The loan is the second tranche of a US$300 million multi tranche financing facility (MFF) - ADB’s first MFF investment programme to Uzbekistan. The programme aims to improve the living standards, environment, and health of three million people in Uzbekistan.

The second tranche will be directed to modernizations of water channels in five cities of Ferghana Valley – Andijan, Marilan, Kokand, Ferghana and Rishtan cities. The programme implementation will help to provide safe, reliable, and sustainable water supply and sanitation services and improved hygiene for 1.4 million people.

In September 2009, the ADB extended up to US$300 million in financial assistance to Uzbekistan to overhaul its ageing water and sanitation systems to improve the health and hygiene of about three million people.

The multitranche financing facility of the Water Supply and Sanitation Services Investment Program is targeted at provincial cities and secondary towns in eight provinces. The nine-year program, costing around US$375 million, supports the government’s push to deliver safe water and expand the sanitation coverage to all urban dwellers and up to 85% of the rural population within the next decade. Development Fund.

The ADB and the Government of Uzbekistan signed a credit agreement on allocation of the first tranche at the size of US$60 million on 1 December 2009.

The first tranche was directed to finance improvements to water source and distribution systems in Damkhodja and 11 district centers in Bukhara and Navoi provinces, as well as upgrade wastewater treatment plant and sewerage systems in the capital city of Surkhandarya province.