"We're always sick because the water is so terrible," complains Akhtar, a telephone operator who earns just Rs 1,500 ($29) a month. Like many residents, she says the search for safe water is a daily struggle, because the water supply is sporadic and contaminated with sewage. So she scrapes together enough money to buy Nestle Pure Life, at Rs 18 a bottle. "It's expensive, but the kids need it when they're sick,"' she explains.

For Nestle SA, the world's largest food company, consumers like Akhtar are fast becoming part of a vast and potentially lucrative new market. Already the global leader in bottled water, with designer labels like Perrier and San Pellegrino, the Swiss food giant is launching Pure Life as an affordable global water brand aimed specifically at the poor and thirsty in the developing world.

Apopulist Perrier? Sort of. Along with leveraging its famous name -- Pure Life is the first water with the Nestle moniker -- the company is spending $100 million over the next three years to roll out Pure Life in as many as 20 countries, hoping to increase volume to one billion litres by 2002. Pure Life made its debut in Pakistan late last year and will soon go to Brazil, with megamarkets like India and China under consideration.

The launch of Pure Life raises delicate issues about the business of selling water in developing countries, at a time when an estimated one billion people lack access to basic water services. In Pakistan, that has tragic consequences: 40 per cent of deaths of children below the age of five here are caused by waterborne diseases.

"Nestle steps in and fills a need, but turns water into a luxury," says Peter Gleick, director of the Pacific Institute, a think tank based in Oakland, Calif. Others worry that the arrival of private-sector products like Pure Life could encouragegovernments to curtail further investments in water infrastructure.

Nestle already has stirred controversy in the developing world, with allegations that it engages in overly aggressive tactics to market its powdered baby formula. "We don't want Nestle going in and saying to women, `Bottled water is safe,' to dissuade them from breast-feeding," says Patty Rundell, a campaigner at Baby Milk Action, an activist group in Cambridge, England.

Nestle says it strictly adheres to World Health Organisation marketing guidelines on baby formula. There is no evidence in Pakistan to suggest that Nestle is using Pure Life to cross-market baby formula.

Peter Brabeck, Nestle's chief executive, says Pure Life isn't intended to be "a solution" to the world's water problems. He says the idea sprang partly from his experience living in Latin America where "the water tasted terrible." "I said, 'Why not create a product that fulfils basic needs like taste, safety and high mineral content, but which is made locally to reducecosts?'" he recalls.

It's everywhere

So far, Pakistanis are reaching for Pure Life in record numbers. After six months, the brand has taken over 50 per cent of the country's small bottled-water market of 33 million litres (35 million quarts) a year, according to Nestle.

Pure Life is everywhere -- at roadside stalls, gas stations and rest stops. It's hawked at street corners in traffic-clogged Lahore. Middle-class shoppers buy it by the case in supermarkets. On the remote mountain road leading from Islamabad to the hill town of Murree, Pure Life billboards urge drivers to "drive only Nestle Pure Life." At small stores along the way, a flurry of banners proclaim: "Pure Safety, Pure Trust. The ideal water. From Nestle with love."

The potential is enormous. Currently, per capita consumption of bottled water in developing countries like India and Pakistan is less than half a litre a year, compared with 111 litres in France and 45 litres in the US, according to Euromonitor, a market research company.And with the once-strong European market now flat, the fastest-growing markets for bottled water are developing countries like India, where volume nearly quintupled between 1993 and 1997. Nestle has about 16 per cent of the global market for bottled water, concentrated mainly in Europe and the US, but only one per cent in Asia.

Still, making Pure Life a global blockbuster won't be easy, even for a marketing machine like Nestle. Local competitors in Pakistan are already scrambling to protect their turf. Nestle's main rival, France's Danone SA, the world's No. 2 water company and owner of the Evian brand, is eyeing emerging markets, too.

Nestle's Pure Life marketing strategy stumbled at first. Two months before its launch, Nestle asked its Lahore ad agency, Interflow Communications Ltd., to raise public awareness of water hygiene issues, which resulted in a series of "awareness seminars." Pakistani health officials appeared, saying that urban water supplies were contaminated and that even 14 bottled waterswere tainted, according to tests by the country's environmental agency.

Nestle's name wasn't mentioned. But a spokesman said the company soon grew unhappy with the "tone" of the seminars and asked Interflow to discontinue them. "We didn't want to be perceived as stirring up controversy, although what was said by the officials was factually correct and not planted by Nestle," explains Francois Perroud, the Nestle spokesman in Switzerland.

Perroud acknowledges that media coverage of the seminars helped Pure Life, though he maintains that Nestle didn't violate ethical marketing standards. Still, he says the company won't repeat the seminars in other launch countries.

Regardless, the seminars leave a bad taste in the mouths of some Pakistanis. "These foreign companies are misleading the people to make money," charges Mohammed Amin, managing director of the Lahore Water Supply Company, after learning of the seminars. He says the local water is basically good when it is pumped out, but that rusty pipes andleaking sewage degrade its quality by the time it comes out of the tap. That's why water bills carry a warning to customers to boil it before drinking, Amin says.

Pure Life won't reach everyone in Pakistan, where the per capita annual income is roughly $495. "The fact that everybody can't afford Pure Life is unfortunate, but does that mean we shouldn't sell it at all?" asks Hans-Dieter Karlscheuer, director of Paris-based Perrier-Vittel SA, Nestle's water division. "We can't change the world. We can only try to improve it a little."

(The Asian Wall Street Journal)