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World Bank approves $300 mn to boost water & sewerage services in Tamil Nadu
The program will benefit approximately two million residents
The World Bank has given the green light to a $300 million initiative aimed at fortifying water and sewerage services in Tamil Nadu. The program is set to benefit approximately two million residents by providing enhanced access to essential services in the face of escalating climate challenges, a release by the World Bank said.
Tamil Nadu, recognized as one of India’s most urbanised states, grapples with the adverse effects of climate shocks, including floods and droughts. The newly sanctioned “Tamil Nadu climate resilient urban development program” emerges as a strategic response to these challenges, with a particular focus on ensuring climate-resilient cities for the rapidly expanding population. The initiative targets 21 Urban Local Bodies (ULBs) within Tamil Nadu, intending to modernise their service delivery systems. With a primary emphasis on quality and efficient water supply and sewerage services, the program aspires to bolster the region’s resilience against the impacts of climate change.
Auguste Tano Kouame, the World Bank’s country director for India, underscored the program’s significance in light of the country’s urbanisation trends, stating, “By 2030, almost 70 percent of India’s new jobs will be generated in cities and more than 18 million people will move to cities. As centers of economic growth, it is critical to strengthen their ability to cope with the impacts of climate change and ensure continuity in basic service delivery.”
The program has adopted a forward-looking approach. It envisions the creation of designated green spaces and parks within ULBs, promoting a sustainable and ecologically conscious urban landscape. The innovative financing model includes leveraging the private sector through performance-based contracts, issuing municipal bonds, and supporting urban governance reforms.
Over the past two decades, the World Bank has actively collaborated with Tamil Nadu and ULBs to establish and scale-up a state-level urban institution. This institution, functioning as a public-private partnership facility, leverages diverse financial sources for urban infrastructure projects. The funding, a $300 million loan from the International Bank of Reconstruction and Development (IBRD), utilizes the blended financing instrument of program-for-results (PforR) with investment project financing (IPF).
This approach links disbursement of funds directly to the achievement of results while providing a 32-year maturity period with a grace period of seven years.
Social media caption-Tamil Nadu, recognised as one of India’s most urbanised states, grapples with the adverse effects of climate shocks, including floods and droughts.
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