VISAKHAPATNAM: The Greater Visakhapatnam Municipal Corporation (GVMC) has secured an investment of $60 million (Rs 498 crore) from the International Finance Corporation (IFC), a member of the World Bank Group, for the Madhurawada Sewerage System Project.
The Trust Deed was signed by GVMC Commissioner Ketan Garg and Victoria Delmon, Asia Head of IFC, in the presence of Chief Minister N Chandrababu Naidu, and Suresh Kumar, Principal Secretary of Municipal Administration and Urban Development (MAUD) Department, at the State Secretariat on Monday.
Madhurawada with a population of over 2,50,000 people is one of the fastest growing regions in the GVMC. It has long struggled with inadequate sanitation facilities, resulting in untreated wastewater being discharged into water bodies.
The new sewerage system will address these challenges, and serve the growing population for the next 30 years. The system will include an underground sewer network, pumping stations and a wastewater treatment plant.
Project expected to improve public health, address climate challenges
Highlighting the path-breaking nature of the partnership, Suresh Kumar said, “This collaboration with the IFC is a transformative step not just for Visakhapatnam but for urban India as a whole.
It signals to the world that Indian cities, when financially disciplined, and administratively progressive, can attract global investments without sovereign guarantees. The Madhurawada project is more than a sewerage system, and it represents a forward-looking model of sustainable urban growth, resilience, and self-reliance. Our vision is to create a city that is not only cleaner and healthier but also sets a precedent for other cities aspiring to modernise with global standards of financing and governance.”
Makhtar Diop, Managing Director of IFC, said, “When cities have the vision to lead, innovative financing can be a catalyst for massive urban transformation.
Our partnership with the GVMC shows how municipalities can mobilise private capital to deliver essential services affordably without sovereign guarantees. This first-of-its-kind municipal financing will help protect the city’s coastline, create jobs, and set a new benchmark for low-carbon growth. It is testament to the World Bank Group’s commitment to help cities leverage limited public funds to attract global private investment. What India is pioneering today can inspire cities everywhere to build cleaner, more resilient, and future-ready urban spaces.” The total project cost is Rs 553 crore, and of which Rs 498 crore will be provided by IFC through Non-Convertible Debentures (NCDs).
The remaining Rs 55 crore will come from the Centre’s AMRUT 2.0 scheme (Rs 45.64 crore), and the GVMC’s own resources (Rs 9.36 cr. The 15-year loan agreement includes a 3-year moratorium on principal repayment, followed by 12 years of repayment at an interest rate of 8.15% per annum. The project is expected to bring significant benefits, including improvements in public health, better environmental protection, and enhanced climate resilience. It is also anticipated to attract further investment to the region, raise property values, and create jobs.
Ketan Garg outlined that the IFC investment will finance the development of sewerage infrastructure in Madhurawada, which currently has only 20% coverage. The project will expand the network by 400 km, including wastewater pumping, and lift stations. It will ensure 100% coverage of households in Madhurawada by 2030, with a new 38 MLD Sewage Treatment Plant (STP) developed in phases.
The plant’s operations will begin with a 20 MLD capacity by 2028, and reach full capacity by 2043, benefiting nearly 82,900 households. The GVMC also plans to incorporate wastewater recycling, and reuse components in later phases to economise the use of fresh water, particularly for industries and commercial establishments, he added.