The Japan International Cooperation Agency (JICA) will lend Rs 2,587 crore to the Bangalore Water Supply and Sewerage Board (BWSSB) for implementing the Cauvery V Stage project for supplying drinking water to 110 villages around Bengaluru.
S Selvakumar, Joint Secretary, Department of Economic Affairs, Ministry of Finance, and Kenji Hiramatsu, the Ambassador of Japan to India, exchanged loan documents here on Wednesday. JICA is an agency of the Japanese government that provides official development assistance (ODA).
The villages fall in Mahadevapura, Bommanahalli, Rajarajeshwari Nagar, Dasarahalli and Byatrayanapura zones of the Bruhat Bengaluru Mahanagara Palike (BBMP).
The project also involves the construction of water and sewage treatment plants and improving the living conditions of local residents, the ministry said in a statement. The total cost of the project is around Rs 5,550 crore. The JICA has sanctioned Rs 2,587 crore while the state government will mobilise the rest from different sources.
"Once the Cauvery V Stage is completed, the supply of water is estimated to increase from around 1.3 million cubic metres per day to 1.7 million cubic metres per day in 2026," the statement said.
Since it's a soft loan, the rate of interest will be 1.3% per year for sewerage portion of the project, 1.5% per year for other portions and 0.01% per year for consulting services, said a note from the Japanese embassy. The repayment period will be 20 years after the grace period of 10 years, said an official in the ministry.