India | Poverty​

Raising the Quality of Urban Service Delivery

The Rajasthan Urban Sector Development Program, a partnership among ADB, the Sanitation Financing Partnership Trust Fund supported by the Bill & Melinda Gates Foundation, and the Government of India, showed that physical investments that uplift the lives of the urban poor are better planned if they are combined with policy actions that strengthen institutions that oversee infrastructure and planning.

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Policy for Alleviating Poverty. Sweeping policy actions motivated various stakeholders, including state institutions, municipalities, households, and investors, to work together to improve the quality of urban life in Rajasthan.

Project

Rajasthan Urban Sector Development Program

Project Cost

$613 million

  • ADB $501 million
  • India $110 million
  • Financing Partner
    • Sanitation Financing Partnership Trust Fund under the Water Financing Partnership Facility $2 million

Approval Date

October 2014

Signing Date

11 Sep 2015

Completion

June 2020

Partnership Results

Establishment of Rajasthan Urban Drinking Water, Sewerage, and Infrastructure Corporation
Establishment of Jaipur Water Supply and Sewerage Board

Background

In Rajasthan, India, coverage of piped water supply has increased over the years, but service provision level has been uneven. Only 76% of the population have access to piped water and 60% have access to sanitation services. Those lacking access to or with poor water supply and sanitation are either the poorest or residents of hard-to-reach areas. These aggravate urban poverty in Rajasthan, which hovers around 11% of the population. Although this is lower than the national average, poverty is always a threat in the state. Many live in slums that not only lack water infrastructure, but are crowded, filthy, and prone to disease outbreaks.

Interventions

Many interventions have been done to improve urban infrastructure in Rajasthan. These include two multisector projects since 1999 that showed the importance of looking at policy reforms, on top of building infrastructure, to increase the impact of urban investments. Lessons from these initiatives revealed that government should complement infrastructure with “sustainable and vibrant institutions and effective governance systems to sustain and maximize their impacts.” These lessons informed the Rajasthan Urban Sector Development Program, which boosted public service delivery in Rajasthan.

Approved in October 2014, the program is ADB’s first project that combines a policy loan to support urban sector reforms with a project loan to improve urban services. The policy-based loan led to the creation of a state corporation─the Rajasthan Urban Drinking Water, Sewerage, and Infrastructure Corporation (RUDSICO). As a corporate agency, it is responsible for planning, resource mobilization, and construction of assets financed by multilateral banks or governments. After completion of construction activities, RUDSICO turns over the assets to their corresponding municipal bodies or relevant line departments. This ensures an integrated approach to urban development and reduces overlaps in responsibilities among municipalities and other development authorities.

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The Rajasthan Urban Sector Development Program, a partnership among ADB, Bill and Melinda Gates Foundation and the Government of India, showed that physical investments that uplift the lives of the urban poor are better planned if they are combined with policy actions that strengthen institutions that oversee infrastructure and planning.

The policy-based loan also helped Rajasthan establish a new corporatized entity─the Jaipur Water Supply and Sewerage Board (JWSSB). The JWSSB is an independent utility that manages water supply and sewerage services in Jaipur, the capital of Rajasthan. Before its establishment, water supply and sewage management services were handled by multiple agencies, such as the Jaipur Municipal Corporation, Jaipur Development Authority, the Public Health and Engineering Board, and the Rajasthan Housing Board.

The project’s outcomes were bolstered by a sanitation grant from the Bill & Melinda Gates Foundation (BMGF). The BMGF grant is providing low-income families in the towns of Khandela, Lalsot, and Phulera with innovative sanitation improvements, including septage management. The grant was also used to develop the Fecal Sludge and Septage Management guidelines for urban local bodies in the State, which the government has approved.

Results

By creating a strong institution that can oversee the state’s urban development and equipping it with concrete business and human resources development plans, Rajasthan now has a single body to oversee urban infrastructure projects. This makes it easier for the state to plan and ensure urban sustainability. RUDSICO also includes a technical design center run by experts in managing and implementing urban infrastructure projects. Currently, it is overseeing urban infrastructure projects in 29 cities.

The JWSSB’s creation likewise started the road to improved water supply and sanitation services. The legislation Rajasthan passed to establish its Board ensured that the utility has adequate staff, equipment, and resources. This enables JWSSB to expand water supply and sanitation services across cities and ensure that these services reach the urban poor and slum areas.

The project is still ongoing but with these two institutions in place, urban services in Rajasthan will potentially help the state’s poorest citizens to enjoy improved health, better environment, and higher standards of living. In addition, its project component is nearing completion. It will bring in septage treatments in three towns, improved water distribution networks in five project cities and upgraded sewerage systems in six project cities. Around 762.3 km of the targeted 1,699.7 km of sewers and 1,367.9 km out of the targeted 2,643.3 of water supply pipeline have been laid to date and 63,009 new house service connections have also been provided out of the target 196,006.

This program showcases the importance of policy in addressing urban poverty. Physical investments that uplift the lives of the urban poor are better planned if they are combined with policy actions that strengthen institutions that oversee infrastructure and planning. The approach becomes more holistic and the outcomes, more sustainable. Moreover, stronger institutions and good governance can ensure that the benefits of development reach the poor, which are often left marginalized and vulnerable in the fringes of society, especially in highly urbanized cities.