1. Water crisis is bad but a good fraction of people (most of the upper and middle class) are getting by through exploitation of ground water. My guess would be half of the city still has usable ground water accessible through bore wells including where I live. However these Wells going dry is a common occurence. Someone is digging a deeper well every day in my street alone (no exaggeration). Heck, my house with 4 tenants is already exhausting it's 5th borewell. The day these Wells collectively stop giving water is when things are going to get very interesting.
2. The government here doesn't really consider water as an utility it's actually responsible for. All the articles you see are mostly talking about drinking water. The pipe system in the city is barely capable of only providing drinking water to most people even if most of the water sources are full. It is everyone's assumption that if you need more than a few tens of liters per day per person for things like showers that's completely on you, not the government. This is not going to change anytime soon. The entire plumbing system is riddled with leaks everywhere and no metering. People have also built systems to abuse this plumbing (by using motors) so unless we get a sudden abundance of water this system cannot provide the water the city needs.
3. Most importantly, if ground water runs out, the city really doesn't have any alternative for water in any developed country sense. No usable River for hundreds of miles and every river that CAN provide water originates in a different state and none of them are prepared to share their resources.
4. Chennai the city alone has more people than most Scandinavian countries. The desalination plants are not going to provide more than a few tens of liters per head even if their capacity multiplies by ten.
5. While there's always blame on people here for wasting water, I'd argue that it's outrageous. Even the worst offenders don't waste that much water compared to any Western standards. My household is definitely in the lower quartiles of how much water we use but I estimate we use at best 50-70 liters of water per head per day including everything. Even if I don't want to think like this, I subconsciously think twice before using the toilet (maybe if I hold it for a while I can go one less time?). People here should not be blamed for abusing water, water should be a basic necessity for our lives.
6. Just three years back this city literally drowned in a flood that was far worse than what happened in Houston.