World Bank Approves $ 105 Million Project to Strengthen Urban Services in Punjab, India

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The World Bank Board of Directors today approved a $ 105 million Punjab Municipal Services Improvement Project to strengthen urban services in Amritsar and Ludhiana, the two largest cities in Punjab, India.

One of the main objectives of the project will be to provide efficient water supply and sanitation services in Amritsar and Ludhiana, cities which are the engines of economic growth in the state of Punjab. Improvements in water supply are expected to benefit more than 3 million people by 2025 and an estimated population of 5 million people by 2055. Industrial and commercial users would also benefit from a reliable and good quality water supply. .

Amritsar and Ludhiana get their water by pumping groundwater from hundreds of boreholes dug in the two towns. Pumping groundwater directly from these boreholes results in significant water loss and waste, as households have no incentive to save. Studies have also revealed that the groundwater in Amritsar district is contaminated with arsenic and the groundwater in Ludhiana with nitrates and other heavy metals. The project will shift the water supply from rapidly depleted and heavily contaminated underground sources to a centralized treatment plant drawing water from local canals (surface water sources). This change is likely to have significant health benefits, studies have shown.

The project will finance all new raw water systems, water treatment plants, transmission systems and reservoirs to provide clean water to cover entire cities as part of one design; Construction, operation and transfer contract (DBOT). The operator DBOT will manage the operation and maintenance of these water supply systems under the direct supervision of the municipal companies of the two cities through the water services at the city level.

“The rapid urbanization of Punjab has created thirsty cities. Overuse of groundwater is the inevitable victim, ”said Junaid Ahmad, World Bank Country Director in India. “This project aims to meet the challenge of urbanization and ensure access to sustainable and safe water for Amritsar and Ludhiana. Emphasis is placed on municipal capacities to plan, finance and deliver services and to harness the potential of surface water.

The government of Punjab has launched several initiatives to address gaps in urban service delivery and strengthen local urban organizations (ULBs) in the state. The state has delegated authority and responsibility for infrastructure development and service delivery to large municipal corporations. Several projects to improve waste management, water supply, sanitation, public lighting and public transport are currently underway.

“The government of Punjab has prioritized urban reforms and investments to address growing urban challenges. Through this project, we hope to fill the wider gaps in governance and institutions at several levels of the local government system in Amritsar and Ludhiana for an efficient and responsive system, and more of the time, efficient municipal service delivery. in both cities, ”said Yarissa Lyngdoh Sommer, Senior Urban Specialist and World Bank Task Team Leader for the project.

The focus on administrative and e-governance improvements, particularly those with a public interface (such as improved systems for permits, payments and grievance resolution), will benefit users of municipal services in both cities.

The project will also provide sub-grants to all municipal corporations in Punjab to fund essential non-medical interventions that respond to the impacts of the COVID-19 crisis and to improve their disaster preparedness.

The $ 105 million loans from the International Bank for Reconstruction and Development (IBRD) have a final maturity of 12.5 years, including a grace period of three years.

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