This chapter examines Kerala's experience of drinking water governance, especially the institutional shifts with some foreign assisted projects for the provision of drinking water. It presents the question whether such a process will lead to a weakening of the public institutions responsible for drinking water provision that might have a differing impact on various societal groups regarding access and control over water. The chapter discusses the history of Kerala's public sector water provision and the financial crisis that compelled the Kerala Water Authority (KWA) to go in for foreign assistance. The KWA is the only public sector organization engaged in harnessing and distributing piped drinking water in Kerala, with a huge installed capacity. The foreign assistance to urban and rural sectors worked on different philosophies and approaches: supply-driven public provision of drinking water to the urban population, and demand driven, community-owned water supply to rural areas— from state to the community, through an emerging water market.