The Kerala government has announced a price ceiling for bottled water being sold across the state, after recognising it as an 'essential commodity'. The cap for bottled water which now has a retail price of Rs 20 per litre will be fixed at Rs 13.
Apart from the price regulation, the government has decided to make BIS water quality standards mandatory for all bottled water brands to weed out illegal manufacturers.
The decision to fix a price cap was taken during an audit on bottled drinking water manufacturers. In 2018, at a meeting convened between the state government and these manufacturers, it was decided to fix the price ceiling at Rs 12 per litre. However, this decision could not be implemented as it was opposed by a few players.
In 2020, the price ceiling of Rs 13 per litre was announced after Chief Minister Pinarayi Vijayan signed the Food Department Proposal.
Speaking to the media, Food Minister P Thilothaman had said that including bottled drinking water in the list of essential commodities allowed the state to fix the price cap on these brands.
“We have added it under the list of essential articles. This means that no private bottled drinking water manufacturers can sell their product at more than the fixed cap. This will remain uniform across the state,” P Thilothaman told TNM.
According to the Food Minister, the cap was fixed to ensure unchecked price rice of bottled water and to ensure customers are not fleeced. Although some manufacturers demanded that the price cap be fixed at Rs 15, the minister said it was fixed at Rs 13 as it was clear that the manufacturers could afford to sell at a much lesser minimum retail price. He added that the actual cost of producing a one litre bottle of water was Rs 6 and another Rs 2 was incurred towards distribution.
The Kerala Essential Articles Control Act, 1986 (13 of 1986) defines the term ‘essential article’ as any “any article, not being an essential commodity as defined in the Essential Commodities Act, 1955 (Central Act 10 of 1955), which may be declared by the Government by notified order to be an essential article. The act allows the government to check unbridled price rice of commodities and ensure free flow and equitable distribution of essential commodities.
According to reports, Kerala has around 300 brands of bottled drinking water. The Kerala Bottled Water Manufacturers’ Association, which has about 100 members, welcomed the state government's move. However, it is likely that disgruntled manufacturers will approach court.
Apart from private bottled water companies, the Kerala government sells drinking water at Rs 10, through a subsidiary of the Kerala Water Authority.