The World Bank is the leading international agency funding various water-related projects in the country. However, the bank's lending activity has been restricted to major water projects while minor projects have been completely neglected. The bank has been avoiding financing (a) early in the construction cycle to avoid drawn-out disbursements and (b) more than halfway through the construction cycle because the bank could have little influence on the outcome of such projects.
Of late, the World Bank is laying stress on water sector reforms and reduction in subsidies as a precondition for granting loans for water projects. The bank is also concentrating more on states which have taken up reforms or have agreed to take up reforms in the water sector before extending loans.
To date most of the bank's lending has been towards urban water projects with rural water projects yet to find favour with the bank.
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