Case Study Developing Private Sector Supply Chains Water and to Deliver Rural Water Technology Sanitation Afridev Handpumps Program An international partnership to help in Pakistan the poor gain sustained access to improved Private demand emerges for water supply and sanitation services an affordable and reliable pump In the rural water supply and sanitation sector, goods and services (technology, training, repair services, financial and technical services, and facility management) are supplied to customers through a supply chain from manufacturers, importers, and service providers through a network of distributors. Payment flows in the opposite direction. BASIC SUPPLY CHAIN CUSTOMERS (COMMUNITIES,INDIVIDUALS) Goods and Services (Handpumps, Payment spare parts, repairs, credits) DISTRIBUTORS (RETAILERS,WHOLESALERS) Payment Goods and Services SUPPLIERS (MANUFACTURERS, SERVICE PROVIDERS) The Supply Chains Initiative is a global initiative led by the Water and Summary Sanitation Program. Collaborating partners include government departments, NGOs,and bilateral and Ten years ago, the Afridev handpump was relatively unknown outside of Africa. Today multilateral agencies. The aim of this it is manufactured in three out of the four provinces of Pakistan and more than 80,000 initiative is to develop practical tools that enable and encourage the private locally manufactured Afridev handpumps have been installed in the region. This case sector to provide goods and services study examines how this transformation occurred, and the effectiveness of the current related to rural water supply and sanitation. The initiative's first phase supply chain for Afridev handpumps and spare parts in Pakistan. In particular, it focuses will focus on increasing the on the increasing importance of the private sector in a market that has been dominated understanding of the dynamics of the private sector supply chains for by External Support Agencies (ESAs) and the local government. handpumps, spare parts, and sanitation equipment. 2 Background been drastically reduced. As a result, dealing in Afridevs, or their spare parts, many parts of Afghanistan have seen has been greater still. a return to non-mechanized water Afridev handpumps were supply systems. Afridev originally introduced to Thus, despite the troubled economic Pakistan in the late 1980s by ESAs and political environment in the region, Handpumps organizing relief operations for the there is a significant demand for reli- influx of Afghan refugees to the North in Pakistan able and affordable handpumps, and West Frontier Province (NWFP). The the popularity of Afridev handpumps Afridev was selected following field has grown. Since 1990, the number of The introduction of Afridev trials of a number of handpumps, and local manufacturers producing Afridev handpumps into Pakistan it quickly became the standard com- handpumps has increased threefold, was the result of considerable collabo- munity handpump used in the region. and the rise in the number of traders ration between federal and provincial More than 10 years after the intro- duction of the Afridev handpump, the conditions in NWFP and Afghanistan have not improved. Recent political upheavals in Pakistan have weakened the economy, and rural infrastructure remains basic. Although paved roads connect most towns, and rural electri- fication is widespread, more than 40 per cent of the rural population does not have access to safe water. Rural communities in Pakistan gen- erally prefer mechanized water supply schemes, but the local government does not have enough funds to pro- vide schemes, or even to operate and maintain existing schemes. There are also major problems with the quality and availability of the electricity sup- AFRIDEV HANDPUMP ply, and tariffs are rising rapidly. Clearly, the reliability and sustainability The Afridev is a robust and reliable handpump suitable for lifting water of rural water supply systems that from a depth of 10 to 45 meters. User-friendly features, such as inexpensive, depend on electric pumps is question- lightweight components, and a design that allows easy removal of pump able under these circumstances. rods and below-ground components, give the Afridev a clear advantage over In Afghanistan, the situation is worse alternative products. The concept and design of the Afridev handpump was a still. The fighting continues, as does the co-operative effort; the Swiss Center for Development Cooperation in Tech- flow of Afghan refugees to Pakistan, nology and Management (SKAT) has made the standard specifications and and many of the refugee settlements manuals for the manufacture and installation of the Afridev available to the are now effectively permanent. Exten- public. sive damage to the rural economy and Two types of Afridev pumps are produced in Pakistan: the Indus pump, which infrastructure has eliminated public is manufactured according to the standard SKAT specification; and a smaller services in many areas, and people's indigenously developed Afridev variant, known locally as the Kabul pump. capacity to pay for private services has 2 governments, External Support Agen- an Afghan political party, with the edly affected by the plummeting cies (ESAs), NGOs, and local indu- intent to increase the availability of low- foreign exchange value of the stry, over a period of several years. The cost handpumps in Afghanistan; the Pakistani rupee. most significant intervention was a two Lahore-based manufacturers, Pro- At the outset, the factories concen- large-scale program led by UNICEF. gressive Steel Industries (PSI) and Shani trated on the manufacture and galva- The UNICEF approach was to use Engineering, were existing steel fabri- nizing of the metal pump components their program to generate a `critical cation companies whose skills and (body, handle, fulcrum, rod hanger mass' of Afridev handpumps that spare capacity enabled them to pins, and pump rods) and left the fab- would encourage political support, and respond to demand from the ESAs; and rication of the plastic and rubber com- produce enough product knowledge the final factory, Kawsar Engineering ponents (plunger, foot valve, bushes, and process skills to sustain local Works, was set up by former employ- seals, bobbins) to specialist manufac- manufacture. In the initial phase ees of the DACAAR handpump factory turers in Lahore. In the last few years, UNICEF assisted in setting up two fac- who already had experience in the however, the combination of a desire tories. The Danish Committee for Aid manufacture of Afridev handpumps. to reduce production costs, and to Afghan Refugees (DACAAR) estab- However, they were all aware of the increased confidence in their fabrica- lished the first factory in Swabi, about large handpump programs under way tion skills, has led several of the manu- a one-and-a-half-hour drive east of in Pakistan and Afghanistan, and of facturers to start producing their own Peshawar. A company called Engineer- the high price of the Afridev handpump, rubber and plastic parts, and three of ing Concern (EC), in Karachi in south- and it was the potential value of the factories now make the majority of ern Pakistan, started the second. These orders for these handpump programs their Afridev components in-house. factories began by using Afridev that was their primary motivation for During the period 1991-99, infla- handpumps from Kenya as templates starting production. tion in Pakistan averaged over 10 per for their production and, despite some cent, so the fact that the Afridev initial difficulties, they were soon Costs handpump now sells for 20 per cent producing several thousand Afridevs less than it did nine years ago illus- a year. trates the increases in efficiency that Production increased in the early Government departments competition has produced. However, 1990swhentheLocalGovernment,Elec- and ESAs have both actively there is some concern that this price tions & Rural Development Department encouraged competition between the competition is starting to cause a `race (LGE & RDD) adopted the Afridev as its manufacturers. Promising manufactur- to the bottom'. Some ESA contracts are standard community handpump. At the ers have been awarded small orders now being awarded largely on price, same time relief activities inAfghanistan to stimulate their growth, and the large and manufacturers are being tempted expanded,butpricesremainedrelatively contracts have been let through com- to use inferior materials and cheaper stagnant. UNICEF and DACAAR realized petitive `open bidding' procedures. This production processes to lower their that this was largely due to the duopoly strategy has been effective, and the costs. PSI (Lahore) is currently under- that the two existing manufacturers had average cost of an Indus (Afridev) selling their competitors by 10 to 15 on the supply of Afridev handpumps in handpump, not including pipework and Pakistan, so they set out to encourage installation, is now only US$ 130 (see Table 1 othermanufacturerstobeginproduction. Table 1). Interestingly, whilst Table 1 Cost of Indus pump in Pakistan They were successful. Four more Afridev shows that the dollar price has dropped Year Rs OER US$ handpump factories, two in Peshawar dramatically (more than halving since 1987 - - 700 andtwoinLahore,arenowinproduction, 1991), the rupee price has dropped by and prices have dropped considerably. only 20 per cent. It appears that, 1991 8,000 25 320 There were a number of reasons for because the majority of the materials 2000 6,500 50 130 the emergence of the new factories: are bought and processed locally, the OER = Official Exchange Rate Peshawar Engineering was started by price in Pakistan has not been mark- 3 per cent, and this is putting consider- and manufacturers habitually under- from ESAs or local government (see able pressure on the other manu- estimate their sales and production fig- Table 3), there is considerable concern facturers to relax their quality standards. ures in order to conceal the true extent about how sustainable the Afridev sup- of this evasion. Figures compiled dur- ply chain really is. As a result of the Market Size ing this study (see Table 2) suggest that fierce competition, two of the manu- at least 83,000 Afridev handpumps facturers (Engineering Concern and have been produced in Pakistan, Shani Engineering) have reduced their An accurate estimate of including those exported to Afghani- production and are starting to concen- the total number of Afridev stan, and that recent sales have aver- trate on other manufacturing activities. pumps produced in Pakistan is not aged about 12,000 units per year. Current policies and priorities in the readily available. More than 50 per At present, five Afridev manufactur- water and sanitation sector are also cent of the pumps produced in ers supply the entire Pakistan and changing to recognize the strong link Pakistan are exported duty-free to Afghanistan markets, which have a between improvements in sanitation Afghanistan through relief agencies combined annual value conservatively and health benefits; expenditure on and international NGOs, but the estimated at Rs 80 million (US$ 1.6 mil- handpumps in Pakistan is expected to remainder of the production is sold to lion). The trade in Afridev handpumps decline as low-cost sanitation becomes domestic customers and is therefore and parts is currently large enough to the main focus of many local govern- liable for excise duty (currently 15 per sustain the supply chain but, with about ment and ESA programs. cent). However, this tax is rarely paid, 90 per cent of annual orders coming There are at least 10 traders in NWFP that deal in Afridev handpumps and parts on a regular basis1, a further three traders in Baluchistan, and another seven traders operating in Afghanistan. However, some of these traders deal mainly in spare parts, and their estimates confirm that private sales in Pakistan and Afghanistan prob- ably did not exceed 1,000 pumps last year (nine per cent of annual pro- duction). Furthermore, discussions in southern NWFP suggest that most `private sales' in Pakistan are actu- ally made to local NGOs, as very few private individuals or groups are will- Table 2: Manufacturers' estimates of Afridev production ing to purchase Afridev handpumps Manufacturer 1999 Production Total Production at the full price. DACAAR 3,300 35,000 Despite these observations, the Engineering Concern 300 15,000 potential demand for Afridev hand- pumps and parts is high, particularly Peshawar Engineering 2,900 15,000 in Afghanistan. In 1999, DACAAR con- PSI 2,100 10,000 ducted a survey that concluded that Kawsar Engineering 2,500 6,000 84,000 more deepwell handpumps are required in the rural areas of Afghani- Shani Engineering - 2,000 stan, and UNDP has apparently sug- Total 11,100 83,000 gested that as many as 300,000 hand- pumps may be needed. The Afridev 1Stores in Peshawar, Lachi (2), Bannu (2), Karak, Miran Shah, Tank, Parachinar, and Patajan. 4 nately, the findings of this study suggest that most people in these Table 3: DACAAR handpump factory sales, 1999 categories are unlikely to choose an Buyers Indus Kabul Total Nr. % Afridev handpump. ESAs and NGOs 1,757 1,195 2,952 86 The cost of installing a cheap elec- Lijnatul Dawat al Islamia 19 261 280 8 tric borehole pump is similar to the cost of an Afridev installation, and wealthier Private sales 145 40 185 5 households, who can afford the elec- Total 1, 921 1,496 3,417 100 tricity bills, often prefer a mechanized system, which has the added benefit of allowing them to irrigate any nearby Table 4: DACAAR private sales in Afghanistan gardens or orchards. Cultural factors restrict the number Item Jan-Mar 2000 of households that will group together Afridev parts (pieces) 10,872 to purchase a pump. The social and Afridev handpumps (set) 139 religious customs of the region include strict `purdah' for women, which Handpump installations 101 involves them being hidden from non- family members. Thus, most families handpumps already installed also cre- the provision of subsidies were easily live within small private compounds ate demand. DACAAR has recently the most significant determinants of shared with a few related households, started recording the private sales handpump choice, and that mainte- and there is a strong preference (from made by their handpump technicians nance cost and spare parts availability both men and women) for water points in Afghanistan, and the figures (see both ranked very low. Clearly, informa- to be situated within these compounds. Table 4) suggest that this segment of tion is a factor in choosing a hand- The Afridev is expensive for these small the market alone is consuming more pump, but it remains true that most groups, and they tend to prefer cheaper than 40,000 spare parts a year. low-income groups prefer familiar `local' or hybrid pumps. There is clearly a demand for Afridev products with a low initial cost, and that Local handpumps are available in handpumps and parts in the region. This changing this behavior is often a long numerous configurations, but the demand varies geographically, being process. A `small steps' approach is pump set generally costs about higher in Afghanistan than in Pakistan, needed, and a range of low-cost Rs 2,500 (US$ 50), approximately one- and depends both on the number of handpumps may be necessary to meet third the cost of an Afridev. These Afridev handpumps already installed, the demand for incremental levels of handpumps are quite appropriate and and on the water resources available service during this transition. cost-effective for lifting water from less (demand is higher in non-irrigated Installing an Afridev handpump is than 30 meters (100 feet), but beyond areaswithdeepgroundwater). The criti- not cheap. The additional costs of the this depth the pump action becomes cal question, though, is how many of pipework, drilling, and construction heavy and maintenance requirements these people are prepared to pay for raise the average cost of a full Afridev increase rapidly. Technicians in south- non-subsidized Afridev handpumps. handpump installation to about ern NWFP recognize that the Afridev is Rs 25,000, which is the equivalent of a better investment than local hand- Affordability the average yearly household income pumps at depth, and there were regu- in Pakistan (about US$ 500). Evidently, lar reports of Afridevs operating satis- prospective customers are likely to be factorily at depths greater than A study on handpump use wealthier households, or groups of 45 meters (150 feet). in Bangladesh (MIDAS, households prepared to share the pur- A recent innovation has been the 1997) found that low capital cost and chase and installation costs. Unfortu- introduction of hybrid Afridev pumps. 5 These hybrids generally combine ber u-seals for Rs 10 (US$ 0.20), and below-ground Afridev parts with a the highest price asked for a plastic CASE STUDY local pump head and handle, and are plunger was Rs 120 (US$ 2.40). These about half the price of a standard traders noted that, while their prices In 1995, Abdul Rehman (Noor Afridev handpump. One trader were largely determined by competi- Electric Store, Karak NWFP) was reported that it was local people who tion, their profit on a particular prod- selling small quantities of Afridev were buying the hybrids, whereas the uct was largely dependent on the parts from his hardware store on Afridevs were being bought by local strength of their relationship with the behalf of local LGE & RDD staff. NGOs, and that he sold two hybrid manufacturer, that is, whether they are He says that he had been inter- handpumps for every three Afridevs. able to get credit, or obtain discounts ested in stocking the parts for The development of more affordable by making bulk purchases. some time, but had been unable hybrid handpumps confirms that to find their source until he was Availability people perceive the Afridev, and its asked to carry out some work for pump head in particular, to be over a road contractor in the Swabi designed, and that there is a demand area. While in the area, he for cheaper variants. It also shows that A 1993 survey by UNICEF discovered the DACAAR hand- there is an increasing awareness of its found that Afridev hand- pump factory, and he was soon technical advantages (minimal main- pumps and parts were not readily avail- buying Afridev parts directly from tenance requirements and low-cost able in southern NWFP, and that there their factory. spare parts). were significant regional variations in He has now been stocking Government and donor-funded demand and availability. This was con- Afridev parts for four years, and water supply programs also affect per- firmed by hardware dealers in south- he began stocking complete ceptions of affordability. Thousands of ern NWFP, who noted that there has Afridev handpumps two years ago. households have been provided with been a substantial demand for Afridev He buys from three different free or subsidized Afridev handpumps parts for the last five years, but that, manufacturers (PSI, DACAAR and through these programs, and favored until a few years ago, the only source Kawsar) and, in March 2000 alone, communities have received mecha- of Afridev pumps or parts was the LGE he sold 19 Indus handpumps, 12 nized water supply schemes. Not sur- & RDD because most of the traders did `hybrid' Afridev handpumps and prisingly, many households are not will- not know where the parts were manu- more than 300 Afridev parts from ing to pay for facilities that others have factured, or how to obtain them. How- his Karak store (he has also started received free, even if they are aware ever, the situation changed with the another five small hardware stores that many of these facilities no longer curtailment of the local government in Karak district). work. Expectations regarding future handpump programs and the exhaus- subsidies have reduced willingness to tion of the stock of parts supplied by pay for privately-installed Afridev UNICEF, and there are now more than More traders are becoming involved, handpumps. 20 traders dealing in locally produced and many of the established traders Despite the relative expense of the Afridev handpumps and parts. now enjoy credit arrangements with Afridev handpump, most Afridev spare Fierce competition for ESA and gov- several manufacturers. parts are cheap. There is an under- ernment contracts, and fears of what The evidence of this study suggests standable trend for prices to rise as may happen if these orders decline, has that supply choices are still determined the distance from the manufacturer led several of the pump manufacturers largely by price and availability. Des- increases, but even in the remoter to explore more fully the potential of pite being based in Lahore, PSI has areas of NWFP, the prices of the most sales to private customers. As a result, attracted a lot of business from trad- regularly consumed parts (u-seals and they are beginning to invest additional ers in NWFP because of its low prices plungers) were very low. In Bannu, time and effort in marketing Afridevs, and, provided it is cheap, most pri- traders were selling good quality rub- and in developing their supply chains. vate customers appear to buy what- 6 the LGE & RDD area technicians, who FACTORS AFFECTING AFRIDEV SUPPLY CHAINS make the most of this monopoly by charging high prices for their services. Enabling factors: Even where demand is high, such as in southern NWFP, there are very few q road connections are generally good and the `Bilti' system (a cheap and effective private sector trucking and delivery system) means manufactur- ers can deliver material easily technicians able to carry out Afridev q communications are good (all the traders visited had telephones and most installation or repair services. Unfor- used them to place orders) tunately, the lack of competition q unreliable electricity supplies in Pakistan and Afghanistan (encouraging people to use handpumps) removes the incentive for these tech- nicians to provide an efficient and Disabling factors: affordable service, and there is evi- q political uncertainty (constraining investment by the private sector) dence that some technicians have q government drive to improve recovery of duties and taxes (may increase pump costs) deliberately installed inferior Afridev q low-cost of mechanized water supply infrastructure (reducing demand parts to ensure that their services are for handpumps) regularly required. q lack of access to finance or credit by customers q lack of effective repair services (reducing reliability) Reliability q monopoly of cylinder liner supply by government factory (affecting price and reliability) One of the main difficul- ties faced during transitions from donor-led handpump provision to sustainable private-sector provision is with the poor service provided by inex- perienced private drillers and contrac- tors. The incorrect installation of Afridev handpumps by inexpert or predatory contractors can cause severe reliabil- ity problems and pump failures. The alignment of the handpump and the quality of the pump components become particularly important when lifting water from more than 30 meters (100 feet), as the forces involved at ever is available in their local store. the supply chain is becoming increas- these depths are very high, and the However, the expanding trade in ingly effective. strength and durability of the compo- Afridev handpumps and parts is start- The availability of reliable repair ser- nents are severely tested. ing to bring about a growth in aware- vices for Afridev handpumps is a prob- Low quality parts fail frequently ness of quality and branding among lem area. The Afridev has a low main- under duress, but most of these parts customers and traders, and this has tenance requirement, especially when (plungers, u-seals, pump rods) are persuaded a few stores to try stocking lifting water from less than 30 meters relatively cheap and easy to replace, handpumps and parts from several (100 feet), which limits demand for and these failures can sometimes gen- different suppliers, with prices varying repairs or routine maintenance, and erate a demand for better quality spare according to the product quality. has constrained the development of parts. Generally, the quality of Afridev This improvement in availability is supply chains for these services. Many spare parts in Pakistan is highly vari- demand-responsive, and suggests that Afridev users are solely dependent on able, and many of the traders visited 7 stocked cheap rubber and plastic parts government-run facility. However, PSI increases in the number of traders that were copied from the genuine have recently started importing brass involved in buying and selling Afridev parts by manufacturers in Lahore. In cylinder liners from Dubai on an pumps and parts demonstrate that the an attempt to differentiate their prod- experimental basis, and DACAAR are supply chain is expanding, and that ucts from these lower quality ones, sev- currently exploring ways of produc- availability is improving. Interestingly, eral of the Afridev manufacturers have ing their own cylinder liners; it is most of this growth has been in begun incorporating logos into the possible that these ventures will response to local demand, thus the moulds of their plastic and rubber develop alternative supplies of high stores stocking Afridev handpumps and parts, and PSI has even started using a quality cylinder liners. parts are not to be found in cities, but distinctive red rubber rather than the in rural centers, and most of their busi- usual black material. Effectiveness of ness is not with government or ESAs, Problems with expensive compo- but with local NGOs and private cus- nents, such as the pump cylinder, the Afridev tomers. Despite this expansion, there which can cost as much as Rs 1,800 Supply Chain is still a shortage of reliable repair ser- (US$ 36), are more serious. Oversized vices in many areas. Afridev pump cylinders make the footvalve leak, thus reducing pumping Is there a real and Is the Afridev supply chain efficiency, while undersized cylinders sustainable demand for meeting the demand cause the plunger to stick, requiring Afridev handpumps effectively? greater force to be used in pumping, in the region? Unfortunately, it appears that the which leads to frequent breakages. It At the moment, the main demand rise in private sector participation is appears that pumps with cylinder for Afridev handpumps is from hand- being undermined by supply chain problems are often abandoned, either pump programs run by local govern- weaknesses. Reliability problems, because of the cost of replacement, ment, ESAs or NGOs, and there are often caused by bad installations or or because the local technician has indications that this demand is reduc- low-quality pump components, are been unable to diagnose the source ing. Private sales are currently low, affecting private sales. Affordability of the problems. but they have grown rapidly in the is also a problem. The heavily subsi- The cylinder liners used in Pakistan last few years, and there is evidence dized handpump programs have not are made by a government factory in of significant potential demand in proved to be a sustainable solution, Wah (near Islamabad), which is the Afghanistan, and in certain areas of and have clearly inhibited the private only facility in the region able to pro- Pakistan (for example, where the sector. Therefore, reducing the cost of duce brass cylinders with the requisite water table is deep and the electric- the Afridev handpump, without com- polished internal finish. The diameter ity supply is unreliable). promising its quality, remains the of these liners is supposed to be care- major challenge faced by the Afridev fully checked prior to supply, but there Is the Afridev supply chain supply chain in Pakistan. is evidence that a large number of able to meet this demand? Despite these difficulties, there are these liners, which had been rejected The manufacturers are operating at some indications that the supply chain as `out of tolerance' following quality below full production capacity, which is becoming more effective: checks by one of the Afridev manufac- suggests that they are meeting awareness of availability and qual- turers, have subsequently been sold on demand. The customer interviews con- ity is improving among both suppliers to other manufacturers and incorpo- ducted during this study indicate that and customers; rated into their Afridev handpumps. the limited demand for unsubsidized manufacturers are starting to intro- At present, the supply of the brass Afridevs is being met, but that the duce branding and to actively promote cylinder liner is a monopoly, and there significant demand for subsidized their products; is little scope for reducing costs or Afridev handpumps, particularly in credit is being extended to traders by improving the quality control at this Afghanistan, is not. However, recent manufacturers (usually 15 to 20 days); 8 traders are increasing the size and demand for many years yet. Therefore, from a significant proportion of the content of their Afridev product it is vital that efforts are made to potential market. There are valid rea- range; and improve the range of products that the sons for a `standardization approach', hybrid Afridev handpumps combine Afridev supply chain provides, and that especially during the introduction of a the Afridev's technical advantages with the ESAs (who invested so much time new handpump, but insistence on rigid increased affordability. and money to develop the supply international specifications constrains chains), formulate exit strategies that innovative local enhancements and, in Finally, then, is the Afridev ensure subsequent private sector provi- Pakistan, has resulted in the Afridev supply chain sustainable? sion is both affordable and sustainable. being considered an expensive foreign More than 90 per cent of the exist- product, whose only real customers are ing demand is from the local govern- Implications aid agencies. An international NGO ment and ESAs, and most of the working in Bangladesh, International remainder is from local NGOs. This and New Development Enterprises (IDE), has suggests that the public has not yet fully Approaches demonstrated that local manufacturers accepted the Afridev handpump as an can make more affordable versions of appropriate or affordable product, and standardized handpumps, such as the that the industry is still largely depen- Diversify product ranges Tara and the UNICEF Number 6, by dent on external support. Affordability to reduce dependence on reducing the diameter of the below- is the key to the future success of the ESA orders ground components and by incorpo- Afridev handpump, and thus to the There is a huge demand for low-cost rating local materials into the pumps, sustainability of its supply chain, but handpumps in the region, but local and these low-cost pumps are proving even intense competition between contexts vary considerably, and Afridev very popular. Hybrid Afridev hand- manufacturers has not been able to handpumps are not always an appro- pumps, and cheap `local' pumps, reduce prices by much. However, there priate option. Most low-income groups offer incremental levels of service that has been a growth in private sales consider Afridev handpumps too are attractive to low-income groups, following the scaling down of the sub- expensive, and there are insufficient and the Afridev manufacturers should sidized handpump programs, and the funds for universal subsidies, therefore be encouraged to use their compara- long-term development requirements a `single product' approach effectively tive advantage (experience and of Afghanistan look likely to generate excludes the Afridev manufacturers resources) to supply this market. Assist Afridev manufacturers to create and support networks of handpump technicians, including community-based ones Existing institutional arrangements have resulted in the monopoly of installation and repair services by ineffective `area' handpump techni- cians. Manufacturers should be encouraged to break these monopo- lies and support private installation and repair services. They have numer- ous incentives: they can increase their market share by providing credit and discounts to traders and technicians 9 that use their products; they can mar- ity of instituting an appropriate and ket their brand through these supply sustainable certification system. chains, thus improving private sales; Water and Sanitation Program and, finally, they have the technical Microfinance for experience and resources to make handpump purchases 1818 H Street NW installation and repair services more Microfinance schemes in NWFP Washington DC 20433 USA efficient, thus improving the reliability have reportedly achieved 97 per cent and reputation of their products, and recovery on loans for small agricul- Phone: +1 (202) 4739785 generating higher sales. ESAs could tural projects. The provision of simi- Fax: +1 (202) 5223313, 5223228 assist this process, and prevent the lar `social collateral' loans to low- E-mail: info@wsp.org costs being passed on to the customer, income groups may improve the Web site: http://www.wsp.org by providing subsidized training pro- affordability of Afridevs, and thus grams to private manufacturers, trad- increase the potential market. ers, technicians and community mem- bers. The Afridev is designed to be a References Water and Sanitation Program-South Asia `VLOM' (Village Level Operation and 55 Lodi Estate Maintenance) pump, and the skills New Delhi 110 003, India required to carry out repairs are easily MIDAS (1997) `Draft report on Phone: (91-11) 4690488-89 Fax: (91-11) 4628250 transferred. Even very informal techni- study of handpumps in low water cians, with support, could provide effi- table areas: technology options, mar- 20-A Shahrah-e-Jamuriat G-5/1 Islamabad, Pakistan cient services to groups of households keting and financial arrangements', Phone: (92-51) 2279641-46 at low-cost. Dhaka: SDC Fax: (92-51) 2826362 Mudgal, A K (1997) `Indian Introduce quality handpump revolution: challenge Other publications in this series: 1. The Treadle Pump: An NGO Introduces assurance certification and change', HTN working paper a Low-cost Irrigation Pump to for Afridev handpumps WP 01/97 Bangladesh SKAT (1991) `Proceedings of the At present, most of the ESAs hire 3. Arsenic Mitigation in West Bengal handpump meeting in Islamabad: June quality control specialists to inspect the and Bangladesh 1991', St. Gallen: SKAT 4. The Growth of Private Sector Afridev handpumps that they purchase. SRSC (2000) `Monthly progress re- Participation in Rural Water Supply Private customers cannot afford this and Sanitation in Bangladesh ports, SRSC Kohat region', unpublished luxury, and usually do not have suffi- The Dawn (2000) `Dawn Eco- cient technical expertise to detect any nomic and Business Review, May flaws; hence they are often sold the 1-7, 2000: Need for a new eco- handpumps rejected by the ESAs. Even nomic paradigm', Lahore: Jang specialists find it difficult to detect the Newspapers use of inferior materials, but it is pos- UNICEF (1993) `Assessment of sible to assure quality by having a performance and usage of December 2000 respected institution provide some form Afridev handpumps in NWFP', of certification, or marking, to show unpublished The Water and Sanitation Program is that the component, or material used, Robinson, Andy (2000) Water and an international partnership to help the meets relevant national standards. The poor gain sustained access to improved Sanitation Program-South Asia (1999) water supply and sanitation services. Afridev manufacturers are already pro- `Demand or dependency? Afridev The Program's funding partners are the viding a form of quality assurance by handpumps in Pakistan', unpublished Governments of Australia, Belgium, putting permanent brands on their World Bank (2000) `Country Canada, Denmark, Germany, Italy, products, and ESAs should assist them brief: Pakistan', Web site: Japan, Luxembourg, the Netherlands, Norway, Sweden, Switzerland, and the by investigating the cost and practical- www.worldbank.org United Kingdom; the United Nations Development Programme, and Prepared by Andy Robinson. The World Bank. We thank Simon Trace of WaterAid UK for his suggestions and comments. For more information, contact Clarissa Brocklehurst, Supply Chains Series Co-ordinator for South Asia, at cbrocklehurst@worldbank.org Created by Write Media E-mail: writemedia@vsnl.com Printed at PS Press Services Pvt Ltd