The Asian Development Bank (ADB) has approved a $100 million policy-based loan to support Sri Lanka’s water supply and sanitation sector reforms, aiming to enhance the country’s resilience to climate change and promote long-term sustainability.
The Water Supply and Sanitation Reform Program, comprising two subprograms of $100 million each, aims to improve the resilience and sustainability of water supply and sanitation services. Subprogram 1 focuses on establishing national policies and strategies for the National Water Supply and Drainage Board (NWSDB), while Subprogram 2 will support the implementation of reform actions and guidelines.
“Efficient delivery of safe and reliable water supply in Sri Lanka is limited by fragmented water resources management and exacerbated by climate change. This significantly affects the daily life of Sri Lankans—many of whom do not have access to piped water supply,” said Pedro Almeida, ADB Senior Urban Development Specialist. “This program will not only strengthen mechanisms to ensure adequate access to safe water but also address governance and sustainability challenges of the sector, enabling private sector participation.”
Water resources management in Sri Lanka faces longstanding issues, including unbalanced allocation between agriculture and drinking water, inadequate consideration of climate change in planning, involvement of multiple agencies at the national and regional levels, and impacts from unplanned land use and deforestation.
To address these challenges, Subprogram 1 supports the National Water Resources Policy approved by the Prime Minister’s Office, which aims to ensure equitable water allocation and sharing. It also promotes national policies to ensure access to safe drinking water, gender-sensitive and inclusive water service delivery, and a climate change roadmap.
Subprogram 1 is also enhancing sector efficiency through the Ministry of Water Supply and Estate Infrastructure Development’s (MWS) approval of a climate-resilient project appraisal framework for investments in drinking water, and by improving NWSDB’s financial sustainability, efficiency, and performance through roadmaps for public-private partnerships and a business efficiency action plan.
The program includes an $800,000 technical assistance grant to provide capacity and advisory support to MWS and NWSDB for the formulation, implementation, and monitoring of reform initiatives in the next subprogram. ADB’s Technical Assistance Special Fund will cover $500,000 of the amount, while the Water Innovation Trust Fund under the Water Financing Partnership Facility administered by ADB will finance $300,000.
Source: ADB
