I found a fascinating article from September 2006, describing the problems with water and sewage in India, specifically: New Delhi. The caption:"Thirsty giant: In teeming India water crisis means dry pipes and foul sludge"
The description of the dire situation is very vivid and appaling. Maybe half the population doesn't have access to tap water, and those who have, have water only a few hours a day, maybe like 3 hours. Two thirds of the population, or some 700 million people have no sewage. Normal life in India is really beyond what a Westener can imagine - it's harsh, poor, and incredibly dirty, it's really a totally different world. Read the superbly written article by SOMINI SENGUPTA, in the NY Times (linked above). I have visited India and lived a while in "developing" countries, so it was no surprise for me. Still, it makes you think.
India doesn't lack water - as anyone who has experienced some of the mosoon rains there knows. Water pipe laying and sewage treatement isn't rocket science, neither does it cost terribly much. But that's the way the world is. Poverty and incompetence, there is no magic cure to it.
One lesson can be learned: there is no hope for the environment in a poor country. Poor countries are dirty, they can't afford to invest in a clean environment. India is incredibly dirty. Communist Russia was an environmental disaster. So are poor neighborhoods in all countries. You fight poverty, the environment takes care of itself, because affluent people demand, and pay for, a clean environment. Any "green" measures that hinder developement and perpetuate poverty will have a negative effect on the environment.