KARACHI, June 21: The market of mineral water bottles has risen by at least 15 per cent a year as the quality of tap water depletes persistently in Pakistan. The quantum of the demand is projected to be around 1.1 billion litres as the awareness about the quality of drinking water grows in society.

“The demand upsurge for the bottled water has been powered by urban middle class that aspires to switch to bottled water to avoid water-borne diseases. Besides, use of bottled water has also been treated as status symbol in middle income families that tends to follow the lifestyle of elite in Pakistan”, a market observer stated.

Eying the trend many businessmen have hopped in the bandwagon of mineral water business over the last three years.

A leading mineral water producer told Dawn that five years back the market was hardly 25 per cent of the current level of 1.1 billion litres a year.

Most multinational offices purchase known brands of mineral water, the local companies rely on low priced water for their staffers and workers. People living in posh areas seemed to be switching over to bottled water. The growth in bottled water demand is almost similar to that of tetra milk industry that has grown exponentially in the last few years.

The consistent increase in demand has led to persistent rise in the price of tetra milk. The situation seems to be similar in the mineral water business.

A 1.5-litre mineral water bottle produced by a leading company now costs Rs40 as compared to Rs36 few months back. It was priced at Rs26 in April 2010.

Similarly, the price of 12-litre bottle is now tagged at Rs120 as compared to Rs95 in April 2010. The 19-litre bottle price is Rs170 as compared to Rs150.

Many companies do not print the price on small and bigger bottles which allows retailers to charge unilaterally higher prices in areas where demand overtakes supplies whereas in areas of low demand they sometimes offer discounts.

A mineral water producer in Site area, who asked not to be named, said the price hike was caused by rising price of raw material used for making plastic bottles. “Resin price (raw material used in making plastic bottles) is linked with the oil prices,” he said.

Besides, higher transportation cost followed by rising utility bill charges are also blamed for price rise in mineral water which usually push up cost of manufacturing.

He said to cash on the public preference to bottled water the country has witnessed a mushroom growth of mineral water companies in the informal sector. “There is no guarantee of quality but no one can deny that such outfits are also experiencing high growth capitalising on growing demand in low income areas because of comparatively lower rates.

As a result bigger companies are finding it hard to penetrate in certain areas. A well-placed source in water industry dismissed the impression that high price of mineral water is the limiting factor for growth in certain areas and markets.

He added that people without bothering about the quality of water prefer low-priced water due to lack of awareness about the process involved in purifying the water.

Meanwhile, the biggest player in the sector Nestle Pakistan Limited did not respond in time to the Dawn’s queries related to market dynamics and prospects of bottled water business in the country.

Chairman All Karachi Tajir Ittehad Atiq Mir said that majority of traders cannot afford costly mineral water so they prefer low-priced water despite knowing the fact that water is inferior in quality.

For example, he said in Arambagh furniture market, 40 per cent of the traders use water supplied by various vehicles at a price of Rs15-20 per bottle. Around five per cent bring water from their homes while 55 per cent use water being supplied by push cart owner or often dubbed as mashki.

Giving an example, a trader said that around 300 shopkeepers out of 500 in Rex shopping centre use can-water at a price of Rs30.