A 30-year war ended in Sri Lanka north and east in 2009. The east coast is sunny and dry towards mid-year when the traditional tourist hotspots in the West coast are hit by monsoon rains.
"This ground-breaking project reflects not only the Hayleys Group’s and our partner Veolia Water’s, competencies in large-scale environmental solutions, but also our commitment to support economic resurgence in post-conflict Sri Lanka,” Hayleys chairman Mohan Pandithage said in a statement.
"It illustrates the potential for public-private partnerships, particularly in infrastructure development."
Nalaka Godahewa the head of Sri Lanka's tourism development authority said making sure infrastructure was in place was a challenge faced by the state as it helped the tourism sector to grow.
The plant can treat 750 square meters of sewerage and kitchen waste a day and is designed to recycle all water.
Patrick Rousseau of Veolia Water India said the plant's 'green technology' helped keep Sri Lanka remain a beautiful country.
Under the BOT contract, the plant will offer concessionary rates to hotels passing on concessions received from Sri Lanka's Economic Development Ministry.
The plant has recruited and trained people from the Passikudah area to operate and maintain it under Puritas and Veolia Water supervision.Already two of the 13 hotels are running and the rest are expected to open in 2012 when the resort will have 930 rooms.
Puritas is part of Sri Lanka's Hayley's group's Haycarb division which makes activated carbon products. It claims the world's top stop for coconut shell based activated carbon and has plants in Sri Lanka, Indonesia and Thailand.