WASH and the private sector

Water, Sanitation and Hygiene (WASH) are essential areas of focus for achieving sustainable development and are a critical component of the global sustainable development goals.

Pakistan’s WASH sector faces significant challenges due to the effects of climate change, driven by population growth, increasing global temperatures, recurring disasters and urbanisation. The public sector has historically played a significant role in advancing WASH, but in recent times, the private sector has begun to support these efforts.

Presently, private-sector organisations are involved in the WASH sector through policy advocacy, technology provision and capacity-building support. However, their contributions are somewhat limited by regulatory barriers, lack of coordination with public sector programmes, and the absence of a cohesive strategy that aligns private sector initiatives with national and provincial WASH strategies.

Public-private partnerships (PPPs) in Pakistan’s WASH sector face significant regulatory and policy challenges that hinder their effectiveness. Complex and inconsistent regulations make it difficult for private sector entities to comply with requirements, secure permits, and navigate bureaucratic hurdles. Many private companies also lack the technical expertise needed to implement sustainable WASH solutions, particularly in rural and underserved areas.

To address these issues, Pakistan must explore best practices from successful WASH projects in other contexts and identify ways to adapt and implement them effectively. Strengthening policy frameworks and reducing regulatory barriers could enhance private sector participation in the sector.

National and provincial WASH policies reveal several gaps that limit their effectiveness in addressing broader development priorities such as poverty alleviation, gender inclusion, and climate resilience. Existing policies take a generalised approach to water infrastructure investment, often neglecting key factors that impact long-term success and sustainability.

A major challenge is the inadequate and unreliable funding allocated to WASH programmes, with many initiatives relying on external donations rather than sustainable financial models. The absence of a strategic policy framework to attract private capital and management resources has also restricted the development of structured and coordinated PPP models. Addressing these financial and strategic deficiencies is important for improving WASH service delivery across Pakistan.

Other key policy challenges include ineffective financing strategies, lack of clear PPP guidelines, and the absence of a structured regulatory framework to support partnerships. The few existing PPP initiatives, such as the Punjab Saaf Pani Project, remain largely uncoordinated and unsupported by regulatory mechanisms. This lack of structure prevents the establishment of a successful PPP model that can be replicated in different regions.

The weak or absent Monitoring and Evaluation (M&E) systems in WASH policies further limit policymakers’ ability to track progress, assess impact, and identify areas for improvement. Strengthening M&E frameworks would ensure that policies align with community needs and optimise resource utilisation, ultimately enhancing the effectiveness and sustainability of WASH initiatives in Pakistan.

In Pakistan, the private sector can take on three types of roles in the development of WASH utilities. First, there is the self-provisioning of water supply, sanitation and hygiene (WASH) facilities, where individuals finance these facilities in both urban and rural settings. Urban areas typically only have public water and sanitation utilities in larger cities, while in rural locations, the construction (and management) of water supply is traditionally the responsibility of local government, which often falls short; thus, households and communities must cooperate to set up these facilities.

Self-provisioning acts as a form of private financing for WASH utilities. In cities, the private sector provides household-level storage, pumping and filtration systems for a fee to enhance the inconsistent and subpar quality of the public water supply. This investment is also funded by individuals for their self-sufficiency regarding these facilities.

Second, a portion of the private sector in Pakistan allocates funds from their Corporate Social Responsibility (CSR) initiatives toward water supply projects. Many family-owned private businesses practice corporate philanthropy as a charitable endeavour, labelling it as CSR. Aside from a handful of large corporate conglomerates, businesses in Pakistan generally lack an understanding of Social Impact Investments (SII) and their obligations concerning environmental, social and governance (ESG) responsibilities.

National and multinational companies in Pakistan must recognise that their utilisation of the country’s resources necessitates a return to society by investing from their SII and ESG portfolios into WASH infrastructure and ecosystem restoration. Some small cooperatives and associations operate informally in both large cities and small towns, often without much security

Third, Public-Private Partnerships (PPP) represent profit-driven investments. Despite the existing federal and provincial PPP frameworks, the private sector rarely invests in this area. This may be due to the lack of clarity surrounding the PPP framework and the perception that the pricing of water, sanitation, and hygiene services extends beyond basic human rights. However, in urban areas, the costs for water, sanitation (including solid waste) and hygiene (in terms of health expenses) facilities are already established within the PPP model or through official water and sanitation agencies (WASA).

Achieving WASH benchmarks in the private sector requires well-defined policies and standards, particularly in water quality, sanitation and hygiene. WASH policies should prioritise monitoring and evaluation, staff training and information sharing among stakeholders. This approach ensures that sustainable and high-quality WASH services are delivered, aligning with Pakistan’s Sustainable Development Goals. Strengthening these aspects will enhance the effectiveness and resilience of WASH initiatives across various sectors.

Governments must ensure sufficient funding for WASH projects by offering incentives to attract private investment. These incentives could include tax exemptions, grants, and operational facilitation through streamlined processes. By making WASH investments more attractive, governments can encourage long-term private-sector engagement, securing the necessary financial resources for sustainable project implementation. This strategic approach can enhance service delivery and improve the overall impact of WASH programmes.

Establishing partnerships with NGOs and international organisations is essential for expanding WASH initiatives. Collaboration with these entities allows private-sector organisations to leverage expertise, assets and networks to enhance programme delivery. Through shared best practices, innovative approaches, and financial support, partnerships can enhance the effectiveness of WASH interventions. Coordinated efforts will ensure that WASH challenges are addressed comprehensively, leading to sustainable and impactful solutions.

To address emerging challenges in the WASH sector, investment in research and innovation is important. Governments and the private sector should support multidisciplinary research and integrate contemporary knowledge into WASH strategies. Advancing corporate social responsibility initiatives can also drive private-sector participation in WASH, facilitating community investments and improved health outcomes.

Community involvement, policy integration, behavioural change campaigns and the use of technology in monitoring and service delivery can also significantly enhance the effectiveness and sustainability of WASH programmes.

The writers work at the Sustainable Development Policy Institute (SDPI), Islamabad.