Madhya Pradesh has proposed making treated wastewater compulsory for several industrial, commercial and municipal uses under its draft State Level Policy for Recycle and Reuse of Treated Waste Water, 2026. The policy sets reuse targets of 20% by 2027, 30% by 2030 and 50% by 2037.
Chief Minister Mohan Yadav released the draft for public consultation at the Urban Growth Conclave 2.0 in Indore on 28 October 2026. The proposal aims to increase the use of treated sewage and reduce demand for freshwater. It is still a draft and has not come into force.
Why Does MP Want To Reuse Treated Wastewater?
The draft addresses the gap between wastewater treatment and reuse in the state. According to figures reported by The Times of India, sewerage schemes exist in only 64 of Madhya Pradesh’s 418 urban local bodies.
Operational sewage treatment plants have a combined installed capacity of around 1,656 million litres per day. The report says about 1,105 MLD is currently being used. Much of the treated water is discharged into rivers, lakes and drains, while existing reuse is largely limited to gardening, park maintenance and road cleaning.
The state already has a wastewater reuse policy from 2017. That policy recognised treated wastewater as a resource and called for its reuse, including in agriculture. The 2026 draft does not mark the beginning of wastewater recycling policy in Madhya Pradesh. It proposes more specific targets and mandatory requirements for different categories of users.
Which Users Will Have to Use Treated Wastewater?
The 2026 draft proposes compulsory use of treated wastewater, described in the report as Treated Used Water (TUW), for several users.
Thermal power plants located within 50 kilometres of a sewage treatment plant would have to use treated wastewater for non-potable purposes. This requirement already exists under the Centre’s Power Tariff Policy, 2016. The draft therefore builds on an existing central requirement rather than introducing it for the first time.
Construction sites located within five kilometres of a sewage treatment plant or a treated-water filling station would also have to use treated wastewater. The draft proposes supplying it through tankers at fixed charges.
New industrial estates, new units in Special Investment Regions and large industrial units using more than 10 kilolitres of fresh water daily for non-potable purposes would have to use treated water where technically suitable and viable. The draft also proposes linking industries’ consent to operate with the purchase of treated wastewater.
What Will Municipal Bodies and Townships Have To Do?
The draft proposes that municipal bodies use treated wastewater for parks, lake rejuvenation, firefighting and vehicle cleaning. New townships may also have to install dual plumbing systems so that treated water can be used for toilet flushing.
It also proposes restricting the use of freshwater and groundwater for parks, green belts and other non-essential landscaping where treated water is available. In water-stressed areas, authorities may seal borewells used for landscaping if treated water can be supplied instead.
How Will Govt Regulate and Price Treated Water?
The draft proposes a State High-Powered Steering Committee chaired by the chief secretary. The committee would be able to declare areas as “No Freshwater Zones”, allocate treated-water supplies and penalise users who continue drawing fresh water where treated water is available.
A technical cell under the commissioner of Urban Administration and Development would handle approvals, monitoring and quarterly reviews.
The proposed pricing system would vary according to the purpose and quality of water. Industrial and commercial users would pay higher rates, while users requiring higher-grade water would bear the additional treatment cost. The draft proposes keeping treated water cheaper than freshwater.
It also proposes classifying treated wastewater into six quality categories, from A to F, for different uses ranging from park irrigation to industrial processes.
How Will State Fund Proposed System?
The draft identifies central schemes such as AMRUT 2.0 and Namami Gange, state grants, corporate social responsibility funds and viability gap funding as possible sources of finance. It also proposes a dedicated State Treated Used Water Fund.
Private companies could participate through design-build-operate and hybrid annuity models. Proposed incentives include property tax rebates for buildings with on-site wastewater recycling, construction permit fee rebates, leased land for tertiary treatment plants and tradeable reuse certificates.
The draft also proposes safeguards for handling treated water. These include red-coded pipes and covers, labels stating “not fit for drinking” in English and Hindi, separate networks from drinking-water supplies and clearly marked tankers.
What Will Determine Whether Policy Works?
The draft identifies several uses and potential buyers for treated wastewater. The state already has examples of reuse. The Times of India reports that treated water in Gwalior flows into an irrigation canal network. It also reports an agreement in Sagar to supply 10 MLD of treated water to the Madhya Pradesh Industrial Development Corporation.
The draft’s targets will depend on whether treated water can reach the proposed users and meet the quality required for each purpose. Its provisions on supply, pricing, treatment, monitoring and enforcement set out how the state proposes to organise reuse. The draft does not, by itself, establish that the required infrastructure or supply networks are already available.
The government has released the policy for public consultation. Its final provisions and the steps for putting them into effect will depend on the policy adopted after that process.
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