Project Name Third Small Towns Water Supply and Sanitation Sector Project
Project Number 35173-012
Country / Economy Nepal
Project Status Closed
Project Type / Modality of Assistance Technical Assistance
Source of Funding / Amount
TA 8346-NEP: Third Small Towns Water Supply and Sanitation Sector Project
Technical Assistance Special Fund US$ 800,000.00
Multi-Donor Trust Fund under the Water Financing Partnership Facility US$ 300,000.00
Strategic Agendas Environmentally sustainable growth
Inclusive economic growth
Drivers of Change Gender Equity and Mainstreaming
Governance and capacity development
Sector / Subsector

Water and other urban infrastructure and services / Urban water supply

Gender Effective gender mainstreaming

Following the First and the Second Small Towns Water Supply and Sanitation Sector Projects (the earlier projects), the Third Small Towns Water Supply and Sanitation Sector Project (the project) will support the ongoing efforts of the Government of Nepal (the government) to further improve water supply and sanitation service delivery in small towns in Nepal. The PPTA will leverage the experience gained from the earlier projects, and incorporate lessons learned to prepare for the project. The PPTA will assist the government in amending the Development Plan, preparing cost estimates and financing plan and the feasibility studies of the sample subprojects, with a special focus on structuring and refining the project design, including rationale, modality, appraisal, financing, implementation and institutional arrangements, and developing eligibility and evaluation criteria for future subproject selection in close consultation with the government and ADB. Upon finalizing the project modality, the PPTA will prepare the project, following ADB's due diligence requirements.

Project Rationale and Linkage to Country/Regional Strategy The PPTA for the project is necessary in order to achieve the project outputs, including: (i) improved water supply and sanitation infrastructure; (ii) improved institutional capacity and project implementation platform; and (iii) improved financing mechanism for infrastructure investments. In addition to improved infrastructure, improved institutional capacity and implementation platform together with improved financing mechanism will contribute to the government's long-term agenda in up-scaling investments in the sector, particularly for small towns.


Project Outcome
Description of Outcome


Progress Toward Outcome
Implementation Progress
Description of Project Outputs


Status of Implementation Progress (Outputs, Activities, and Issues)
Geographical Location Nation-wide
Summary of Environmental and Social Aspects
Environmental Aspects
Involuntary Resettlement
Indigenous Peoples
Stakeholder Communication, Participation, and Consultation
During Project Design

Stakeholder participation and communication plan and strategy will be formulated at the initial design stage. The national social safeguard and resettlement specialists under the PPTA will be based in the field office for the sample subproject towns to ensure timely attention to issues concerning participation. For the remaining subproject towns, loan consultant will ensure the compliance with the stakeholder participation and communication plan and strategy by providing quarterly updates to ADB in the progress report.

The main stakeholders of the project are small town residents, local business communities, users' committees, government officials, civil society organizations and development partners. The project design is finalized through a process that involves timely consultation between government and development partners, socio-economic surveys for the residents and business communities and communications with users' committees to determine feasibility of project design.

The PPTA will verify the key civil society organizations in the project area and the level of participation. Information dissemination is envisaged at the town level through billboards, posters and newsletters, where applicable. General orientation and targeted consultation seminars will be held. The beneficiaries will collaborate through the WUSCs to make contributions to establishing the infrastructure through a demand-driven participatory approach.

The project is to provide water supply services in the subproject area. Therefore, determination of the subproject area is important as not to exclude the poor, women-headed and minority households from access to improved services. Consultation with the poor and excluded can be engaged through focus group discussion, interviews and local meetings and can be separately arranged for separate focus groups to maintain appropriate level of sensitivity.

During Project Implementation To be prepared under the PPTA.
Business Opportunities
Consulting Services The PPTA will require 4 positions and 14 person-months of international consulting services and 11 positions and 57 person-months of national consulting services by an international consulting firm in association with national consulting firm(s). ADB will recruit additional two international consultants on individual basis for a total of 5 person-months. ADB will select and engage consultants according to ADB's Guidelines on Use of Consultants (2010, as amended from time to time) and other arrangements satisfactory to ADB for the selection and engagement of consultants. The quality and cost-based selection method, using the quality cost ratio of 90:10 and full technical proposal procedures, will be followed. The quality cost ratio is justified due to (i) the in-depth local knowledge required to prioritize and select multiple subproject towns; (ii) the specific expertise required to conduct financial market and financial institution assessment, financial structuring, market analysis and procurement assessment; and (iii) the comprehensive technical expertise combined with local knowledge to prepare technical feasibility studies and preliminary designs specific for distinct sample subproject towns. The PPTA will address the following aspects relating to the project: (i) assessment of executing agency (EA) and the PMO capacity and preparation of capacity building plan to minimize implementation, procurement and financial management risks; (ii) indicative loan related procurement plan based on procurement capacity assessment; and (iii) indicative implementation schedule with proposed sequencing of consultant recruitment and bidding and awarding of procurement packages.
Responsible ADB Officer Pokhrel, Neeta
Responsible ADB Department South Asia Department
Responsible ADB Division Urban Development and Water Division, SARD
Executing Agencies
Ministry of Urban Development
Concept Clearance -
Fact Finding -
Approval 05 Apr 2013
Last Review Mission -
PDS Creation Date 29 Nov 2005
Last PDS Update 21 May 2013

TA 8346-NEP

Approval Signing Date Effectivity Date Closing
Original Revised Actual
05 Apr 2013 09 May 2013 09 May 2013 31 Dec 2014 31 Dec 2015 31 May 2016
Financing Plan/TA Utilization Cumulative Disbursements
ADB Cofinancing Counterpart Total Date Amount
Gov Beneficiaries Project Sponsor Others
800,000.00 300,000.00 0.00 0.00 0.00 0.00 1,100,000.00 17 Jun 2022 987,585.98
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