ADB approves USD 150 mn loan for Nepal's urban development

The Asian Development Bank has sanctioned a USD 150 million soft loan for Nepal to improve urban infrastructures in the southern area of the country.
The ADB's Board of Directors approved the loan to help improve the delivery of urban services and infrastructure in eight municipalities in the southern Nepal, including in the Terai region.
The project will help them become more sustainable, inclusive and resilient places to live in for more than 1.5 million people, according to a statement issued by ADB Nepal Resident Mission.
"Improving urban infrastructure and service delivery in major urban areas in Nepal, including in the Terai region, is a must given their importance to the country's economy and development," observed Vivian Castro-Wooldridge, an ADB Urban Development Specialist.

"Toward these aims, the project will ensure that people in the southern parts of Nepal are living in areas that are safe, sustainable, inclusive, and resilient to climate change."
Urbanisation in Nepal has been growing at a rapid pace at about 6 per cent since the 1970s, however, this has not contributed significantly to inclusive economic growth due to inadequate urban planning, weak institutions, neglected operations and maintenance of existing urban infrastructures, the ADB said.

"To address this issue, it is estimated that the government would need to double its spending on urban infrastructure to meet the backlog of future demand up to 2030 worth USD 24.5 billion."

"The project will enhance urban infrastructure in municipalities in the Terai region, incorporating climate- resilient and sustainable features, reducing flooding duration to less than an hour in eight municipalities, according to the ADB.
The project will also support a project development facility for the preparation of a pipeline of urban infrastructure projects, particularly in solid waste management, drainage, roads, water supply and sanitation.