The Asian Development Bank is helping Nepal provide quality water and sanitation services in small towns. The project is benefiting over 1.2 million people in 69 towns with construction and upgrades of water pipes, treatment facilities and household connections, as well as septic tanks, drainage and public awareness campaigns. The third stage project is targeting infrastructure improvements in 26 towns.
| Project Name | Third Small Towns Water Supply and Sanitation Sector Project | ||||||||||||
| Project Number | 35173-013 | ||||||||||||
| Country | Nepal |
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| Project Status | Active | ||||||||||||
| Project Type / Modality of Assistance | Grant Loan |
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| Source of Funding / Amount |
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| Strategic Agendas | Environmentally sustainable growth Inclusive economic growth |
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| Drivers of Change | Gender Equity and Mainstreaming Governance and capacity development Partnerships |
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| Sector / Subsector | Water and other urban infrastructure and services / Urban policy, institutional and capacity development - Urban sanitation - Urban water supply |
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| Gender Equity and Mainstreaming | Gender equity | ||||||||||||
| Description | ADB and the Government of Nepal are working together to provide water supply and sanitation services to selected small towns in the country. The Third Small Town Water Supply and Sanitation Sector Project is providing the services to small towns with a population of 5,000 to 40,000 that show the potential for growth by having access to roads, power supply and telecommunications. This includes the upgrade or construction of water supply systems in up to 20 small towns, involving 1,450 kilometers of water supply pipelines; 67,500 household connections; and 20 water treatment systems with an estimated capacity of 50,000 cubic meters per day. The project will also provide about 5,000 household toilets with septic tanks, as well as provision of septic management facilities and equipment. Drainage systems and master plans are also prepared in towns with flooding risks. Training is being provided to help local water agencies modernize their operations and manage water rates, and to teach local communities public awareness on water conservation and public hygiene. | ||||||||||||
| Project Rationale and Linkage to Country/Regional Strategy | The urban population of Nepal is growing quickly. While this is an important engine for economic growth, it is also creating environmental hazards and rising urban poverty. Improved infrastructure and government services in cities are needed to address these issues. Most people in the country do not have access to piped water and those who do have it often suffer from intermittent service and poor maintenance. In areas without piped or other water systems, people use natural springs, spouts, or shallow groundwater wells and hand pumps. Many households in the country also lack modern sanitation facilities. This leads to open defecation that contaminates water sources and creates serious public health risks. Each year, more than 13,000 children under 5 years of age die of diarrhea-related diseases. | ||||||||||||
| Impact | Improved living conditions in project towns. | ||||||||||||
| Project Outcome | |
|---|---|
| Description of Outcome | Inclusive, genderfocused, and sustainable WSS service delivery in project towns. |
| Progress Toward Outcome | The implementation of the project is satisfactory. As of 15 October 2020, the project elapsed time is 88% (from approval date) while the physical progress achieved is 92%. Nineteen out of twenty water supply subprojects (towns) have started supplying water to the customers. The project is on track to achieve envisaged project outcomes. There are three physical activities under implementation-- (i) Contract for storm water drainage in Mirchaiya which was awarded in 30 December 2019 and is severely delayed and exacerbated by the current situation (COVID-19 pandemic); (ii) installation of SCADA system in five small towns, which is generally on track and expected to be completed by the contract completion date of 30 December 2020; (iii) contracts for enhancement of functionality in 12 operational small towns where the progress varies from 10% to 55%. However, these activities are beyond the original scope of the project and were considered to utilize the loan savings. A loans/grant review mission was undertaken in October 2020 which has agreed with the government a plan of actions to complete the remaining activities under the project.The implementing agency has resumed the works halted due to lockdown followed by outbreak of covid-19 following a standard operating procedure. Activities envisaged under Grant 0405 are completed and the grant will be closed as planned (in 31 December 2020). The closing dates of both ADB and OFID loans is 31 July 2021 and the project team does not foresee any issues for their smooth closure except if the COVID-19 situation worsens and restricts the resource mobilization. Similarly, the activities under outputs 2 (Strengthened sector policy, regulatory and institutional capacity and service delivery) and 3 (improved project implementation) are generally on track. Implementation of GESI action plan is satisfactory except the livelihood enhancement activities which were planned to start from April through August 2020 but seriously affected due to outbreak of COVID-19.In general, the project is on track to meet the outcome level targets with some already achieved (e.g. people having access to improved water supply and sanitation in the project towns, and institutional and regulatory frameworks strengthened for water user associations). |
| Implementation Progress | |
| Description of Project Outputs | 1. Improved WSS infrastructure. 2. Strengthened sector policy, regulatory and institutional capacity, and service delivery. 3. Improved project implementation. |
| Status of Implementation Progress (Outputs, Activities, and Issues) | Progress Towards Achievement of Output 1 (Improved WS infrastructure): As of 30 September 2020, construction of water supply systems are completed for 19 towns and ongoing in Bidur town project. Likewise, about (i) 2,181.54 kilometers of supply pipelines installed; (ii) 66,632 additional households connected to piped water supply; and (iii) 19 water treatment plants with an estimated capacity of 55,740 m3/day constructed. Similarly, 4,982 households have constructed toilets under output-based aid and 6,609 households received fully subsidized tap connections. Two pilot fecal sludge management plants are now operational. Functionality enhancement works in 23 previously completed small towns is also completed. There are some non-physical activities such as assessment of non-revenue water in project towns, and will be completed by the first quarter of 2021. The project is also implementing (i) installation of SCADA in five selected towns, (ii) a storm water drainage contract in Mirchaiya municipality, and (iii) enhancement of functionality in 12 operational towns from the first, second and third small towns projects. All these three additional activities are beyond the project's original scope and are expected to be completed by Q1-2021, at the latest. Progress Towards Achievement of Output 2 (Strengthened sector policy, regulatory and institutional capacity, and service delivery: An institutional support and service advisory unit (ISSAU) has been established in DWSS headed by a dedicated senior divisional engineer. Six individual consultants since June 2018 supported ISSAU in planning and implementing capacity building activities for WUSCs, carrying out need and gap assessment of WUSCs capacity, preparing business plans of DWSSM, NWSSTC, and a model business plan for utilities, and manuals for NRW reduction, among others. ADB will continue supporting ISSAU through Urban Water Supply and Sanitation Sector Project (Loan 3711) through which a new set of five consultants is being recruited. Tariff guidelines are being prepared by TDF and will be finalized soon. Computerized billing and collection system is being practiced in operational towns. All project towns will adopt this system by the project closing date. Several capacity building activities and trainings were provided to WUSC officials and project beneficiaries. There is participation of 33% of women in WUSC executives committee of all 20 towns. The project has a strategy for inclusion of poor and vulnerable households of the participating towns. It has envisaged provision of free water supply connections to 100% of poor and vulnerable households (HHs) in the Project towns. Similarly, an innovative feature of output based aid for sanitation which provided performance based grants to the households for the construction of individual HH toilets. A total of 4.982 HHs have benefitted from OBA for construction of toilets and about 6,800 HHs have received subsidy towards connection of piped water supply. Progress Towards Achievement of Output 3 (Improved Project Implementation): A Class I Engineer leads the PMO supported by three deputy project directors, engineers, account staff, and sociologist. Most of the staff positions have been fulfilled and there are no critical vacant positions. Two Regional PMOs (RMPOs) are also established one each in eastern and western region. Design review and technical audit consultants are supporting the PMO by providing advisory support in project management. All the consultants are recruited, and all the civil works contracts as outlined in the procurement plan are already awarded. |
| Geographical Location | |
| Safeguard Categories | |
|---|---|
| Environment | B |
| Involuntary Resettlement | B |
| Indigenous Peoples | C |
| Summary of Environmental and Social Aspects | |
|---|---|
| Environmental Aspects | The project is classified as category B for environmental safeguards. Twenty initial environmental examinations (IEEs) with environmental management plans (EMPs) have been prepared for the subprojects in accordance with ADB's Safeguard Policy Statement (2009). The draft IEEs for the sample subprojects concluded that no significant negative impacts are to be expected and that the project will yield a substantial net environmental benefit. Any impacts during construction and operation will be avoided or mitigated through measures outlined in the EMP, which will form part of all bidding documents. Measures used in the sample subprojects include (i) application of sufficient buffer zones between WSS facilities, and use of liners to prevent contamination of water sources; and (ii) locating subprojects outside sensitive areas. An environmental assessment and review framework is prepared to guide environmental assessment of future subprojects. Loan consultants have been supporting the environmental focal of the project management office and its regional counterparts, and field-based EMP Monitors, in managing environmental impacts. Environmental reporting to ADB will be semiannual. |
| Involuntary Resettlement | The project is categorized as B for involuntary resettlement. No permanent land acquisition or physical displacement was found to be required for the sample subprojects in Chandrauta, Charali, and Mahendranagar. The land required for the facilities is mostly provided through negotiated settlement, or is a donation by the community organizations or private landowners, or is government land. Three resettlement plans was prepared for Khalanga (Salyan), Mahendranagar, and Suda town projects. Similarly, due diligence reports were prepared for remaining seventeen towns. No temporary impacts are expected from the construction of water supply pipes. A resettlement framework is prepared for the project to provide guidance in preparing future subprojects or in the event of unidentified involuntary resettlement impacts occurring during project implementation. |
| Indigenous Peoples | The project is categorized as C for impacts on indigenous peoples based on the review of the sample subprojects. An indigenous peoples planning framework (IPPF) is prepared to provide guidance in the remaining project towns, and to ensure that livelihoods, culture, dignity, and territories are not compromised by project activities. However, no any impacts on indigenous people is identified hence no indigenous people's plan is prepared. |
| 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 continuous 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 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 | The project is in line with ADB's water and urban operational plans, and its 2013-2017 country partnership strategy for Nepal, which states that ADB will support (i) improvements in inclusive access to and service levels of WSS in small towns, and (ii) institutional strengthening and capacity building of local governments, service providers, and the Town Development Fund. |
| Business Opportunities | |
|---|---|
| Consulting Services | All consultants will be recruited according to ADB's Guidelines on the Use of Consultants. |
| Procurement | All procurement of goods and works will be undertaken in accordance with ADB's Procurement Guidelines. ADBs Procurement guidelines will also apply to expenditure incurred under OPEC Fund for International Development (OFID) loan. International competitive bidding (ICB) procedures will be used for any civil works contract estimated to cost more than $5 million, and any goods contract estimated to cost more than $500,000, National competitive bidding (NCB) procedures will be used for any civil works contract estimated to cost $5 million or less and any goods contract estimated to cost $500,000 or less. Shopping will be used for any civil works or goods contract estimated to cost less than $100,000. Community participation will be used for civil works and goods contracts estimated to cost less than $10,000. Community participation will be used for very small contracts to be carried out by the local community and contractors or water users' association or local bodies for works such as fencing, preparation of drying beds for sludge, etc. As ADB is administering cofinancing resources for operations financed by the ADF resources, universal procurement will apply to all procurement packages to be financed under this Project. |
| Responsible ADB Officer | Paudel, Shiva Prasad |
| Responsible ADB Department | South Asia Department |
| Responsible ADB Division | Nepal Resident Mission |
| Executing Agencies |
Ministry of Water Supply (formerly Ministry of Water Supply and Sanitation) Singha Durbar |
| Timetable | |
|---|---|
| Concept Clearance | 05 Apr 2013 |
| Fact Finding | 31 Mar 2014 to 11 Apr 2014 |
| MRM | 30 Jun 2014 |
| Approval | 10 Mar 2015 |
| Last Review Mission | - |
| Last PDS Update | 30 Nov 2020 |
Grant 0405-NEP
| Milestones | |||||
|---|---|---|---|---|---|
| Approval | Signing Date | Effectivity Date | Closing | ||
| Original | Revised | Actual | |||
| 19 Sep 2014 | 25 Nov 2014 | 23 Feb 2015 | 30 Jun 2019 | 31 Dec 2020 | - |
| Financing Plan | Grant Utilization | ||||
|---|---|---|---|---|---|
| Total (Amount in US$ million) | Date | ADB | Others | Net Percentage | |
| Project Cost | 1.30 | Cumulative Contract Awards | |||
| ADB | 0.00 | 19 Sep 2014 | 0.00 | 1.19 | 92% |
| Counterpart | 0.00 | Cumulative Disbursements | |||
| Cofinancing | 1.30 | 19 Sep 2014 | 0.00 | 0.89 | 69% |
| Status of Covenants | ||||||
|---|---|---|---|---|---|---|
| Category | Sector | Safeguards | Social | Financial | Economic | Others |
| Rating | Satisfactory | - | - | - | - | - |
Loan 3157-NEP
| Milestones | |||||
|---|---|---|---|---|---|
| Approval | Signing Date | Effectivity Date | Closing | ||
| Original | Revised | Actual | |||
| 19 Sep 2014 | 25 Nov 2014 | 23 Feb 2015 | 31 Jul 2021 | - | - |
| Financing Plan | Loan Utilization | ||||
|---|---|---|---|---|---|
| Total (Amount in US$ million) | Date | ADB | Others | Net Percentage | |
| Project Cost | 87.70 | Cumulative Contract Awards | |||
| ADB | 60.00 | 19 Sep 2014 | 49.46 | 0.00 | 91% |
| Counterpart | 27.70 | Cumulative Disbursements | |||
| Cofinancing | 0.00 | 19 Sep 2014 | 42.83 | 0.00 | 78% |
| Status of Covenants | ||||||
|---|---|---|---|---|---|---|
| Category | Sector | Safeguards | Social | Financial | Economic | Others |
| Rating | Satisfactory | - | - | - | - | - |
Loan 8304-NEP
| Milestones | |||||
|---|---|---|---|---|---|
| Approval | Signing Date | Effectivity Date | Closing | ||
| Original | Revised | Actual | |||
| 10 Mar 2015 | 22 Sep 2015 | 04 Feb 2016 | 28 Feb 2020 | 31 Jul 2021 | - |
| Financing Plan | Loan Utilization | ||||
|---|---|---|---|---|---|
| Total (Amount in US$ million) | Date | ADB | Others | Net Percentage | |
| Project Cost | 20.00 | Cumulative Contract Awards | |||
| ADB | 0.00 | 10 Mar 2015 | 0.00 | 16.67 | 83% |
| Counterpart | 0.00 | Cumulative Disbursements | |||
| Cofinancing | 20.00 | 10 Mar 2015 | 0.00 | 12.93 | 65% |
| Status of Covenants | ||||||
|---|---|---|---|---|---|---|
| Category | Sector | Safeguards | Social | Financial | Economic | Others |
| Rating | Satisfactory | - | - | - | - | - |
Project Data Sheets (PDS) contain summary information on the project or program. Because the PDS is a work in progress, some information may not be included in its initial version but will be added as it becomes available. Information about proposed projects is tentative and indicative.
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The Accountability Mechanism provides a forum where people adversely affected by ADB-assisted projects can voice and seek solutions to their problems and report alleged noncompliance of ADB's operational policies and procedures.
In preparing any country program or strategy, financing any project, or by making any designation of, or reference to, a particular territory or geographic area in this document, the Asian Development Bank does not intend to make any judgments as to the legal or other status of any territory or area.
Safeguard Documents See also: Safeguards
Safeguard documents provided at the time of project/facility approval may also be found in the list of linked documents provided with the Report and Recommendation of the President.
Evaluation Documents See also: Independent Evaluation
None currently available.
Related Publications
The Access to Information Policy (AIP) establishes the disclosure requirements for documents and information ADB produces or requires to be produced in its operations to facilitate stakeholder participation in ADB's decision-making. For more information, refer to the Safeguard Policy Statement, Operations Manual F1, and Operations Manual L3.
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Tenders
Contracts Awarded
| Contract Title | Approval Number | Contract Date | Contractor | Contractor Address | Executing Agency | Contract Description | Total Contract Amount (US$) | Contract Amount Financed by ADB (US$) |
|---|---|---|---|---|---|---|---|---|
| DESIGN, SUPPLY, INSTALLATION AND OPERATION OF SCAD A (TSTWSSSP?ICB-05/SCADA) | Loan 3157 | 31 Dec 2019 | XI'AN/SAISANKET JV | LALITPUR NEPAL | Ministry of Urban Development | CONSTRUCTION | 2,008,717.40 | 1,707,985.71 |
| INDIVIDUAL CONSULTING SERVICES FOR TEAM LEADER/WAT ER SUPPLY & SANITATION UTILITY EXPERT FOR ISSAU | Loan 3157 | 11 Oct 2018 | RAMDEEP SAH | CHABHIL, KATHMANDU NEPAL | Ministry of Urban Development | Consulting Services | 118,807.00 | 100,048.00 |
| CONTRACT FOR CONSTRUCTION AND O&M OF WATER SUPPLY AND SANITATION SUBPROJECT IN KATAHARIYA, RAUTAHAT | Loan 3157 | 11 Dec 2017 | M/S RAMAN-ASHISH JV | MAHARAJGUNJ, KATHMANDU NEPAL | Ministry of Urban Development | CONSTRUCTION | 1,374,031.00 | 1,016,074.00 |
Procurement Plan
| Title | Document Type | Document Date |
|---|---|---|
| Third Small Towns Water Supply and Sanitation Sector Project: Procurement Plan | Procurement Plans | Dec 2020 |