Book Excerpt: Money Where the Mouth Is – Arun Jaitley On Swachh Bharat

Excerpted with permission from The Swachh Bharat Revolution: Four Pillars of India's Behavioural Transformation, Parameswaran Iyer, HarperCollins India.

When John F. Kennedy announced in 1961 that the United States would put a man on the moon by the end of the decade, no one thought it was possible. But it was accomplished in the next eight years. When Narendra Modi declared in 2014 that India would be Open Defecation Free (ODF) by 2019, changing the sanitation behaviour of close to 60 crore people who practised open defecation at the time, no one thought it was possible. Today, less than five years later, India is on the cusp of eradicating open defecation.

Sometimes a big, hard, audacious – and seemingly outlandish – goal set by a strong leader brings out the best in people and institutions. It takes them out of their comfort zone, makes them think big and aim high. It makes them push the boundaries of their imagination by painting a picture of what success will feel like. It motivates them to deliver beyond their pay grade, and punch above their weight, and the sum becomes greater than the parts.

Till 2014, what many of us take for granted – a toilet – was something millions of people in India could not even imagine having access to. Women, particularly in rural areas, wanted toilets, but could not voice their need openly and strongly, and often had to sacrifice it for a television set or a motorcycle. This was the elephant in the room that no one was really addressing seriously.

But as they say, no one can stop an idea whose time has come! No less than the Prime Minister of India issued a war cry against this indignity from the ramparts of the Red Fort in his first Independence Day address to the nation. He still talks about toilets unabashedly at various public gatherings. Suddenly, the ‘unmentionable’ toilet has been placed at the forefront of India’s developmental and political discourse. The Swachh Bharat Mission (SBM) is discussed everywhere, from tea stalls and gram sabhas to panel discussions on national television. This acceptance of a toilet as an important aspect of everyday life that merits discussion, not just locally, but nationally, was a watershed moment in India’s journey to successfully ending open defecation.

To make this ambitious goal a reality, we had to back it up with adequate resources. It could not have been an unfunded mandate. As the Finance Minister of the country, I had the unenviable task of allocating resources to various important Government programmes and sectors, all of which are equally important and deserving of investments. However, unlike previous administrations, for us the overarching importance of sanitation in the wider development of the country was fairly intuitive. As the fastest growing major economy in the world, India is committed to improving the quality of life of its citizens, especially in rural areas. We were already doing a lot of work on enhancing roads and providing electricity and housing, and access to sanitation, which in many ways is fundamental to human development, had to be front and centre of our development plank.

That said, what made my job easier was the understanding that good sanitation is good economics. Not only did poor sanitation undermine the safety and dignity of the women in our country, but it also caused our children to suffer repeated bouts of diarrhoea, which hindered their physical and cognitive development. This would adversely affect the productivity of our nation’s future workforce and what is India’s biggest economic competitive advantage – our demographic dividend. What’s worse was that this had become a vicious cycle. Frequent illness hampers the learning abilities of children, leading to poorer schooling outcomes and the children grow up to have a skill set that is sub-par compared to their true potential. As adults, they are not able to provide better living conditions for their children, who in turn remain stunted or wasted. Stunted or wasted children are less likely to break out of abject poverty.

The World Bank had estimated that the lack of sanitation cost India over 6 per cent of its GDP every year. I believe the gains from investing in sanitation are much higher than any percentage of GDP could articulate. India backed this lofty goal with a handsome budget: over Rs 1.3 lakh crore (over $20 billion) in five years, shared between the Centre and states in a 60:40 ratio (90:10 for special category states). Over 8 crore marginalized households, including all scheduled castes, scheduled tribes, women-headed households, and small and landless farmers were offered a financial incentive of Rs 12,000 to construct a toilet in their homes. Significant allocations were also made in promoting behaviour change through Information, Education and Communication (IEC) activities at the mass media as well as at the inter-personal level. In fact, a recent study by the Bill & Melinda Gates Foundation pegged the leveraged monetary value of the IEC under SBM at over Rs 26,000 crore.

In addition to this large public funding towards improving sanitation, consistent efforts have also been made to leverage investments from the private sector, developmental agencies, faithbased institutions, and even citizens. The Swachh Bharat Kosh has, through private contributions by individuals, companies and institutions, already collected and released over Rs 1,000 crore (~ $150 million) for specific sanitation projects. Several private companies have directly implemented swachhata projects through their corporate social responsibility (CSR) programmes, especially in villages surrounding their factory premises, and in schools. Additionally, all the Ministries and Departments of the Government of India have mainstreamed sanitation in their respective sectors. They committed large sums of money from their own budgets for swachhata, amounting to over Rs 30,000 crore for the years 2017–18 and 2018–19.

To put it in a nutshell, India backed its big goal with big money. And the cross sectoral benefits have already begun to show. In 2017, UNICEF calculated that every rural family in an open defecation–free village in India saves an average of Rs 50,000 per year on account of reduced medical expenses, time saved and lives saved. They also pegged the return on investment for sanitation in India at over 400 per cent. The World Health Organization has said that India will have saved over 3 lakh lives by the time we become an ODF nation in 2019. A study by the Bill & Melinda Gates Foundation found that the number of children with diarrhoea and worms in their stool was 32 per cent and 44 per cent less respectively in ODF villages than in non-ODF villages in India. The number of stunted and wasted children is also 15 per cent and 37 per cent less in ODF villages as compared to non-ODF ones. In 2019, UNICEF estimated that an ODF village was almost 11.25 times less likely to have its groundwater sources contaminated. But probably the most significant outcome of SBM is the positive effect it has had on various other sectors of development and corresponding Government programmes. It is already increasing the effectiveness of the Integrated Child Development Services and the Beti Bachao Beti Padhao initiative by improving the nutrition intake capacity of children, and will enhance the productive potential of India’s next generation of young people, adding tailwinds to programmes like Skill India and Make in India, among others.

SBM has fostered a thriving sanitation ecosystem, creating market opportunities for crores of skilled and unskilled labourers, and has also thrown up entrepreneurship opportunities across the country. According to a report published by the Toilet Board Coalition in 2017, the sanitation industry in India was estimated at approximately $32 billion, and set to increase to $62 billion by 2021. These figures are augmented by a number of factors like job creation, increased demand and supply of sanitation equipment and systems, recycling of sanitation waste, etc. The massive improvement in the sanitation coverage of India has resulted in direct employment opportunities for masons, labourers and industries involved in supplying sanitary ware, as well as for associated sectors like cement, bricks, etc. On an average, building a toilet requires one mason and two labourers to work for three days, nine person days of work. For construction of the over 9 crore toilets so far under SBM, over 80 crore person days of employment has been generated. If one person-year of work comprises 200 working days, this comes to over 40 lakh person years of work – a full-time job for 40 lakh people for a year each. An average twin-pit toilet needs approximately 1,000 bricks to construct. This means toilets under SBM-G have used over 9,000 crore bricks! Approximately 100 kg of cement is used per toilet, meaning toilets under SBM have resulted in the use of over 90 lakh tonnes of cement.

While the construction of toilets has had massive implications for the economy, their maintenance, repair and retrofitting will continue to be a major chunk of the market. As aspirations grow, people will want to further upgrade their toilets, and also add bathing facilities. The Toilet Board Coalition also estimates that once households have a toilet, they spend another 52 per cent of the cost of the original toilet on upgrades and accessories over time. This enormous sanitation ecosystem has created a huge opportunity for banks and financial institutions as well to finance individuals and communities that are borrowing to build personal or community-level infrastructure for solid and liquid management and water over and above the Government funding. To further promote easy borrowing for sanitation, the Ministry of Finance is working with the Ministry of Drinking Water and Sanitation to devise a Swachh Credit scheme, which will provide simple and easy-to-process sanitation loans to individuals and communities, and especially to sanitation entrepreneurs looking to convert waste to wealth in the fields of solid waste collection and management, faecal sludge management, and recycling and reuse of greywater.

Guided by unwavering political leadership, strengthened by crosssectoral partnerships and driven by massive people’s participation, the engines of SBM have been fuelled by public financing. The Mission’s achievements make each and every Indian proud. Nowhere in the world has such a large population been mobilized to bring about such massive behaviour change in such a short span of time. India has now become the global leader of the war against open defecation, with several countries wanting to learn from our experience and implement similar programmes in their countries. What started off as a surprise announcement on Independence Day five years ago has spiralled into the biggest jan andolan in independent India.

Arun Jaitley was Union Minister for Finance, Government of India, between 2014 and 2019.

The views expressed here are those of the author and do not necessarily represent the views of BloombergQuint or its editorial team.