Project Concept
STIUEIP, is an urban environmental improvement project being implemented by loan assistance from the Asian Development Bank (ADB). The basic concept of STIUEIP is implementing basic utility infrastructure of the municipality to improve quality of life of people land Environment improvement through drainage, sewer, waste water treatment, integrated solid waste management with affordable and sustainable operation and maintenance.The Ministry of Urban Development is the Executing Agency (EA), working through its Department of UrbanDevelopment and Building Construction (DUDBC), which has established a project coordination office (PCO) for the Project headed by project director. Biratnagar, Birgunj, Butwal and Kavre Valley is the Implementing Agency (IA) for the Project. Project Implementation Unit (PIU) headed by Project Manager is established under the umbrella of the municipalities. Town Development fund (TDF) is one of the key stakeholders to provide loan to Municipality received from GoN and pay back to GoN after recovery from Municipality.
Project Objectives
The main objective of STIUEIP is to improve the quality of life in key regional centers in Nepal and help to achieve higher and more socially inclusive economic growth in those centers through effective, efficient, and reliable delivery of improved and affordable municipal services by accountable project municipalities. The Project is implementing urban environmental improvement, on an integrated basis, in the areas including sewerage and drainage, solid waste, and urban roads and lanes in Biratnagar, Birgunj and Butwal municipalities. In addition, a water supply development sub-project in Kavre Valley is being implemented. Community development Programme including awareness-raising on health and hygiene and 3R (reduce, reuse, and recycle), and investment in small-scale community facilities will be carried out. The Project also strengthens capacity of municipalities and the central Government for project management and operation.
Financing Modality
The total fund allocated in this project is US $106 Million ( TDF -received US$ 12.1 Million as a soft loan at an interest rate of 2.5% and make investment at 5% in the selected municipal projects. The project development under STIUEIP is the responsibility of the PIU of the concerned municipalities under the PCO established in DUDBC. Different financing modality has been adopted according to the scope of project and affordability of people and municipality for sustainable infrastructure investment, operation and maintenance. Accordingly, 81%-84% grant has been provided by GoN,8%-11% loan from TDF at the interest rate of 5% with grace period of 5 years and 15 years of loan payback period. Where remaining 8% will be contribution from municipality.
Status of Project
Under this project TDF has approved NPR 1,304.6 million for 6 different projects and has disbursed NPR 1,053.7 million out of total approved amount. As per the financing agreement, project period has been completed at December end 2020.
