Central Government has made a major policy change to enhance environmental compliance and reduce the procedural load on the environment by amending the Environment Impact Assessment (EIA) Notification, 2006, to exempt Common Effluent Treatment Plants (CETPs) from the need of obtaining prior Environmental Clearance (EC).

Previously, CETPs were classified under the EIA Notification item 7(h) and needed a compulsory environmental clearance prior to being established. Nevertheless, the Government, after considering the developments in technology, the regulatory framework, and the changing industry practices, the Government came to the conclusion that CETPs could operate efficiently under the current pollution control regulations without obtaining individual Environmental clearance.

This amendment is likely to promote the growth of additional CETPs within industrial clusters, which will result in the management of wastewater and environmental compliance. The change also aligns with India's growing focus on sustainable industrial operation and effective pollution control infrastructure.

Why the Government Considered Exempting CETPs from Environmental Clearance?

Over the past decade, a significant change in the treatment of industrial wastewater in India has been noticed. Previously, most industries relied solely on centralized treatment plants and lacked effective in-house treatment systems. Some industries, such as pharmaceuticals, textiles, chemicals, paints, electroplating, and fertilizers, have today updated their systems and have embraced better treatment technologies.

Advanced treatment systems and monitoring systems have become more popular in industries and have guaranteed increased compliance and accountability. Moreover, Zero Liquid Discharge (ZLD) systems are becoming common in numerous industries. With ZLD systems, the wastewater is completely recycled and treated within the industrial process, ensuring that untreated effluent is not discharged into the environment.

In this transformed situation, CETPs have been more efficient in terms of collective compliance, not just common disposal plants. They also offer industries an affordable means of treating wastewater while guaranteeing centralized monitoring and pollution control. The Government also noted that CETPs assist in mitigating environmental risks since the pollution control authorities can monitor treatment in a single location rather than tracking various individual discharge points.

The other significant consideration was that industries and treatment facilities are already controlled under: 

• Water (Prevention and Control of Pollution) Act, 1974, and
• Air (Prevention and Control of Pollution) Act, 1981

Under these laws, industries are required to get Consent to Establish (CTE) and Consent to Operate (CTO) from State Pollution Control Boards (SPCBs) or Pollution Control Committees (PCCs). Such authorities issue inspections, standards, and compliance.

Since this regulatory system is already robust, an extra environmental clearance procedure was not deemed necessary for CETPs.

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What Has Changed in the EIA Notification, 2006

According to the initial EIA Notification of 2006, there were some types of projects that required Environmental Clearance before construction or operation. In the schedule dealing with physical infrastructure and environmental services, CETPs were included in the list of item 7(h).

Upon considering the representations and recommendations made by the expert bodies, the Government chose to take CETPs out of this category. The process of amendment involved:

• Examination by the sectoral Expert Appraisal Committee.
• Further review by the Expert Advisory Committee.
• Publication of a draft notification in October 2025, inviting objections and suggestions.
• Consideration of public feedback received within the prescribed period.
• Final amendment issued under powers granted by the Environment (Protection) Act, 1986.

Consequently, the Common Effluent Treatment Plants under Item 7(h) have been excluded from the EIA Notification schedule, and therefore, CETPs are not subjected to prior Environmental Clearance. Nonetheless, it does not imply that CETPs are not regulated. Rather, the regulatory control is entirely transferred to the pollution control authorities by means of consent.

What the Amendment Means for Industries and Compliance Requirements

The exemption makes the implementation of projects easier without weakening environmental protection. All the pollution control requirements should still be met by the industries and CETP operators.

• Faster Development of Treatment Infrastructure: Formerly, CETP projects usually faced delays due to lengthy environmental clearance processes. With EC no longer necessary, the timeframe of the project can be reduced, promoting the installation of more treatment plants in industrial clusters.
• Continued Role of Pollution Control Boards: CETPs must still obtain:

1. Consent to Establish before construction
2. Consent to Operate before operations begin

SPCBs and PCCs will continue to monitor effluent standards, treatment efficiency, and compliance conditions.

• Promotion of Collective Compliance: CETPs enable small and medium industries to treat wastewater collectively rather than installing their own plants. This saves on the compliance expenses and enhances the environmental monitoring.
• Support for Sustainable Water Management: As more industries move towards Zero Liquid Discharge systems and recycling, mitigating freshwater consumption by the industries and reduce the amount of wastewater discharged.
• No Relaxation of Pollution Norms: It should be mentioned that the exemption does not loosen discharge standards. The industries are still required to comply with the effluent quality standards required by the pollution control laws. Failure to comply can result in fines or a shutdown.

Conclusion

The Common Effluent Treatment Plants are now exempt from the previous Environmental Clearance, which, which is a viable change in India's environmental regulation, emphasizing effective monitoring over procedural approvals. The CETPs will still be operating under the guidance of the Pollution Control Boards through the current consent and compliance systems, whereby the wastewater will be treated as per the standards. 

It is expected that the change will help develop treatment facilities in industrial clusters more rapidly and retain environmental protection. The amendment will foster responsible industrial growth by fostering collective treatment solutions and better wastewater management. Its success will, however, be determined by the strict implementation of authorities and industries to ensure that environmental protection remains a priority beside economic growth.