Vedanta group firm Hindustan Zinc today said it had signed an agreement with the Rajasthan government to set up the first sewage treatment plant in the state at Udaipur with a cost of Rs 170 crore.

In a statement, the Udaipur-based company said the agreement was signed with the Rajasthan government authorities and Udaipur Municipal corporation yesterday.

"As per the agreement, Hindustan Zinc Ltd (HZL) will construct a 20 million litres per day capacity sewage treatment plant (STP) in Udaipur with a cost of Rs 170 crore. The plant will only be treating domestic sewage and not industrial sewage," it said.

The sewage treatment plant will be constructed on design- build-own-operate-transfer basis, it added.

The company further said that sewage treatment will generate a large quantity of manure, that will be sold by Udaipur Municipal Corporation on fortnightly basis and would generate a revenue of Rs 1 crore every year for the department.

Udaipur--the city of lakes, generates almost 70 million litres of sewage per day due to rising population and infrastructure development, the company said.

"Saving water has always been a focus area for Hindustan Zinc and our all units operate on 'zero discharge' basis. We have been quite successful in reducing water consumption at our plants. This project is a significant step towards water conservation and care for environment," HZL CEO Akhilesh Joshi was quoted in the statement.