The proposed Khyber Pakhtunkhwa Cities Improvement Project will help provincial and city governments to improve the livability of cities by (i) making physical investments in water, sanitation, solid waste disposal infrastructure, and green urban space; and (ii) providing institutional support to improve service delivery and the performance of municipal companies. The project will benefit about 11 million people in the five target districts (2017 population, by 2035 the urban population in these target districts is projected to increase to around 11.0 million) and will support the governments development priorities, established in (i) the National Water Policy (2018), (ii) the Local Government Act (2019), and (iii) Pakistan Vision 2025.
|Project Name||Khyber Pakhtunkhwa Cities Improvement Project|
|Project Type / Modality of Assistance||Loan
|Source of Funding / Amount||
|Strategic Agendas||Environmentally sustainable growth
Inclusive economic growth
|Drivers of Change||Gender Equity and Mainstreaming
Governance and capacity development
Private sector development
|Sector / Subsector||
Water and other urban infrastructure and services / Other urban services - Urban flood protection - Urban policy, institutional and capacity development - Urban sewerage - Urban water supply
|Gender Equity and Mainstreaming||Effective gender mainstreaming|
|Description||The proposed Khyber Pakhtunkhwa Cities Improvement Project will help provincial and city governments to improve the livability of cities by (i) making physical investments in water, sanitation, solid waste disposal infrastructure, and green urban space; and (ii) providing institutional support to improve service delivery and the performance of municipal companies. The project will benefit about 11 million people in the five target districts (2017 population, by 2035 the urban population in these target districts is projected to increase to around 11.0 million) and will support the governments development priorities, established in (i) the National Water Policy (2018), (ii) the Local Government Act (2019), and (iii) Pakistan Vision 2025.|
|Project Rationale and Linkage to Country/Regional Strategy||
In July 2018, Pakistan elected a new government. Its development priorities emphasize providing access to safe water and sanitation, and a healthy living environment for all. The population in Khyber Pakhtunkhwa Province (KPK) is expected to grow from 35 million people in 2017 to about 58 million people by 2035. By 2035, it is estimated that 27.3% of the population of Khyber Pakhtunkhwa Province (KPK) will be concentrated in cities, up from 16.5% in 2017. The rapid growth rate of urban populations in KPK (approximately 3.4% per) is placing tremendous strain on its cities. Inadequate infrastructure and limited capacity to manage municipal water, sanitation services, and solid waste management (SWM) are creating major health risks for the population, and threaten the resilience of cities to the effects of climate change.
Urban development in KPK has been characterized by unplanned sprawl rather than densification. Suboptimal use of space has contributed to resource inefficiency and the inability of infrastructure development to keep pace with population growth. Piped water reaches only 42% of the urban population, and typically for only 6 hours a day. Poor maintenance and leakages contribute to significant losses in piped water networks and contamination of the water supply. In 2014, 75% of supplied water in Abbottabad was unsafe for consumption, and in 2015, water loss in Peshawar was estimated at 67%. Operational sewerage systems serve less than 5% of urban areas, and where networks exist, they are poorly maintained and prone to overflow. Most wastewater moves via open drains, and there are no functional wastewater treatment plants in KPK. Wastewater and sewage are discharged, untreated, into surface water drains or agricultural land. Where they are used for agricultural irrigation purposes which poses a significant health risk to the local farmers and communities. Solid waste management in KPK is also poor due to lack of proper infrastructure, equipment, and technical capacity. Less than 30% of municipal solid waste is collected at all, and uncollected waste is typically burned, disposed of in drains, or used to fill low-lying land. Furthermore, since there are no large-scale sanitary landfills or incineration systems, collected waste is disposed of in open dumps, which lack controls to mitigate polluting the surrounding environment. The overall green space allocation is 3.5%, which is below the recommended international norm of 15-20%.
The Government of Khyber Pakhtunkhwa (GOKP) is promoting the decentralization and corporatization of municipal services. In 2015, the GOKP established seven independent utility companies to take over water supply, wastewater, and solid waste management from local government institutions in the seven administrative districts of KPK. The water and sanitation services companies (WSSCs) are contracted under asset management arrangements and have begun introducing reforms to improve the operations of municipal services. They have publicly disclosed their corporate decisions and operational performance to enhance transparency and accountability. However, the WSSCs are a relatively new initiative in KPK and the companies still lack enough financial, technical, and physical resources they need to optimize their operational effectiveness. Current tariffs are too low to fully recover costs, and although the government provides subsidies, the total revenue collected by the WSSCs is insufficient to maintain existing assets, let alone invest in new ones. Furthermore, the WSSCs lack technical capacity in operations and maintenance, and in planning and implementing new projects. These constraints, paired with the lack of water and sanitation infrastructure, impair current operations and will become more severe as urban populations increase. Overall, the WSSCs need support to (i) reform tariffs to encourage cost recovery for operations and maintenance; (ii) improve operational effectiveness and commercial performance; (iii) develop sustainable business models and identify new opportunities for PPPs; and (iv) strengthen capacity in the areas of planning, budgeting, resource allocation, and human resources management.
The project will finance physical investments in urban infrastructure and capacity building for WSSCs in five KPK cities, including Abbottabad, Kohat, Mardan, Mingora, and Peshawar. All five cities are (i) divisional capitals in KPK, within the top ten most populous cities of KPK, and have a functioning WSSC in place. Mardan and Peshawar are two of the largest cities in KPK, and drive its economy as central hubs for trade, services, and industry. Abbottabad is a tourist and educational center of KPK, located on the Peoples Republic of China-Pakistan Economic Corridor. Kohat is a major node along the N-55 Indus Highway that connects Peshawar to Karachi and the N-80 highway that connects Kohat to Islamabad. Mingora was one of the most popular tourist destinations in Pakistan until security concerns slowed the industry. As the security situations recently improves and tourism recovers, there is a growing need to fill the infrastructure investments gaps in Mingora. The five target cities have good track records in implementing urban projects with development partners such as the Japan International Cooperation Agency and the United States Agency for International Development. During the implementation of the ongoing project readiness financing (PRF), additional cities may be included upon agreement between ADB and the government.
|Impact||Impact of the Project is improved livability and community health for environmental sustainability, and socio-economic development in urban areas of Khyber Pakhtunkhwa Province Pakistan.|
|Outcome||By 2026, Residents in the five Khyber Pakhtunkhwa Province cities have improved access to sufficient, safe and affordable water sanitation, and hygiene services for health and livelihoods.|
Urban infrastructure and public spaces improved and expanded.
Institutional capacities of urban service providers, provincial government, and city governments strengthened.
|Geographical Location||Nation-wide, Khyber Pakhtunkhwa|
|Summary of Environmental and Social Aspects|
|Environmental Aspects||Safeguard due diligence assessment will be completed in late July 2020.|
|Involuntary Resettlement||Safeguard due diligence assessment will be completed in late July 2020.|
|Indigenous Peoples||Safeguard due diligence assessment will be completed in late July 2020.|
|Stakeholder Communication, Participation, and Consultation|
|During Project Design|
|During Project Implementation|
|Responsible ADB Officer||Nakamitsu, Kiyoshi|
|Responsible ADB Department||Central and West Asia Department|
|Responsible ADB Division||Urban Development and Water Division, CWRD|
Local Gov't, Elections and Rural Dev. Dept
Peshawar, Pakistan Planning & Dev.Dept.,Gov't of Khyber Pakhtunkhwa
|Concept Clearance||26 May 2020|
|Fact Finding||05 Apr 2021 to 12 Apr 2021|
|MRM||11 May 2021|
|Last Review Mission||-|
|Last PDS Update||27 May 2020|
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|Title||Document Type||Document Date|
|Khyber Pakhtunkhwa Cities Improvement Project: Initial Poverty and Social Analysis||Initial Poverty and Social Analysis||May 2020|
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
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