NATIONAL 6 -(Spotlight Weekly)]

In The Pipeline

Following the approval of a loan by the Manila-based Agriculture Development Bank, the ambitious project is all set to become reality

By A CORRESPONDENT

Come 2006, the thirsty residents of Kathmandu valley will have safe and clean water flowing down their taps round the clock -- provided they can afford it. With the approval of a loan package of US$ 120 million for the ambitious Melamchi Water Supply Project (MWSP) in Manila on December 21, the much-talked about project seems to be heading toward becoming a reality.

Upon its completion in 2006, the project will divert 170 million liters of water daily from the Melamchi River into Kathmandu valley through a 26-km long tunnel. "The construction of the tunnel, however, will not kick off unless the government fulfils its promise of handing over the management of state-owned Nepal Water Supply Corporation to private operators," said resident representative of the Bank in Kathmandu, Dr. Richard Vokes.

The project comprises a water treatment plant and a bulk water distribution system. Out of the total project cost of an estimated US$ 464 million, the ADB and Nepalese government have agreed to finance about a quarter of the cost each. Other financiers include the World Bank, the Japan Bank for International Cooperation, the Norwegian and Swedish aid agencies, the Nordic Development Fund, the OPEC Fund and the government of Japan.

The tunnel will be built to accommodate expanded flows when additional water is diverted from the Yangri and Larke rivers. The project will also construct a water treatment plant with an initial capacity of 170 MLD (million liters a day), capable of being expanded threefold. A bulk water distribution system will be built under the project and existing primary, secondary and tertiary distribution networks will be rehabilitated. Access roads to project facilities will be built and will serve also as farm-to-market roads.

"The project will relieve the acute and widespread distress caused by a chronic lack of safe water. It will also address the institutional challenges to provide water and wastewater management services on a sustainable basis," said Arthur McIntosh, ADB's mission leader for the project.

A social program will help some 40,000 people who will be affected by the project. Facilities to improve living conditions for the people in the project area will include buffer zone development, rural electrification, health and education amenities and income generating community development. These will be maintained through a water levy paid by consumers in Kathmandu Valley for the benefit of the people of Melamchi Valley.

The ADB loan will be from its concessional Asian Development Fund which is repayable over 32 years, including an eight-year grace period. Interest will be one percent per annum during the grace period and 1.5 percent a year thereafter. With this, the ADB's lending for Nepal in 2000 will total $ 173 million for four loans along with $ 5.5 million in technical assistance.

The bank has also agreed to provide a loan assistance of US$ 35 million (approximately Rs 2588.2 million) to Nepal for the implementation of Small Town Water Supply and Sanitation project. The project aims at improving the water supply and sanitation conditions of up to 50 small towns benefiting about 600,000 people. Finance Secretary Bimal Koirala and ADB country representative Vokes signed an agreement to this effect at the Finance Ministry here last week

Official statistics in 1996 revealed that less than 35 per cent of the people residing in urban centers other than Kathmandu have access to piped water supply. Sanitation-related diseases account for 72 per cent of total ailments and diarrhea continues to be one of the leading causes of childhood deaths in Nepal. The ADB will finance 65 per cent of the project cost of US$53.9 million while government, local governments and the beneficiaries will fund the remainder.

The Ministry of Physical Planning and Works will be the executing agency of the project scheduled to be completed in December 2006.