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The World Bank has extended a $400-million loan for the Tamil Nadu Sustainable Urban Development Project. The total project size is $600 million.
The loan and project agreements for the International Bank for Reconstruction and Development (IBRD) assistance were signed between the Central Government, Government of Tamil Nadu and the World Bank here.
The objective of the project is to improve urban services in participating Urban Local Bodies (ULBs) in a financially sustainable manner and to pilot improved urban management practices in selected cities. The project has three main components — investment in urban services; result based grants for urban governance and urban sector technical assistance.
As part of investment in urban services, the project will support improvement in range of urban services, including water, sewerage, municipal solid waste, urban transportation, sewerage management and storm water drainage.
The project also envisages creation of a reserve fund to provide credit enhancements for municipal bonds and other market-based loan instruments issued by ULBs. It will provide results-based grants to eligible ULBs to implement new urban-management models that strengthen governance and financial sustainability.
As part of urban sector technical assistance, the project will support strengthening the capacity of ULBs and urban sector officials.
The loan agreement was signed by Raj Kumar, Joint Secretary, Department of Economic Affairs, Ministry of Finance on behalf of the Central Government and Onno Ruhl, Country Director, World Bank on behalf of the World Bank.
The Project Agreements were signed by Praveen P Nair, Deputy Secretary, Municipal Administration and Water Supply Department, Tamil Nadu Government; and Anita Praveen, Principal Secretary/ Chairperson and Managing Director, Tamil Nadu Urban Infrastructure Financing Services Ltd (TNUIFSL); and Onno Ruhl on behalf of the World Bank.
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