Minister for Gas Relief Babulal Gaur told IANS that a Rs.17-crore (Rs.10.7 million) scheme has been prepared in the wake of reports that drinking water in the 13 gas-hit localities of Bhopal was contaminated.
Six major water tanks would be constructed, and water from the Kolar dam would be supplied through pipelines, he added.
Expressing dissatisfaction over the working of the hospitals run by the Gas Relief Department, he promised to bring about "immediate improvements".
Victims of the Bhopal gas tragedy, one of the world's worst man-made disasters, have been protesting in New Delhi for the past five days demanding safe drinking water.
The protestors include people living in the localities affected by ground water contamination caused by the leak of over 40 tonnes of hazardous gas from the Union Carbide's pesticide plant.
The leak, which killed an estimated 20,000 people and maimed several thousands, remains one of the world's worst industrial disasters.
According to social activists, ground water samples collected near the Union Carbide plant have shown contamination levels 10 times higher than in other areas.
High levels of heavy metals such as nickel, chromium, mercury, lead and other toxic materials have been found in the soil.
Thousands of survivors, including those born after the disaster, are still battling the after-effects of the deadly leak - from illnesses ranging from deep psychiatric disorders to stunted growth, various studies have proved.
Protestors are also demanding speedy prosecution of Union Carbide Corp and its officials and the blacklisting of Dow Chemical, which bought Union Carbide in 2001, till it pays for the environmental and health damage caused by the dumping of hazardous wastes.
In addition, the victims are demanding that a National Commission on Bhopal tragedy be set up for long-term medical care and research and economic and social rehabilitation of the victims.
They are also insisting that the Bhopal disaster be included in the curricula of educational institutions and a memorial be erected in memory of victims.