, but what scale works best for each part of the urban water system—in cost, resilience and its ability to adapt as the city changes.
When Scale Creates New Costs
Mumbai illustrates the trade-off. The city draws more than 3,220 million litres of water a day from outside its boundaries, placing it among the world's major urban centres dependent on cross-basin water transfers. The water then moves through extensive networks, where leakage is estimated between 20 percent to more than 50 percent in some cases. These losses are not simply an engineering problem. They add to the cost of supplying water, increase pressure on already stretched resources and make a sprawling system harder to manage.
Concentrating capacity also concentrates risk. Heavy rainfall that inundated Mumbai's Bhandup water complex, for example, disrupted water supply across the region. A system can therefore be efficient under normal conditions while remaining vulnerable to disruptions at a critical facility—an increasingly important consideration as extreme weather becomes part of infrastructure planning.
Treatment Plant Is Only Part of the Cost
The trade-off becomes sharper with wastewater. Infrastructure planning often centres on the sewage treatment plant: determine the required capacity, select the technology and build the plant. But sewage first has to effectively reach it.
Collection networks can account for 70-80 percent of total sewerage project costs. A large treatment plant may achieve economies of scale while requiring longer sewer lines, more excavation and more infrastructure to maintain over its operating life.
This changes the economic question. Instead of asking only how cheaply wastewater can be treated at a plant, cities also need to ask: how far should sewage travel before it is treated?
Building for Uncertain Growth
Scale also determines how easily infrastructure can respond to urban growth. Cities must plan for future populations and demand, but forecasts are necessarily uncertain. When growth takes longer than expected, large investments can remain underused for years. Many cities in India have sewage treatment plants that are more than 20 years old, yet receive less than 50 percent of the sewage they were designed to treat.
The problem is not planning ahead; it is committing too much capacity to a forecast that may not materialise on schedule. Modular systems offer another approach: build capacity in phases and expand as demand emerges. Investment can follow actual growth, reducing the risk of asking today's users to pay for capacity that may not be needed for years, while allowing cities to learn from one phase before committing to the next.
This does not mean planning less far ahead; it means allowing long-term plans to adjust as demand becomes clearer. The principle is straightforward: plan for growth, but do not lock infrastructure into a forecast.
Smaller Is Not Always Better
Modularity, however, does not imply that smaller is always more efficient. Very small treatment systems can face higher operating costs, limited technical capacity and weaker compliance. Effluent violation rates -- the frequency with which treated wastewater fails to meet prescribed quality standards—for plants of 0.01 million liters per day (MLD) are typically ten times those of plants exceeding 100 MLD, while decentralised treatment systems can be two to three times more costly than centralised systems for the same overall capacity.
The choice, then, is not between a giant central plant and a treatment unit for every neighbourhood. The more useful question is whether there is a missing middle: units large enough to retain operational and economic advantages, but sufficiently distributed to shorten networks, prevent a failure in one part from disrupting the entire system, and allow capacity to be added progressively.
Finding the Right Scale
The configuration of an optimal scale can also change the economics of used water and water circularity. Treating wastewater closer to where it is generated can make reclaimed water easier to use locally because it does not have to be transported long distances to find a user. Wastewater can then be treated not simply as something to dispose of, but as a resource: treated water can be used for irrigation and toilet flushing, while treatment processes can recover phosphorus and generate energy.
But there is no universal size at which these advantages are maximised. The appropriate configuration depends on density, spatial spread, terrain, projected growth, land and water availability, infrastructure costs, opportunities for reuse and institutional capacity.
Nor does every component of the system need to operate at the same scale. Bulk water supply may retain strong advantages from centralisation even where wastewater treatment and recycling can be organised more locally. Different parts of the same city may require different configurations.
That makes scale a planning variable, not simply an engineering specification.
What Should Change in Urban Water Planning?
The first change is in project appraisal. Cities should compare the lifecycle costs of entire systems rather than treatment plants alone. Water sourcing or sewage collection, transmission, treatment, reuse, operation and maintenance, and the consequences of failure all affect whether an apparently economical project remains economical at the system level.
The second is to embed flexibility into investment. Where future demand is uncertain, phased capacity should be evaluated alongside large upfront investments rather than assuming that forecast demand must be provided for immediately.
The third is to plan treatment and redistribution of used water together. Where reclaimed water can be used should influence where wastewater is treated and at what scale, rather than it being considered after treatment infrastructure has already been located.
These changes require centralisation and decentralisation to stop being treated as competing models. The planning question is more practical: which functions should operate at which scale, in which parts of the city, and how easily can that configuration change as demand changes?
The future-ready city may not be the one with the biggest water system. It may be the one whose water system can change as the city does.