India’s Shimla water supply and sewerage service gets $40M World Bank loan

The Government of India, Government of Himachal Pradesh (GoHP) and the World Bank have signed a loan agreement to help bring clean drinking water to the citizens of the Greater Shimla area, who have been facing severe water shortages and water-borne epidemics over the past few years.

With the new $40m Shimla Water Supply and Sewerage Service Delivery Reform Programmatic Development Policy Loan 1 from the International Bank for Reconstruction and Development (IBRD), water supply and sanitation (WSS) services in and around Shimla are expected to improve.

The state government has developed the policy and institutional reform programme for the deployment of systems to improve water supply and sewerage services.

Initially, the state government along with the Shimla Municipal Corporation has set up a dedicated utility, the Shimla Jal Prabandhan Nigam (SJPNL) which will take over WSS services and run the city’s WSS system.

World Bank country director Junaid Ahmad said that the development policy loan (DPL) will help SJPNL orient itself as a customer-focused utility that has the technical capacity and performance-based management policies required to provide reliable drinking water to Shimla.

The latest project will support the GoHP’s programme of policy and institutional reform needed to bring continuous, pressurised water supply.

Additionally, it will bring efficient sewage collection and treatment for all households in the Greater Shimla Area.

Shimla currently has a water supply infrastructure with a capacity of 40 million litres daily (MLD), which is unable to meet the existing demand of 56 MLD.

With the launch of three critical operations to improve WSS services in the state capital, the World Bank DPL will support SJPNL in its policy and institutional reform programme.

The loan has a four-year grace period and maturity of 15.5 years, and will bring bulk drinking water to Shimla from a new source on the Sutlej River. This will provide continuous water supply, sewage management, and sewage services for peri-urban areas.