World’s Biggest Toilet-Building Spree Is Windfall For Companies
(Bloomberg) -- India is on the greatest toilet-building spree in human history, and it’s a windfall for companies.
Prime Minister Narendra Modi’s $20 billion “Clean India” mission aims to construct 111 million latrines in five years. Besides promising to improve the health, safety and dignity of hundreds of millions of Indians, the national hygiene drive has spurred an 81 percent jump in sales of concrete building materials and 48 percent increase in bathroom and sanitaryware sales, according to Euromonitor International. That’s benefiting firms from Tata Group, the nation’s largest conglomerate, to cleaning-products maker Reckitt Benckiser Group Plc.
Almost 80 million household toilets are estimated to have been built since Modi’s 2014 pledge to ensure universal sanitation coverage by October 2019, which will mark 150 years since the birth of independence leader Mahatma Gandhi. The scale-up of latrines and a nationwide campaign to encourage their use is driving a market for toilet-related products and services that’s predicted to double to $62 billion by 2021.
“It’s the biggest, most successful behavior-change campaign in the world,” said Val Curtis, director of the London School of Hygiene and Tropical Medicine’s Environmental Health Group, who has worked on the program in India. “Every time I go there, I feel like I can’t sit down for weeks after because I’m excited about what they’re doing. It’s incredible.”
Bollywood celebrity Akshay Kumar, star of the sanitation-promoting movie “Toilet: Ek Prem Katha” (or “Toilet: A Love Story”), was appointed brand ambassador this month for Harpic, the bowl-cleaner made by Reckitt Benckiser. The Slough, England-based company, which also sells the disinfectant Dettol, dominates the toilet-care market in India, with sales climbing 11 percent to $105.7 million last year, Euromonitor data show.
“We are one of the most trusted brands in India, and we’ve always managed to outperform the market with Dettol,” Rakesh Kapoor, Reckitt Benckiser’s India-born chief executive officer, said on a conference call in April. The company has been able to increase awareness of its cleaning products by working with open-defecation-free communities and households to promote sanitation and hygiene.
That’s a common theme across suppliers of home-care products, according to Sowmya Adiraju, a research analyst at Euromonitor in Bengaluru. For example, Hindustan Unilever Ltd. entered the low-cost toilet cleaner market with a new powdered product, and has been trying to make toilets accessible and affordable through its Domex Toilet Academy.
Companies are investing heavily on spreading awareness about better hygiene products, aiding the penetration of home care products in India, which is still low by global standards, Adiraju said in an email.
The “Clean India” mission has had a “largely positive” impact on suppliers of sanitaryware and tiles, sales of which are predicted to expand about 11 percent annually through 2022, according to Adiraju. The sanitation campaign was anticipated initially to provide a bigger sales boost, but some companies have partnered with governments more as a social initiative than a business opportunity, she said.
Before Modi began the Clean India program, known locally as the Swachh Bharat Abhiyan mission, the country accounted for more than half of the world’s 1.1 billion people who routinely relieve themselves in fields, beaches and other open spaces.
So-called open defecation contaminates food and drinking water, and spreads diarrheal diseases that cause chronic malnutrition and childhood stunting -- a burden the World Bank estimated costs India 6.4 percent of its gross domestic product.