Odisha unveils new policy for R
The Odisha government on Tuesday notified a new policy on re-use of treated used water in urban areas of the state to strengthen water security and promote sustainable resource management. It laid out an ambitious roadmap to transform urban waste water into a productive economic resource.
The ‘Policy on Reuse of Treated Used Water of Urban Odisha, 2026’ – one of the most comprehensive water reuse frameworks launched by any state – seeks to address the increasing seasonal and spatial water stress in urban areas while advancing the principles of circular economy and climate resilience.
The new policy, formulated by the Housing and Urban Development (H&UD) department, sets clear and time-bound targets for urban local bodies (ULBs) across the state. It aims to ensure 100 percent collection, transportation and treatment of used water by 2030, as well as reuse of at least 20 percent of treated water by the same year.
The state government has set a long-term target of increasing the reuse of treated water to a minimum of 50 per cent by 2036, marking a transformational change in urban water governance. In cities where sewerage systems and sewage treatment plants are already functional, at least 20 per cent reuse of treated water will be achieved within six months.
Currently, Odisha generates about 1,104 million liters per day (MLD) of used water, but only 190 MLD is being treated. With rapid urbanization, industrial growth and increasing pressure on freshwater reserves, reusing treated water is expected to reduce dependence on rivers, reservoirs and groundwater sources, especially during the summer months when many urban centers face water shortages.
Officials said the initiative recognizes treated wastewater as a valuable secondary water source rather than as waste. “The policy is designed to bridge this substantial treatment gap by expanding sewerage and treatment infrastructure, ensuring universal access to waste water treatment systems and mandating compliance with prescribed quality and safety standards for re-use in non-potable areas,” an H&UD department official said.
This policy will focus on a wide range of areas where treated water can be used safely. In the municipal and institutional segment, treated water will be encouraged for road cleaning, fire fighting, sanitation, gardening, maintenance of parks and heating, ventilation and air conditioning (HVAC) systems in large establishments.
The treated resource can be used in power plants, cooling systems, boiler feed, construction activities and process water requirements in the industrial sector. For the agriculture and environment sector, the policy promotes its use in irrigation, wetland restoration, rejuvenation of urban lakes and ponds and maintenance of green belts.
The State Government has also introduced an innovative TUW tariff model under which the price of treated used water will be lower than potable freshwater to ensure market acceptance and demand generation. The pricing mechanism is aimed at making treated water commercially attractive for industries, institutions and municipalities, the official said.
The H&UD department has proposed a series of incentives to accelerate adoption. Farmers will receive water credits for using treated water for irrigation, while industries can take advantage of tariff exemptions and Viability Gap Financing (VGF) support to optimize infrastructure. Similarly, residential societies using treated water for flushing, landscaping and common area maintenance will get exemption. Performance linked incentives and disincentives have also been included in the framework to improve compliance and accountability.
A strong governance mechanism has been created for proper implementation of the policy. A State High Powered Committee (HPC) will act as the apex body for policy direction, pricing decisions and inter-departmental coordination. It will be supported by a State-level Technical Committee (LTC) and a dedicated treated used water cell to handle planning, monitoring and technical support. District Coordination Committees (DCCs) will facilitate demand aggregation, local participation and implementation at the field level.
As per the policy framework, the H&UD department will serve as the nodal authority for regulation, standards and policy oversight. Agencies such as Odisha Water Supply and Sewerage Board (OWSSB), WATCO and Public Health Engineering Organization (PHEO) will be responsible for the development, operation and maintenance of the infrastructure. Odisha Urban Academy (OUA) will lead capacity building, training, innovation and research.
Urban development experts said the policy could significantly reduce freshwater demand in growing cities like Bhubaneswar, Cuttack, Rourkela, Sambalpur, Berhampur, Balasore and Angul, where industrialization, population growth and infrastructure expansion are putting pressure on traditional water sources. Reuse of treated water can also help reduce pollution loads entering rivers and streams by ensuring more wastewater treatment.
The policy is in line with the objectives of the National Framework on Safe Reuse of Treated Water, 2023 and AMRUT 2.0, positioning Odisha as a leading state in integrated urban water management.
