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the much delayed plan to supply water to Kathmandu is set to roll. On February 13, the Nepal government said the newly formed Kathmandu Upatyaka Khanepani Limited (kukl) would take over the project from the Nepal Water Supply Corporation (nwsc). The government said the corporation had failed to provide water to over 1.5 million residents in the parched areas in Kathmandu valley.

Many of the funding agencies had pulled out of the scheme due to the recent political changes in the country. This time the Asian Development Bank (adb) will give more than $130 million of the $313 million scheme. The government will bear more than $90 million. The rest of the money will come from small funding agencies.

The scheme, to be operational by 2013, aims to bring water from the Melamchi river through a 26 km underground tunnel.Local ngos say the government gave away the contract to a uk -based company. Severn Trent Water, which will manage the supply for six years, was the only bidder. The authorities say local companies are not capable of running such a massive project. But Seven Trent's global performance is not very promising. In February last year, Guyana cancelled a five-year water management contract with the company, saying it did not fulfil the objectives.

Under the new agreement with adb, the Nepal government formed a public-private expert team to advice kukl. This team will monitor the scheme. kukl and nwsc will introduce voluntary retirement scheme for its employees to reduce liabilities. The agreement also enables kukl to reschedule water tariff to recover cost which will shoot up the tariff by 15 per cent. It also allows the government to hike the average tariff per cubic meter water to meet the cost recovery levels agreed with the adb.

The original budget of the project was us $464 million