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Press Releases

NR/2000-65
March 30, 2001

Overseas Economic Cooperation Operation

JBIC SIGNS ODA LOAN TO PROVIDE SAFE DRINKING WATER IN NEPAL
-- To Secure Safe Drinking Water and Improve Public Hygiene --

  • 1. Japan Bank for International Cooperation (JBIC; Governor: Hiroshi Yasuda) signed today at its Tokyo head office an ODA loan agreement totaling 5,494 million yen to finance the Melamch Water Supply Project in the Kingdom of Nepal. This brings the cumulative ODA loan commitments by JBIC to the country to nine, totaling 63,529 million yen.
  • 2. The project will finance civil works and procurement of goods and equipment related to construction of a water treatment plant necessary to secure a new water source to supply drinking water to Kathmandu, the capital of Nepal.
  • 3. The percentage of the Nepalese population with access to water supply stood at 61% as of 1997. However, compared to the rural area, where the access has greatly increased, the urban area is lagging behind and unable to meet the rapidly increasing water demand brought about by the significantly accelerated population inflow since the 1980s. The population has been consistently on the rise since the 1960s in the Kathmandu Valley in particular, where the capital city is located. This has created a widening gap between the supply and demand of water. To close this gap, a new source of water supply must be developed. Water resources within the Kathmandu Valley, however, have been almost exhaustively developed. In addition, except for the upstream of a river on the northeastern edge of the Valley, it is extremely difficult both technically and economically to divert water from rivers running through the surrounding regions to the Kathmandu Valley which is situated at an altitude of 1,200 meters. As a result, diversion from the northeastern upstream part of the river is the only option available.
  • 4. Therefore, the project will construct a water treatment plant, and an intake and sluice that are necessary to take water from the Melamch River on the northeastern edge of the Valley and divert it to Kathmandu City. It aims to address the deteriorating water supply situation caused by growing population in the urban areas of the Valley and improve the living conditions of residents. The project is expected not only to improve the water supply and public hygiene in the Kathmandu Valley, but bolster the country's tourism sector by developing a basic infrastructure as well.

(See Appendix for details.)

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