The Asian Development Bank (ADB) has given the green light for a $400 million loan to India with a specific aim: to support urban improvements. This loan is meant to enhance the quality of infrastructure, ensure better public services, and establish more efficient governance systems, according to a statement from the multilateral development bank.
This funding falls under ADB’s Sustainable Urban Development and Service Delivery Program’s Subprogram 2. It is designed to back investments and reforms at the state and urban local body (ULB) levels. The idea is to help India’s cities grow and develop as centers of economic activity. The goal is to create livable cities with inclusive, resilient, and sustainable infrastructure, aligning with ADB Strategy 2030.
“India has recognized the potential for cities to be centres of economic growth and has emphasized the need to make cities livable through inclusive, resilient, and sustainable infrastructure, which is also in line with ADB Strategy 2030,” said Sanjay Joshi, ADB’s principal urban development specialist.
“The national flagship program of Atal Mission for Rejuvenation and Urban Transformation (AMRUT) 2.0 is targeted for universal access of water supply and sanitation and to ensure urban water security through reducing water losses, recycling treated sewage for non-domestic use, rejuvenation of water bodies, and maintaining sustainable groundwater levels,” Joshi added. This mission, approved by the government led by Prime Minister Narendra Modi’s Bharatiya Janta Party (BJP) last October, is focused on making Indian cities ‘water secure’ by offering affordable water and sanitation services and advancing functional tap connections across households, along with an emphasis on water conservation.
“The program also envisages integrated urban planning reforms to control urban sprawls and foster systemic and planned urbanisation through enhancing the entire ecosystem of legal, regulatory, and institutional reforms along with capacity building of ULBs and community awareness,” the ADB statement said. “Specifically, ULBs will promote modernisation of building bylaws, land pooling, an urban agglomeration, and comprehensive urban mobility planning through transit-oriented development to help cities become well-planned centres of economic growth,” it added.
ADB anticipates that these measures will make cities credit-worthy by enhancing revenue through reforms like property taxes and user charges, which will improve efficiency and rationalize expenses. This will enable cities to secure innovative financing options such as commercial borrowings, municipal bond issuance, sub-sovereign debts, and public-private partnerships to bridge the significant deficit in urban infrastructure investments.” ADB will continue to provide knowledge and advisory support to the Ministry of Housing and Urban Affairs in program implementation, including monitoring and evaluation,” the ADB said. The bank will focus on lower-income states, which require support in capacity building, institutional strengthening, and policy reforms, it added.
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