Announcement of India Set to Improve Water Supply, Sanitation in Hyderabad on March 29, 1990

FOR IMMEDIATE RELEASE 'NorId Bank 1818 H Street, N.W., Washington, D.C. 20433, U.S.A.* Telephone: (202) 477-1234 BAg NEWS RELEASE NO. 90/ 66 Contact: Richard Kollodge IDA NEW RELEASE NO. 90/52 (202) 477-4507 INDIA SET TO IMPROVE WATER SUPPLY, SANITATION IN HYDERABAD WASHINGTON, March 29, 1990 -- More than 3 million people in Hyderabad, India's sixth-largest city, will gain access to a more reliable and safe supply of water and improved sanitation facilities through a project being supported by a loan of $10 million from the World Bank and a credit of SDR 63.9 million ($79.9 million) from the Bank's concessionary lending affiliate, the International Development Association (IDA). Because of periodic droughts and an obsolete water-supply system, many residents of Hyderabad have access to water for only two hours at a time, every other day. The sewerage system in this city in south-central India is also outdated, and untreated sewage flows into nearby irrigation systems and endangers the health of the city's residents. The project is designed to increase the water supply in the city by constructing facilities for transporting, treating and storing water from the Singur Dam Reservoir, which started filling last summer. The project also includes measures for resettling families whose land will be flooded as the reservoir fills completely this summer. The project further includes the repair and upgrading of Hyderabad's sewerage system and construction of several sewage-treatment facilities. A program to build low-cost latrines for the city's poorer residents will also be launched under the project. Technical assistance and training will be provided for staff of the Hyderabad Metropolitan Water Supply and Sewerage Board to help the agency streamline its operations and plan some of the work to be carried out under the project. . The $141 million project is expected to make the water-supply system less vulnerable to drought, reduce groundwater pollution, and improve health - conditions, particularly in poorer neighborhoods. Additional financing for the project will be provided by the Government of Andhra Pradesh ($50 million) and households that will benefit from the low-cost sanitation part of the project ($700,000). -2- The World Bank loan is for 20 years, including five years of grace, with a variable interest rate, currently 7.75 percent, linked to the cost of the Bank's borrowings. It also carries an annual commitment charge of 0.25 percent on the undisbursed balance. The IDA credit is for 35 years, including 10 years of grace; it carries no interest, but has an annual charge of 0.75 percent on the disbursed balance and a variable charge of up to 0.5 percent (currently zero percent) on the undisbursed balance. Note: Money figures are in U.S. dollar equivalents. IDA credits are denominated in SDRs (Special Drawing Rights), which are valued on the basis of a "basket" of currencies. The U.S. dollar equivalent of the SDR amount of the IDA credit reflects the exchange rates existing at the time of the negotiation of the credit.