World Bank Approves $300 Million Program for Tamil Nadu Urban Development

On December 21, 2023, The World Bank’s Board of Executive Directors approved a new program to support Tamil Nadu’s urban development, aiming to provide around 2 million people with improved access to water and sewerage services in cities. Tamil Nadu, a highly urbanized state in India, has been facing the increasing impacts of climate shocks such as floods and droughts, making access to essential services like water and sanitation crucial for building climate-resilient cities.

Program Details

The $300 million Tamil Nadu Climate Resilient Urban Development Program is set to assist 21 Urban Local Bodies (ULBs) in updating their delivery systems, and providing quality and efficient water supply and sewerage services to consumers. The goal is to strengthen the cities’ ability to cope with the impacts of climate change and ensure the continuity of basic service delivery as the population grows rapidly.

The program also includes plans to increase designated areas for green spaces and parks, leveraging the private sector through performance-based contracts, issuing municipal bonds, and supporting urban governance reforms to improve the fiscal health of ULBs. Women and communities will play a key role in designing and supporting effective climate action plans for cities.

World Bank’s Role

For the past two decades, the World Bank has worked with Tamil Nadu and ULBs to establish and scale-up a state-level urban institution as a public-private partnership facility that leverages various sources of finance for urban infrastructure projects in cities.

Loan Details

The $300 million loan from the International Bank of Reconstruction and Development (IBRD) will use the blended financing instrument of Program-for-Results (PforR) with Investment Project Financing (IPF) to link disbursement of funds directly to the achievement of results while providing technical assistance. The Program loan has a maturity of 32 years with a grace period of 7 years.

Contact Information

If you have any questions regarding the program, you can contact the World Bank representatives in Washington at [email protected] and in Delhi at [email protected].

FAQ

Q: What is the goal of the program?

A: The goal is to strengthen the cities’ ability to cope with the impacts of climate change and ensure the continuity of basic service delivery as the population grows rapidly.

Q: What are the loan details?

A: The $300 million loan from IBRD will use the blended financing instrument of Program-for-Results (PforR) with Investment Project Financing (IPF) to link disbursement of funds directly to the achievement of results while providing technical assistance. The Program loan has a maturity of 32 years with a grace period of 7 years.

Conclusion

The approval of the $300 million program by The World Bank will significantly contribute to the development of climate-resilient urban infrastructure in Tamil Nadu, benefiting around 2 million people. The program’s emphasis on improving water and sewerage services, enhancing green spaces, and supporting urban governance reforms reflects the commitment to building sustainable and resilient cities in the face of climate change challenges.