ADB, India Sign $275 Million Loan for Upgrading Urban Services in Madhya Pradesh

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NEW DELHI, INDIA (19 June 2017) — The Asian Development Bank (ADB) and the Government of India today signed a $275 million loan for improving urban services to about 300,000 households in 64 small towns in the central Indian state of Madhya Pradesh.

The signatories to the loan agreement for the Madhya Pradesh Urban Service Improvement Project were Raj Kumar, Joint Secretary (Multilateral Institutions), Department of Economic Affairs in the Ministry of Finance, who signed on behalf of the Government of India, and L. B. Sondjaja, Deputy Country Director of ADB’s India Resident Mission, who signed for ADB. The project agreement was signed by Vivek Aggarwal, Secretary, Urban Development Department, for the government of Madhya Pradesh.

“Madhya Pradesh needs substantial investments to keep pace with its rapid urbanization and continuous water supply is vital for improving living standards and enhancing economic growth. Sustainable piped water supply will foster inclusiveness by giving more of the state’s population easier access to basic services, especially for women and girls.” said Mr. Raj Kumar after signing the loan.

“ADB’s continued support to the state’s urban development, through this project, will improve further the quality, coverage, efficiency, and sustainability of urban service delivery, stabilize and deepen institutional capacity, and improve long term water service management,” said Mr. Sondjaja. “A key element of the project is the use of design-build-operate contracts including 10-years operation and maintenance to ensure better sustainability of the water service operation and financial viability.”

The project will develop sustainable, inclusive, and climate-resilient water supply in 64 small and medium-sized towns, and integrated storm water and sewerage infrastructure in two heritage towns of Khajuraho and Rajnagar.

Madhya Pradesh which is the second-largest state in the country in terms of geographical area, and has a population of about 73 million, is urbanizing fast. The proportion of its urban population is expected to increase from 28% in 2016 to 35% by 2026. The project supports the State government’s priority to develop urban infrastructure. Previous ADB urban investments in the state have improved access to safe drinking water for more than 5 million residents in 4 major cities.

Along with ADB’s loan, the Government of Madhya Pradesh will provide counterpart support of $124 million. The project will run for almost five years with an expected completion date of June 2022.

ADB, based in Manila, is dedicated to reducing poverty in Asia and the Pacific through inclusive economic growth, environmentally sustainable growth, and regional integration. Established in 1966, ADB is celebrating 50 years of development partnership in the region. It is owned by 67 members48 from the region. In 2016, ADB assistance totaled $31.7 billion, including $14 billion in cofinancing.

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