India Wastewater Investment Opportunities
Do NOT Read This if You're Easily Offended...
I'm incredibly fortunate!
I realize it may not sound like a big deal... but this morning, I didn't have to venture outside to use the bathroom.
Nope. To get to the bathroom, all I had to do was walk about 15 feet until I got to our very clean and cozy bathroom, where you'll not only find a shower and a sink, but a flushable toilet as well.
It's nothing out of the ordinary for us these days. In fact, walk into any Home Depot and you'll find dozens of various toilets that you can easily install yourself. From low-flow to standard industrial to dual-flush, you can bring home a new toilet from the store and attach it directly to an indoor plumbing system that ensures you never have to think twice about modern sanitation and waste water disposal.
We rarely think about it, but the truth is if you have an indoor toilet, you are very, very fortunate.
My grandfather grew up on a farm, and he used to tell me stories about running out to the outhouse during the winter months, and how he would often have to battle with all kinds of pests and rodents during the summer.
Of course, that's nothing compared to what I'm about to share with you today...
Not for the Squeamish
I want you to take a look at a picture.
But before you do, please understand that if you're easily offended, you should avert your eyes.
This is an image of a very common occurrence in many parts of the world.
This is called “open defecation.” And while I cringe at the thought of sharing an outhouse with snakes and mosquitoes during those hot, sticky Baltimore days in July, I can't even imagine growing up in an environment where even a simple outhouse is not an option.
As I said, this is a common occurrence in many parts of the world — particularly in India, where only 20% of the nation's sewage is actually treated.
No, I'm not sharing this with you to make you feel uncomfortable. Instead, I simply want to introduce you to a problem that is about to be rectified through an infrastructure investment opportunity that will not only help millions of people and save countless lives, but also allow you to make a few bucks along the way.
Crisis, Meet Opportunity
Today, across the globe, about 2.5 billion people — or roughly 40% of the global population — have no adequate toilet. Not even a bucket.
But this isn't about something that many of us would just look at with disgust. This is actually a life-or-death situation.
You see, there are about 50 communicable diseases that can travel in human feces. The boy in the picture above? Well, when he's done, he doesn't wash his hands, and his bare feet will serve as an excellent vehicle for all kinds of parasitic cysts, eggs, bacteria, and viruses that will ultimately end up in his home environment, contaminating his food and fresh drinking water supplies.
The result for most is diarrhea, a temporary affliction that proves to be little more than an inconvenience for most folks in this part of the world. But in many parts of the world, it's a killer: 4,000 children every day die from diarrhea. It's actually the second biggest killer of children worldwide.
But not here. No, after we started installing flush toilets and wastewater treatment systems, child mortality in the United States dropped more than it had ever dropped in history. The flush toilet has actually been called the best medical advancement of the last 300 years by the leaders of the British Medical Journal. This is compared to pills, anesthesia, and surgery.
So it's no wonder with so many developing nations aggressively growing their economies — but lacking basic, modern sanitation — that new investment is now being funneled into modern wastewater treatment projects.
In fact, just last week, we learned that the government of India has set aside $20 billion exclusively for sewage treatment, irrigation, and recycling. Of course, this pales in comparison to what the G20 is ponying up...
An Economic Imperative
A few years ago the G-20 created the High Level Panel on Infrastructure (HLP). This group was charged with the task of facilitating infrastructure investment around the world. While it's true the motivation offered a very ethical response to a burgeoning crisis, it also resulted in a major investment designed to facilitate economic growth in developing nations.
Here's what the G-20 announced back in 2010:
Investment in infrastructure is crucial as a tool for countries’ economic and development policy, since it unleashes greater growth in the short term and raises productivity levels and competitiveness in the medium term.
Adequate infrastructure supports the development of economic activity in an efficient and safe manner, improving the welfare of the population, triggering further growth, and creating jobs.
That is why infrastructure has been established by Mexico and other G-20 countries as a priority for economic policy.
And last year we learned that on the heels of the approval of the G-20's HLP initiative, about $1 trillion was being set aside for infrastructure development in India. This, by the way, is only about 2% of what the HLP is expected to invest going forward.
So clearly, there's some opportunity here...
Veolia (NYSE: VE) and GE (NYSE: GE) seem to have a lot skin in this game, as well as a lot of influence in the G-20. I expect both to be very well-fed from future wastewater infrastructure deals in India.
I would also urge you to start paying close attention to wastewater treatment announcements coming out of India, Pakistan, and China. This will prove to be a profitable trend throughout the rest of this decade, and I want to make sure you're able to profit from it along the way.
We'll certainly have more on this going forward.
To a new way of life and a new generation of wealth...
@JeffSiegel on Twitter
Jeff is the managing editor of Energy and Capital and contributing analyst for the Energy Investor, an independent investment research service focusing primarily on stocks in the oil & gas, modern energy and infrastructure markets. He has been a featured guest on Fox, CNBC, and Bloomberg Asia, and is the author of the best-selling book, Investing in Renewable Energy: Making Money on Green Chip Stocks. For more on Jeff, go to his editor''s page.