"I have been preparing for this film for a long time, but always wanted an Indian partner that has the same passion for the film as I do and in Adi (Aditya Chopra), I have finally found that," Kapur said in a statement.
"It is a huge production that demands futuristic sets and large action pieces. With YRF, I have found a perfect home for 'Paani'," he added.
The film is based in a future world where wars over water have broken out. Water is now owned by international corporations who use thirst as a weapon of control. In one such future city, a young love story breaks all the rules and in the ensuing war, water flows back to its people.
'Paani' is said to have a strong Indian and western cast, headed by a young leading actor from India and a young leading actress from the west, the statement read. It was reported that Hrithik Roshan will essay the male lead. But no confirmation has been made on that front.
The movie, which will go on floors mid-2013, will be shot in India and overseas. It will have music by the Oscar-winning A. R. Rahman.