Uzbekistan: Tashkent Province Sewerage Improvement Project

Water and other urban infrastructure and services / Other urban services - Urban hazardous waste management - Urban policy, institutional and capacity development - Urban sanitation - Urban sewerage - Urban water supply

The project takes an integrated approach to improving the access to and reliability of water supply and sanitation (WSS) services in Tashkent Province; and will strengthen climate resilience, gender equality, and environmental sustainability for a green and inclusive recovery after the coronavirus disease (COVID-19) pandemic. It will achieve this by (i) enhancing sewerage coverage in cities; (ii) improving decentralized sanitation in rural areas; (iii) installing production and consumption water meters; (iv) supporting comprehensive capacity building of the Tashkent Suvtaminot (TST), the provincial WSS utility; (v) preventing the spread of COVID-19 through gender-friendly awareness campaigns for water, sanitation, hygiene, and health (WASH+H) measures; and (vi) engaging civil society for broad citizen participation.

The project will develop an integrated wastewater management system in six cities, one urban center, and 70 rural settlements in three districts in Tashkent Province. It will provide inclusive access to centralized sewerage to more than 800,000 people in urban areas, and access to decentralized sanitation systems to 136,000 people in rural areas. The project will also help establish TST as a model utility for replication in other provinces.

Macroeconomic situation and COVID-19 recovery. Uzbekistan is a lower middle-income country and one of Central Asia's fastest-growing economies, achieving a consistent annual growth rate of 4% 6%, with real gross domestic product (GDP) increasing from 4.4% in 2017 to 5.4% in 2018 and expanding to 5.8% in 2019. The Government of Uzbekistan is undertaking structural reforms focused on economic diversification, attracting foreign direct investment, and balancing urban and rural development. While GDP growth in 2020 decreased sharply to 1.6% because of COVID-19 impacts, it is projected to increase by 5.0% in 2021 and 5.3% in 2022. About 448,000 or 1.3% of the population are estimated to have fallen into poverty because of the COVID-19 crisis, despite the government's substantial measures to boost health spending and support households and firms. The crisis is worsening because of limited WSS services and unsanitary conditions.

Investment in WSS services is an essential part of the government's development and COVID-19 recovery strategy. Less than 20% of the population has access to adequate WSS services, and the country has an estimated WSS infrastructure deficit of $2.9 billion. Despite recent investments by international financial institutions, large gaps remain to be able to upgrade the country's legacy WSS infrastructure. This has resulted in environmental and public health risks undermining livability and constraining the country's economic potential.

Project area. Tashkent Province is the country' economic engine, generating almost 25% of the country's GDP. It is the largest urban agglomeration, with 3.1 million people spread across 7 cities, 14 districts, 97 semi-urbanized settlements, and 885 rural villages.

Key issues. Despite its strong economic potential, Tashkent Province is hindered by pervasive limitations in sanitation coverage and services, aggravated by an increasing urban population. Only 17% of the province's population is connected to sewerage systems, while the remaining 83% rely on pit latrines and earth ditches practices that threaten public health and environmental quality. Sewerage system in urban areas has not expanded since 1991, resulting in service coverage of only 35%. The wastewater treatment plants (WWTPs) and networks are no longer functional. Rural settlements have no wastewater services. As a result, massive quantities of untreated wastewater (up to 80% of the total volume) are discharged to the environment. Water quality in the province is deteriorating, and pollution levels exceed national standards. This is compounded by the decline in river flows caused by climate change. In addition, the expected rise in temperature will increase stress on materials and biological treatments. Key issues include limited operation and maintenance (O&M) capacity, an unattractive environment for private sector participation, and low metering and tariff levels. Water supply losses, estimated at 38%, are difficult to verify because of limited water metering. The wastewater tariff is below cost recovery levels, hindering O&M and service delivery.

Institutional performance and reforms. Since its reorganization in 2016, TST and its 2,770 staff serving about 340,600 water supply and 170,000 sewerage connections have implemented a series of reforms addressing critical needs. Two ongoing water supply projects financed by the Asian Development Bank (ADB) have helped support these reforms in the province. These include consolidated smaller water supply systems, strengthened public accountability, modernized management systems, expanded coverage, increased tariffs, and improved staffing. However, TST's operational performance still lags in corporate management, customer service standards, industrial sewer inspection, nonrevenue water management, outsourcing contracts, and wastewater management. Smart water management solutions, such as information and communication technology, geographic information systems, smart water metering, supervisory control and data acquisition systems, and geographic information system-based data for asset management and O&M, will improve its operational capacity. A clear institutional road map is needed to guide TST's medium- to long-term corporate development for optimal and sustainable service delivery to customers.

In November 2019, the government formed a national water agency Uzsuvtaminot Joint Stock Company (UJSC) to strengthen WSS. The suvokovas (provincial utilities), including TST, under the Ministry of Housing and Communal Services, have been transferred to UJSC. This reform is expected to enable private sector participation and improve efficiencies. UJSC is the parent company for all suvokovas, responsible for tariff collection, sector planning, and the construction and modernization of the national drinking water supply and sewerage system. It is also the executing agency for all WSS projects financed by international institutions. This is expected to improve the performance of ADB-funded projects because of its strong coordination with suvokovas. The ADB project coordination unit (PCU), which implements ongoing ADB financed projects, has been transferred to UJSC management.

ADB's phased investment approach in Tashkent Province. ADB is implementing two WSS improvement projects in the province (footnote 9). The first, approved in 2016, aims to increase access to piped drinking water from 20% of the rural population in two districts to 100% by 2023. The second, approved in 2019, aims to (i) expand water supply for rural populations from less than 20% to 100% in two more districts, and (ii) address rural sanitation needs by providing septic tanks in selected rural settlements. The project will complement these ongoing projects to fill essential sanitation infrastructure and service gaps and to strengthen TST's institutional capacity in WSS services.

Strategic alignment. The project is aligned with Uzbekistan's national development strategy, 2017 2021 for inclusive and sustainable growth and access to basic urban services. It also supports government decrees on WSS and ADB's Water Operational Plan, 2011 2020. The project is in line with ADB's country partnership strategy for Uzbekistan, 2019 2023, which aims to bridge the gap between rural and urban development. It is also aligned with ADB's Strategy 2030 operational priorities.

Development partner coordination. ADB is the lead WSS development partner in Uzbekistan. The World Bank and the Swiss Agency for Development and Cooperation are involved in WSS projects in Tashkent Province. The Agence Fran aise de D veloppement, the Asian Infrastructure Investment Bank, and the Islamic Development Bank are also involved in WSS. Close coordination in sector investments and policy dialogue is regularly practiced.

Lessons. Key lessons from ongoing and past ADB-financed WSS projects in the country include the need for (i) engaging the private sector in O&M with transfer of skills, (ii) providing institutional capacity support for sustainability, (iii) installing sewer connections, (iv) achieving high procurement readiness using project readiness financing, and (v) encouraging long-term policy dialogue and partnership for strategic investments to achieve sustainable outcomes.

Inclusive urban and rural sanitation systems with climate-resilient features developed

1a. Centralized urban wastewater systems in the six cities of Akhangaran, Almalyk, Angren, Bekabod, Chirchik, and Yangiyul, and Chinaz urban center improved

1b. Decentralized wastewater systems in 70 rural settlements in Chinaz, Yangiyul, and Zangiota districts established

Institutional capacity for sustainable sanitation services delivery strengthened

Advanced contracting for two packages for the rehabilitation and expansion of WWTPs in project cites is approved.

The procurement will be undertaken in accordance with the ADB's Procurement Policy (2017, as amended from time to time) and Procurement Regulation for ADB Borrowers (2017, as amended from time to time).