ADB, India sign $200 million loan for expanding urban services in Rajasthan

The Government of India and Asian Development Bank (ADB) today signed a $200 million loan as additional financing for the ongoing Rajasthan Secondary Towns Development Sector Project to expand water supply and sanitation systems and enhance urban resilience and heritage living in selected towns.

The signatories to the loan agreement were Mr. Vumlunmang Vualnam, Additional Secretary, Department of Economic Affairs, Ministry of Finance, for the Government of India, and Takeo Konishi, Country Director of ADB’s India Resident Mission, for ADB.

After signing the loan agreement, Mr Vualnam stated that the additional financing will support the Government of Rajasthan in its commitment to reduce basic infrastructure gaps in its secondary towns by expanding water supply and sanitation services and improving livability in selected urban local bodies.

“The project will incorporate various innovative and climate-resilient solutions for expanding basic urban services and incorporate nature-based solutions to rehabilitate heritage structures besides piloting public-private partnerships in the state’s water and sanitation sector to deepen private sector engagement,” said Mr. Konishi.

The ongoing project—approved in September 2020—has so far laid 1,451 kilometer (km) of water supply pipes, 1,110 km of sewer pipes, and connected 68,098 households to water services in selected secondary towns in Rajasthan.

The additional financing will improve water supply systems in at least seven towns by converting all groundwater sources to surface water, replacing about 700 km of leaking water pipes, installing 1,400 km of new water supply pipelines, and providing 77,000 households connections with water meters. It will also establish three new water treatment plants.

At least eight towns will be covered for improvement to sanitation systems by rehabilitating at least 580 km of sewers, building seven sewage treatment plants with co-treatment units to process fecal sludge and septage, and connecting at least 54,000 households to the sewage system.

A new feature in ADB’s support is the water facility development for urban resilience improvement and heritage-sensitive urban development in at least eight heritage towns or towns with strong tourism potential. This includes the reconstruction of water structures with heritage value, incorporating nature-based solutions to improve climate resilience. It will also rehabilitate at least 20 heritage or heritage-like structures to improve the living environment and attract more tourists.

In addition, it will create a special purpose vehicle through a public–private partnership to address water security issues in Rajasthan’s manufacturing industry and to encourage private sector investments and financing. This will establish designated pipe networks to carry treated wastewater from the sewage treatment plants to industrial facilities.

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PPG/KMN