KARACHI: The World Bank is giving the Sindh government $1.6 billion over a period of 12 years to overhaul the Karachi Water & Sewerage Board.

The Sindh government with the assistance of World Bank is going to start Rs33.6 billion competitive and Liveable City of Karachi project from next year which is to be completed within a period of five years.
The project is aimed at supporting Karachi Metropolitan Corporation and all six District Municipal Corporations, District Council Karachi and Excise & taxation Department for detailed property survey in the city. The provincial Investment Department would also be supported under the project for talking positive steps towards ease of doing business.

This was disclosed in a meeting the chief minister held with a two-member delegation of World Bank led by Acting Country Director Ms Melinda Goods and Ms Amina Raja, Senior WB Operation officer here at the CM House. The meeting was attended by Minister Local Government Saeed Ghani, Chief Secretary Mumtaz Shah, Chairperson P&D Nahid Shah, Principal Secretary to CM Sajid Jamal Abro, Secretary Local Government Khalid Hyder Shah and others.

The chief minister directed Chief Secretary to hold joint meeting of KMC, DMCs, District Council and Excise & Taxation department to chalk out a plan to formally devolve the collection of property tax. “I am keen to financially strengthen the local bodies in the city so that they emerge as self-sufficient organisations,” he said and added under the project capacity building of the concerned local bodies would also be made for collection of the property tax.

KWSSIP: Chief Minister Syed Murad Ali Shah also said that Karachi Water & Sewerage System Improvement Project was being launched with the assistance of the World Bank for $1.6 billion over a period of 12 years under which Karachi Water & Sewerage Board would be overhauled. “I am committed to make KWSB a self-sustainable and efficient service providing organization,” he said.

The World Bank team and the chief minister discussed modalities and implementation methodology in their meeting.

Chairperson P&D Naheed Shah told the meeting that the first phase of the scheme of over-hauling KWSB has been approved for Rs14.7 billion over a period of five years. It has also been approved the CDWP.

The KWSSIP is a three phase project. The first phase is estimated at a cost of $ 400 million focusing on improving water and wastewater services and a defined set of Institutional Reforms to transform Karachi Water & Sewerage Board into a financially viable utility.

Under the project, the World Bank would finance $400 million three Investment Plans of KWSSIP that include Reform in Karachi Water & Sewerage Board of $ 30 million; Securing Sustainable Water Supply & Sewerage of $ 350 million and Project Management & Studies of $ 20.00 Million.

CLICK: Karachi Urban Management Project (KUMP) has been renamed as Competitive and Livable City of Karachi (CLICK). It is a $250 million project and to be completed within five years. The project has three components such as Performance-based block grants to Karachi urban local councils of $ 120 million; Strategic infrastructure investment and capacity building in integrated storm water drainage and solid waste management of $ 50 million and Support for Urban Immovable Property Tax reform and institutional capacity building of $30 million. The Tax reform component includes a Support for improvement & devolution of Urban Immovable Property Tax (UIPT). The fourth component is and $ 50M.

Performance-based Grants: The performance-based block grants to Karachi urban local councils have been approved at $120 million. This component will finance formula-based block grant to KMC and the six DMCs upon achievement of results by providing incentive to urban local councils to improve their institutional performance and capacity in areas of investment planning and execution, financial management, procurement, social and environmental, business environment, and citizen engagement/accountability.

The grants would be used to fund local level infrastructure and municipal services within respective mandates of KMC and the DMCs to improve Karachi’s livability and competitiveness. Indicative eligible investments may include small secondary/tertiary drainage works, municipal roads, street lighting, parks and other public spaces, public buildings and markets.

Strategic Investment: Strategic infrastructure investment and capacity building in integrated storm water drainage and solid waste management is a $50 million component. This will finance strategic city-wide (inter-jurisdictional) infrastructure needed to enhance Karachi’s livability and competitiveness. The component will focus on two interlinked sectoral interventions of integrated storm water drainage and solid waste management (SWM), and include development of drainage and SWM master plans, financing models, public awareness campaigns, feasibility studies for private financing models, etc. tentative technical assistance activities and selective investments in integrated drainage and SWM are included.

Urban Property: Support for Urban Immovable Property Tax reform and institutional capacity building is a $30 million component. It will be a Support for improvement & devolution of Urban Immovable Property Tax (UIPT). This sub-component will support the devolution of administrative functions of the UIPT to local bodies of Karachi. A phased roadmap to implement the administrative improvements and devolution of urban property tax and its respective institutional model have been developed with the objective of substantially increasing public revenues through UIPT reform.

Reform activities to be supported during Phase-I include comprehensive all-Karachi property survey to update property tax database and fiscal cadaster and digitization of the property tax base for all six districts in Karachi. IT systems upgrades; training and capacity-building support; and implementation of a revised institutional structure.

Phase-II may focus on deeper reforms of the property tax system. The collection function may be devolved to DMCs in a phased and gradual manner, whereas a number of options are being considered for provincial level management of an ICT Platform that manages the fiscal cadastre/property register.

Institutional capacity building and implementation support. This sub-component will finance supply-side capacity building interventions for Karachi local governments in areas of financial management, project implementation, social and environmental management, and technical assistance to enhance metropolitan coordination between the local bodies.

Regulatory Environment: Support for enhanced regulatory environment and infrastructure financing for competitive Karachi is a $ 50 million component. This will support developing a strategy, roadmap and institutional architecture for infrastructure financing model and enhancing regulatory environment for improved competitiveness in Karachi. The main activities to be financed include technical assistance and feasibility studies for developing and setting up a proposed Karachi Infrastructure Fund (KIF); and technical assistance program targeted at KMC and DMCs for piloting PPPs for service and infrastructure provision. This component will finance improving regulatory and doing business environment, by simplifying, streamlining, modernizing and automating regulatory governance, and improving commercial dispute resolutions, particularly related to property rights.

The Project’s main coordinating agency would be Local Government Department. A Project Management Unit (PMU) would be established to provide overall coordinating and necessary technical assistance to Karachi’s local councils. The project’s executing agencies for specific interventions under this arrangement will be KMC, DMCs, water board and excise & taxation department for their respective components.