Wednesday, March 15 2006 11:06 Hrs (IST) - World Time -

Washington: The World Bank has approved a $216 million loan to Karnataka to finance the delivery of urban services through enhancing infrastructure and improving the institutional and financial frameworks at the state and local levels.

The Karnataka Municipal Reform Project is designed to support an evolving process of urban reforms with a focus on large-scale restructuring of urban governance and management.

"These reforms are expected to result in the creation of well-governed and functioning cities that are able to finance and deliver basic urban services for the urban poor in a sustainable manner", the Bank has said in a statement.

"Karnataka is one of the most rapidly urbanizing states in India. Its growth in urban population, incomes, and competitive business has created a strong demand for quality services across all urban areas. Infrastructure investments have become an urgent priority for the state, yet the shortfall in meeting the investments need is huge", it said.

"This project will significantly enhance the State's urban services from water supply and sewerage system to urban roads and slum up-gradation," said Michael Carter, World Bank Country Director for India.

"It will also contribute to improved health conditions of the poor by improving access to sanitary services", he added.