Shimla Water Supply and Sewerage Service Delivery Reform Programmatic Development Policy Loan 1

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The development objective of Shimla Water Supply and Sewerage Service Delivery Reform First Programmatic Development Policy Loan (DPL) Project for India is to support the government of Himachal Pradesh (GoHP) in its policy and institutional development program for improving water supply and sewerage services that are financially sustainable and managed by an accountable institution responsive to its customers. This DPL, the first of three, supports the implementation of the GoHP’s medium-term program for improving Water Supply and Sewerage (WSS) services, starting with the Greater Shimla Area. This marks a departure from the traditional short-term crisis handling approach of the past in Himachal Pradesh’s Water Supply and Sewerage WSS sector. To achieve the Project Development Objective (PDO), the operation supports three key pillars of the government program: (i) Improving governance, managerial and financial autonomy; (ii) Increasing the efficiency of WSS operations; (iii) Increasing customer orientation and accountability, complemented by a cross-cutting capacity building effort. This program is consistent with the World Bank Group’s Country Partnership Framework (CPF) FY18-22. The CPF focuses on a more resource-efficient growth path for India, in which improving living conditions and sustainability of cities through improving water systems is a direct contributor. The program directly contributes to the World Bank Group’s twin goals of ending extreme poverty and promoting shared prosperity. This DPL is supporting public sector reforms, including improving operational and financial sustainability of services through an autonomous and accountable WSS Company and thus strengthening the capacity of Shimla Municipal Corporation (SMC) and GoHP to improve services. This will improve the credit-worthiness of Shimla Jal Prabandhan Nigam Limited (SJPNL) and enhance the chances of future private financing.