MANILA, PHILIPPINES - ADB will help provide sustainable access to improved and safe water supply and sanitation services to about 1.6 million people in 16 towns in Bangladesh through a US$41 million loan.
The loan will support the $71.1 million Secondary Towns Water Supply and Sanitation Sector project, which aims to help the Government meet the water-related Millennium Development Goals and its own poverty reduction targets.
While the country has made good progress in increasing access to water supply and sanitation, about 28% of the urban population and 41% of the rural population still do not have access to safe water. With sanitation, only 74% of urban areas and 57% of rural areas are covered.
In around a third of small towns, or pourashavas, limited piped water supply is available for 2-12 hours a day. However, the water often has a high iron and mineral content. The rest of the population generally relies on hand tube wells, ponds, and other sources of doubtful quality. Contamination of water sources is a serious problem in the country, with 22% of its roughly 7 million tube wells contaminated with arsenic beyond the Bangladesh standard of 0.05 milligrams/liter.
"Bangladesh's water sector is at a critical stage," says Nayana Mawilmada, an ADB Urban Specialist. "The Government is placing a strong focus on the development of the water sector in its poverty reduction strategy, which has broad support from funding agencies. Momentum within the sector is significant, and the environment is conducive for change."
The project will rehabilitate, develop and expand water sources, treatment facilities, and piped water supply systems in selected pourashavas, ensuring that only arsenic-free groundwater sources will be used.
To help the Government achieve its 100% sanitation coverage target by 2010, the project will educate communities on the link between proper hygiene and sanitation and health to increase demand for improved sanitation. Community, school, and public latrines will also be constructed.
The project will also help build pourashavas' capacity to operate and manage water supply and sanitation investments, as well as the Department of Public Health Engineering's capacity to oversee the sector and implement the Government's development program for the water and sanitation in Bangladesh.
ADB's loan comes from its concessional Asian Development Fund. It carries a 32-year term, including an 8-year grace period, and an annual interest of 1% during the grace period and 1.5% afterwards.
The OPEC Fund for International Development will provide $9 million for the project, while the balance will be shouldered by the Government, pourashavas, and communities. The Department of Public Health and Engineering is the executing agency for the project, which is due for completion in 2013.