Safe drinking water is a basic need, and millions of Indian homes, offices, shops, restaurants and events rely on packaged drinking water, especially 20-litre jars delivered to the door. A packaged drinking water plant can serve a town or a part of a city with steady daily demand.
It’s also a regulated food business, and the rules changed recently. Older guides say BIS certification is mandatory; that requirement was removed in October 2024, and FSSAI now regulates packaged water as a high-risk food category, with mandatory inspections and, from 1 January 2026, a specific testing scheme. This guide explains the current rules and how to run a plant well.
Key points
Table of Contents
- Packaged drinking water is a food, and plants need an FSSAI licence or registration. FSSAI treats packaged drinking water and mineral water as high-risk food categories.
- Mandatory BIS certification (the ISI mark) was withdrawn by an FSSAI notification dated 17 October 2024. Instead, plants face mandatory inspection before licensing, annual inspections, annual third-party audits for centrally licensed units, and FSSAI’s testing scheme from 1 January 2026.
- Groundwater extraction usually needs permission from the Central Ground Water Authority or your state’s authority.
- Pollution control consent is needed for the plant and its reject water.
- Plastic packaging brings Extended Producer Responsibility (EPR) obligations under the Plastic Waste Management Rules.
- Under GST 2.0, packaged drinking water moved from 18% to 5% from 22 September 2025; check your product’s HSN code.
The market in numbers
Packaged water plants fall under food and beverage manufacturing in MoSPI’s surveys. In 2023-24, small food products manufacturing establishments added ₹4,39,316 of value a year on average in urban areas, and units with hired workers added ₹9,26,477 on average. A water plant always needs a team for production, filling and delivery.
Step 1: Plan your plant
- Products: 20-litre jars for homes and offices, and smaller bottles (such as 1 litre and 500 ml) for retail and events. Jars need less packaging investment and suit local delivery; bottles need more machinery and branding.
- Capacity: start with a realistic daily output, such as a few thousand litres a day, based on local demand you’ve checked.
- Location: a reliable water source, power supply, road access for delivery vehicles, and land use that permits a food processing unit.
- Layout: separate areas for raw water treatment, the processing and filling room (kept hygienic and enclosed), a laboratory, storage of empty and filled containers, and dispatch.
Step 2: Water treatment and equipment
A typical process includes:
- raw water storage and pre-treatment: sand filters and activated carbon filters
- reverse osmosis (RO) to remove dissolved solids, with mineral dosing where needed to meet standards
- disinfection: ultraviolet treatment and ozonation, which also protects water after filling
- micron filtration before filling
- jar washing and filling: automatic washing, rinsing, filling and capping machines for 20-litre jars, or rinsing, filling and capping lines for bottles
- a laboratory with equipment to test key parameters, plus arrangements with accredited labs for full testing
- labelling, batch coding and shrink-sealing equipment
Buy from reputable suppliers who can show plants they’ve installed, and ask for guaranteed output and water quality.
Step 3: FSSAI licensing as a high-risk food
- Licence category: apply on FoSCoS for registration, a state licence or a central licence, depending on your capacity and turnover. Confirm the correct category for packaged drinking water there.
- Inspection before licensing: as a high-risk category, your premises must be inspected before the licence or registration is granted.
- Annual inspections: FSSAI’s risk-based inspection policy sets inspections of packaged drinking water and mineral water plants once a year.
- Third-party audits: centrally licensed manufacturers in high-risk categories must be audited annually by an FSSAI-recognised food safety auditing agency.
- Testing scheme: from 1 January 2026, FSSAI’s specific scheme of testing for packaged drinking water and mineral water applies. Follow its requirements for testing frequency, parameters and accredited laboratories.
- Standards: water must meet FSSAI’s standards for packaged drinking water, which cover physical, chemical and microbiological parameters.
You can still choose voluntary BIS certification, which some buyers value, but it’s no longer required for packaged drinking water. See our FSSAI guide.
Step 4: Groundwater, pollution and other approvals
- Groundwater permission: units that extract groundwater, including packaged drinking water plants, usually need a no-objection certificate (NOC) from the Central Ground Water Authority or the state’s groundwater authority, depending on your state, with conditions on extraction, metering and recharge.
- Pollution control consent: Consent to Establish and Consent to Operate from your State Pollution Control Board, including how you’ll use or dispose of RO reject water.
- Plastic EPR: if you sell water in plastic bottles or jars under your brand, you’re likely a brand owner under the Plastic Waste Management Rules, and must register on the Central Pollution Control Board’s EPR portal and meet targets for collecting and recycling plastic packaging.
- Legal Metrology: register as a packer of packaged commodities, and label net quantity, MRP and other details correctly.
- Trade licence, factory registration once you reach the worker threshold, fire safety, and Udyam registration (free). See our Udyam guide.
Step 5: GST
Under the GST 2.0 changes from 22 September 2025, packaged drinking water, including water in 20-litre jars, moved to 5%. Check the HSN code and rate for your products on the CBIC website, and register for GST once your turnover crosses the threshold, or earlier, since distributors and business buyers expect it. See GST registration for small businesses. Make invoices with Advanton’s free GST invoice generator.
Step 6: Labelling
Labels on every jar or bottle should include, as required by FSSAI and Legal Metrology rules:
- the product name (packaged drinking water or mineral water)
- your name and address, and FSSAI logo and licence number
- batch number, date of manufacture or packing, and best-before date
- net quantity and MRP
- the veg symbol and any other required declarations
Step 7: Distribution
- 20-litre jars: home and office delivery on fixed routes, with a deposit on jars; shops and distributors as resellers.
- Bottles: retailers, restaurants, hotels, event organisers, offices and institutions.
- Pricing: cost each jar or bottle from treatment, power, labour, packaging (caps, labels, seals), jar washing and replacement, transport and overheads, and check local market prices.
- Jar management: track jars out and returned, and replace damaged jars; lost jars are a major hidden cost.
An illustrative example
These figures are illustrative. A small plant fills 600 twenty-litre jars a day. If each jar sells to customers and shopkeepers for an average of ₹35, daily sales are about ₹21,000, or around ₹6.3 lakh a month over 30 days. Costs include power, filters and consumables, caps and seals, labour, delivery vehicles and fuel, testing, jar replacement, and loan instalments on equipment. The margin depends heavily on keeping delivery routes efficient and jar losses low.
Jar deposits and route planning
Twenty-litre jar businesses succeed or fail on logistics:
- take a deposit for each jar with new customers, and record jars at each address
- swap empty for full at every delivery, and count jars daily
- replace damaged, scratched or old jars, which customers dislike and which are harder to clean
- plan routes by area, with fixed delivery days or slots, so each vehicle delivers as many jars as possible per trip
- use a simple app or register for orders, payments and jar balances
- collect payments by UPI, monthly for regular customers
Lost jars, empty trips and unpaid accounts quietly eat into margins.
Step 8: Quality every day
- test raw and treated water regularly, and keep records
- clean and sanitise jars, lines and tanks on schedule
- maintain RO membranes, UV lamps and ozone generators
- control hygiene in the filling room: clean clothing, head covers, handwashing and restricted entry
- keep samples of each batch, and trace complaints to batches
Step 9: Get customers
- Offices, shops, clinics and housing societies for regular jar delivery.
- Restaurants, hotels and caterers for jars and bottles.
- Events for bottled water.
- Google Business Profile and the India Business Directory: list your water plant free.
- WhatsApp ordering and UPI payments for home delivery. See UPI and digital payments.
A getting-started checklist
- Check demand, competitors and prices in your area.
- Secure a site with a reliable water source and power.
- Apply for groundwater permission and pollution control consent.
- Install treatment, filling and testing equipment from a reputable supplier.
- Apply for the right FSSAI licence and prepare for the pre-licence inspection.
- Register for plastic EPR, Legal Metrology, GST and Udyam.
- Set up testing under FSSAI’s scheme, and daily quality records.
- Plan delivery routes, jar deposits and pricing.
Common mistakes
- Relying on outdated advice that BIS is mandatory, while missing FSSAI’s high-risk requirements.
- Skipping groundwater and pollution approvals.
- Ignoring plastic EPR obligations for branded packaging.
- Poor jar hygiene and inadequate testing.
- Losing track of jars in distribution.
Frequently asked questions
How long does it take to set up a water plant?
Usually several months, allowing for groundwater and pollution approvals, equipment installation, the FSSAI pre-licence inspection and testing.
Is BIS certification mandatory for packaged drinking water?
No. FSSAI withdrew the mandatory BIS requirement by a notification dated 17 October 2024. Packaged water is now regulated as a high-risk food, with inspections before licensing, annual inspections and FSSAI’s testing scheme from 1 January 2026.
What GST applies to packaged drinking water?
5% after GST 2.0, including 20-litre jars. Check your product’s HSN code.
Do I need groundwater permission?
Usually yes, from the Central Ground Water Authority or your state’s authority, if you extract groundwater.
Do I need to register for plastic EPR?
If you sell water in plastic packaging under your brand, you’re likely covered as a brand owner under the Plastic Waste Management Rules.
Sources
- FSSAI, Food Safety Compliance System (FoSCoS)
- Bureau of Indian Standards
- Central Ground Water Authority
- Central Pollution Control Board
- Central Board of Indirect Taxes and Customs, GST
- MoSPI, Annual Survey of Unincorporated Sector Enterprises 2023-24, full report
Last reviewed November 6, 2026. Startup costs are estimates; check local prices, licensing and tax rules before you commit money.
