Poor sanitation was estimated by UNICEF to cost India ₹12.2 trillion ($189 billion), or 7.9% of GDP, in 2015. In 2014, there were 111 million rural and about 10 million urban households in India still without a sanitary toilet, with 564 million still practising open defecation: representing 60% of open defecation globally.
If open defecation were eliminated, these losses were estimated to drop to ₹4.1 trillion ($64 billion), representing savings of ₹8.1 trillion ($126 billion).
In response, the Swachh Bharat (Clean India) Mission (SBM) is a government initiative to end open defecation in India. Since its launch, it has not only made India cleaner but also put India in a good position for trade, foreign investment, and tourism, with knock-on impacts in female entrepreneurship and reputational benefits internationally.
At the European Bank for Reconstruction and Development (EBRD) Annual Meeting 2025 in London, Trade Finance Global (TFG) spoke to Nicolas Osbert, currently in Ukraine as the Water, Sanitation and Hygiene (WASH) Chief, on his involvement in UNICEF’s collaboration with the Indian government to get the SBM to where it is today.
Swachh Bharat Mission: History and background
Introduced in 2014 by Prime Minister Narendra Modi, the SBM aims to achieve its goals of sanitation in India through a combination of infrastructure development, subsidies to households in rural areas, public funding, educational programs, and community engagement. It strongly emphasises the link between sanitation, the economy, and the general welfare of the population. Understanding that sanitation is not only about constructing facilities, the SBM has also promoted behavioural shifts and community ownership.
As Osbert explained, sanitation is a huge public health problem; without it, many children suffer from dehydration and malnutrition caused by open defecation. There are estimated to be 221,000 diarrheal deaths per year among the under-five population due to poor sanitation and hygiene each year in rural India, giving an annual mortality risk of 2.54 per 1,000, but a World Bank analysis found a 47% reduction in diarrhoeal disease among children under four in villages with complete toilet coverage.
The Indian government has spent over $25 billion on the SBM so far, and agencies such as UNICEF are supporting the effort. But in rural areas in particular, changing entrenched attitudes in the public has been difficult. Even though more than 90 million toilets have been built, about 11% of the country’s population continues to defecate in the open.
Sanitary supply chains
The relevance of the SBM goes beyond public health—regarding international trade, the SBM has significant impact for activities in the food, pharmaceutical, and tourism industries. Sanitation and cleanliness play a key role in these segments, impacting everything from methods of production to how products are perceived by the consumer.
In food processing, for example, strict hygiene is required to avoid contamination and to assure consumers of safety. A pure supply chain not only enhances product quality, but it also creates consumer confidence, a critical factor in a fiercely competitive domestic and international market. The pharmaceutical industry, too, needs special hygienic measures to adhere to international standards. This is particularly critical for India, one of the world’s largest suppliers of generic drugs, which crossed $30 billion in exports for the first time in 2024, making it a significant positive contributor to the country’s growth story.
Finally, and fairly intuitively, travel and tourism are affected by sanitation. Hosting one of the largest numbers of UNESCO World Heritage Sites in the world, India needs to solve the cleanliness issue in order to continue to draw foreign visitors. The SBM has focused on improving the hygiene situation around these sites, which has helped make India a more desirable tourist destination. As Osbert pointed out, a well-kept village serves as a mark of pride for the nation and helps sustain local and foreign tourist activities that bring about much-needed economic benefits; tourism is expected to contribute over ₹22 trillion, or $256.17 billion, to the Indian economy this year.
Building toilets, building futures
The SBM not only promotes the development of other economic sectors, it has also become its own economic engine. The program has created some 200,000 full-time jobs, many through small and medium-sized enterprises (SMEs) in construction, according to Osbert. Such employment generation is vital for economic growth, supporting families, and fueling an entrepreneurial spirit, specifically in rural areas where economic activities are scarce.
The mission has also helped to empower women, who have been trained to become masons to build toilets for the SBM. In Jharkhand, a state in northern India which is now open-defecation free, trained women masons built more than 1.5 million toilets in one year. Not only has this provided a means of income for them, it has also shifted the typically patriarchal structure that has held them down for centuries.
The halo effect of hygeine
Since the SBM has enhanced the image of India amongst its global stakeholders, its positioning as a destination for investment will undeniably be strengthened. India has shown its seriousness to address pressing public health challenges by taking up the often-neglected issue of sanitation, thereby winning the confidence of global partners.
According to Osbert, India’s proactiveness has inspired other countries, including Nigeria and Ethiopia, to work on their own sanitation programs. Open defecation in sbu-Saharan Africa sees a 27% average prevalance (compared with 11% globally), while in Ethiopia this level was reported to be 35-40%. India has dispatched experts to help African countries developing their sanitation infrastructure; India in this way is emerging as a sanitation leader and a global player in delivering economic aid rather than merely receiving it.
Better hygiene practices have also led to India becoming more in line with international norms. The more the country develops its sanitation infrastructure, the more it becomes an attractive prospect for foreign investors seeking to establish a presence in a cleaner economy. The SBM’s strong focus on sanitation is consistent with global sustainability aspirations, attracting investments that address ecological concerns. In addition, adoption of advanced techniques and best practices, such as real-time monitoring and green solid waste processing, shows that India is serious about updating its approach to sanitation and about deploying technology across industries.
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The SBM has served as a catalyst for local economic development and provided a platform for India to better position itself in global trade. India’s emphasis on sanitation underlines a cleaner environment and improved quality of life for millions of citizens; it helps India become more attractive for foreign investments and tourists; it enables India’s industries to become more competitive in the world economy. Supply channels that are clean and efficient can contribute to lower costs and more export opportunities, thereby benefiting the economy.
But more remains to be done to maintain the progress achieved in eliminating open defecation in India. Osbert, speaking on a panel titled ‘Water security: investments, innovations and reforms for a sustainable future’ at the 2025 EBRD Annual Meeting, said India’s government admits that open defecation is still an issue, and that it risks backsliding should it not invest more resources.
Osbert reported that the Indian parliament allocated $17 billion to the sustainability phase of the SBM, a decision that will enhance India’s prospects of sustaining its progress toward ending open defecation.
