Thursday, September 7 2006 12:28 Hrs (IST) - World Time -

Washington: The World Bank has approved a $120 million credit to the Indian state of Uttaranchal to improve the effectiveness of rural water supply and sanitation services through decentralization and an increased role of local governments and communities.

The Uttaranchal Rural Water Supply and Sanitation Project aims to upgrade areas with no or partial coverage of water supply to full coverage with sustainable service, benefiting at least 1.2 million people, or 20 percent of the rural population. The project will also improve sanitation in about 30 percent of rural communities.

"Water-related diseases are a major health problem for the rural population in Uttaranchal, particularly for infants and children," said Fayez Omar, Acting World Bank Country Director for India.

"This project will generate sustainable access to water and sanitation services, which in turn will help reduce water-borne diseases in underserved rural areas," he said.

The Uttaranchal state has a population of 8.48 million, of which 75 percent live in the rural areas. Only half the state is estimated to be fully covered with functioning water supply schemes. In addition, the state faces severe water shortages.

Nearly 30 percent of the schemes suffer from a decrease in the availability of water, especially during the summer months, because of depletion of water sources. This causes some of the villagers to spend one to three hours per day collecting water for domestic use.

The Government of India has developed the Swajaldhara guidelines, which spell out the basic principles for reform in the sector. This includes community participation in the planning, implementation, operation, and maintenance for the schemes of its choice.

"Present rural water and sanitation service delivery does not adequately serve the requirements of user communities as they are often located at sites and deliver services without consideration of community needs or preference," said Smita Misra, World Bank Senior Economist and project leader.

"Under this project, rural local governments in partnership with rural communities, will plan, design, construct, operate, and maintain their water supply and sanitation schemes.

This is the first such project supporting state sector wide common policies and institutional arrangements for improving service delivery. "We hope demonstrated success in Uttaranchal will contribute to replication of such models in other states," said Misra.

The Government of Uttaranchal has prioritised rural water supply and sanitation as a key area of its development agenda in its Tenth Plan (2003-07). It envisages universal coverage of safe and potable water and sanitation by 2012.

This project will support the state's sector reform process by establishing and enhancing its institutional capacity to implement, manage, and sustain the state's sector development programme.

The credit from the International Development Association, the World Bank's concessionary lending arm, carries a 0.75 service fee, a 10-year grace period, and a maturity of 35 years.