Asian Development Bank Approves Rs. 17.35 Arba Loan To Improve Water And Sanitation In Nepal

KATHMANDU, June 19 — The Asian Development Bank has approved a $115 million concessional loan, equivalent to around Rs. 17.35 Arba on June 18, 2026 to improve water supply, sanitation services, and urban resilience in Nepal’s rapidly growing municipalities.

The financing will support the Integrated Water Supply and Sewerage Management Project, which is expected to directly benefit more than 8,50,000 people across 13 municipalities. The project will focus on expanding access to safer drinking water, improving sewerage systems, strengthening wastewater treatment, and helping urban areas manage growing pressure on basic services.

According to ADB, rapid urban growth in Nepal has increased pressure on city services, leaving many communities with unreliable water supply and limited sanitation access. ADB Country Director for Nepal Arnaud Cauchois said, "This project will expand access to safe and reliable water and sanitation services, strengthen resilience to natural hazards and disaster risks, and support healthier, more livable, and sustainable cities while promoting economic opportunities and inclusive growth."

Under the project, water supply infrastructure will be expanded through the construction of around 64 tube wells, treatment facilities with a combined capacity of about 60 million liters per day, and nearly 2,125 kilometers of distribution networks. Around 72,000 households, including vulnerable and women-headed households, are expected to receive piped water connections.

The sanitation component will include upgraded sewerage and drainage networks, wastewater treatment plants, and fecal sludge treatment facilities. More than 1,20,000 properties are expected to gain access to improved sanitation services.

The project also includes climate adaptation and mitigation measures supported by $75.27 million (Rs. 11.36 Arba) in dedicated climate financing. It is expected to reduce greenhouse gas emissions by more than 22,000 tons of carbon dioxide equivalent each year.

The total project cost is estimated at $143.8 million (Rs. 21.69 Arba), including $28.8 million (Rs. 4.34 Arba) in counterpart funding from the Government of Nepal. The project will be implemented with support from the Department of Water Supply and Sewerage Management and participating municipalities, and is scheduled for completion by June 2032.