WB proposes USD540m water, sanitation project in Sindh

ISLAMABAD: The World Bank has proposed a USD 540 million rural water, sanitation and hygiene (WASH) project for Sindh, including USD 300 million in World Bank financing and USD 150 million in co-financing from the Asian Development Bank (ADB), to provide safe water and sanitation services to 1. 5 million people in the province. According to the World Bank’s Project Information Document (PID), the Sindh Transformational Accelerated Rural Water Supply, Sanitation and Hygiene Services Phase 1 (STAR WASH-1) project is scheduled for appraisal on September 28 and approval on November 25, 2026. READ ALSO: Hyderabad: Clean water scarcity, sewerage issue decried The project, to be implemented through the Sindh People’s Housing for Flood Affectees (SPHF), has a total estimated cost of USD 540. 25 million, with USD 90 million in counterpart funding and a financing gap of USD 0. 25 million. The proposed project comes amid severe deficiencies in rural WASH services, particularly in Sindh, where only 29 percent of the rural population has access to safely managed water, compared with 48 percent in Punjab and 13 percent in Khyber Pakhtunkhwa, the World Bank said. The Bank noted that open defecation remains widespread in rural Sindh, reaching up to 45 percent of the rural population, while poor sanitation, unsafe fecal sludge disposal and contaminated water are contributing to diarrhoea, environmental enteric dysfunction and child stunting. The project is also being positioned as part of efforts to tackle Sindh’s severe human capital deficit. The Bank said two out of every three children under five in rural Sindh are stunted, the highest rate in Pakistan. Under STAR WASH-1, the Bank expects 1. 5 million people to gain access to at least basic water services, including 750, 000 people receiving safely managed water, while another 1. 5 million people are expected to receive safely managed sanitation services. The project also targets a 50 percent reduction in point-of-use water contamination and aims to ensure that 80 percent of rural communities have access to a professional water and sanitation service delivery institution. The largest component, involving USD 482 million, will finance water supply, sanitation and hygiene services. It will include multi-village and single-village water supply schemes, sanitation systems, fecal sludge and wastewater management, drainage, household connections and solarisation. The World Bank said the project would rely mainly on canal water and freshwater sources near perennial canals, reducing pressure on groundwater. Reverse osmosis would be used only on a limited basis where required by water quality conditions. A major feature of the project is the proposed transformation of SPHF into a professional rural WASH utility, with responsibility for planning, owning and operating WASH assets, collecting user charges and managing revenues. The project includes four performance-based conditions worth USD 100 million linked to key institutional reforms. These include approval and launch of a provincial water-quality surveillance programme (USD 10 million), formalisation of SPHF’s mandate as a rural WASH utility (USD 20 million), approval and operationalisation of a user-charge policy (USD 10 million), and establishment and operationalisation of a government-run operations and maintenance fund (USD 60 million). The Bank has stipulated that the Sindh government establish an O&M fund, including Rs5 billion (USD 18 million equivalent) in counterpart financing, to support maintenance of WASH infrastructure. The proposed financing comprises USD 100 million from IBRD, USD 200 million from IDA, USD 150 million from the ADB and USD 90 million in counterpart funding. The World Bank has classified the project’s environmental and social risk as “Substantial”, citing risks including groundwater contamination, unsustainable water abstraction, fecal sludge management, flooding, construction impacts, and exclusion of vulnerable communities. Copyright Business Recorder, 2026

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