ADB approves $139.55 million to improve Puducherry water supply and municipal services

Urban areas accommodate about 68 percent of Puducherry’s population of 1.8 million, and the Union Territory attracts more than 2.3 million tourists each year.

The Asian Development Bank (ADB) has approved a $139.55 million loan to improve urban services and municipal governance in Puducherry, benefiting more than 320,000 people. The Puducherry Integrated Urban Livability Improvement Project will upgrade water supply and sanitation, improve public spaces and strengthen the municipal government's finances and administrative capacity. The investment addresses pressure on essential services as urban growth, tourism and climate risks place greater demands on the city's infrastructure.

Urban areas accommodate about 68 percent of Puducherry's population of 1.8 million, and the Union Territory attracts more than 2.3 million tourists each year. Unmet demand for municipal services from residents and visitors, combined with rapid urbanisation and growing climate risks, has weakened the city's competitiveness as an investment and tourism destination. The project brings infrastructure improvements and municipal reforms together to support a more resilient city with better services for people who live in and visit Puducherry.

The loan marks ADB's first engagement in the Union Territory, establishing a partnership with the Government of Puducherry on urban development. ADB Country Director for India Mio Oka said the project supports the bank's work to help Indian cities become engines of economic growth. She described the investment as a step towards making Puducherry a more livable, tourism-friendly and resilient growth hub.

Water and sewer upgrades to expand essential services

The project will upgrade 100 kilometres of water supply network and install 80 kilometres of new pipelines, supported by new overhead service reservoirs. District metered areas and brackish water reverse osmosis desalination plants will form part of the improvements to strengthen water supply services. Sanitation works will include 270 kilometres of new underground sewers, rehabilitation of 80 kilometres of existing sewer network and a new sewage treatment plant capable of treating 50 million litres a day.

Accessible walkways and drainage works to improve public spaces

Public space improvements will include 4.5 kilometres of disability-accessible pedestrian walkways, making accessibility part of the city's infrastructure investment. Drainage systems will be rehabilitated with concrete lining and stabilisation works to improve safety and reduce flooding and accidents. These upgrades will help reduce the effects of extreme weather, supporting safer movement through urban areas and greater resilience in public spaces.

Municipal reforms to support reliable service delivery

The project will introduce more efficient revenue collection, upgraded financial management systems and a digital municipal service management platform to strengthen local government capacity and financial sustainability. Integrated planning for water security and inclusive sanitation will support the infrastructure works, connecting investment in physical assets with improvements in how services are planned and managed. The project complements ADB's wider urban transformation and resilience work in India, including Urban Challenge Fund initiatives and knowledge work on city redevelopment, competitiveness, and sustainable water and sanitation services.