October 18, 2023
A new investment in clean drinking water in rural India marks the inception of Incofin’s newly established Water Access Acceleration Fund (W2AF). Norfund’s 5 million EUR investment in the fund will contribute to bringing clean drinking water to the regions most affected by the global water crisis.
The W2AF fund was launched in March 2023 with total commitments of EUR 36 million, including Norfund’s contribution of 5 million EUR. The aim of the fund is to bring clean drinking water to 30 million people in the water-scarce areas in Africa and Asia by 2030, and they have plans to double this amount in the future.
The investment of EUR 7.5 million in Rite Water Solutions will improve water solutions in rural regions in India by providing comprehensive, cost effective and sustainable solutions for safe drinking water where the water sources is contaminated. Rite Water has deployed 2,500 purification units and impacted more than 2 million peoples in 12 states of India, contributing to SDG 6 of Sustainable Development Goals.
Water scarcity is, according to the UN, projected to increase with the rise of global temperatures as a result of climate change. Unless the progress increases dramatically, billions of people will lack access to clean water in 2030.
The fund is the first of its kind, with a combination of commercial private capital, development finance institutions and aid money to relieve some of the risk.
“The goal is that the new fund, by taking higher risks, can show that the business models can deliver, and thus also show the way for other investors in the water sector, so that even more people can have access to affordable and clean water.”Delphine Gilbert, Investment Manager in Norfund
Today, 2 billion people lack access to clean drinking water. Climate change, population growth, and urbanization mean massive investments are needed to reach UN Sustainable Development Goal 6 of access to safe water, sanitation, and hygiene, but it has been challenging to mobilize capital to the sector.
According to the World Bank, developing countries lose around 260 billion USD annually due to poor water supply. It’s estimated that each dollar invested in clean water yields a four dollar reduction in health costs. By pooling resources and expertise and catalyze additional private capital, there is hope to improve the water access for millions of people in Africa and Asia, fostering better health and economic development.