Skip to Main Navigation
BRIEF September 5, 2019

Information Note: Tamil Nadu Sustainable Urban Development Project


Construction of tertiary treatment and reverse osmosis plant with capacity of 45 million of leters per day capacity at Koyambedu

The World Bank in May 2019 conducted a mid-term review of the $400-million Tamil Nadu Sustainable Urban Development Project. The Project supports the Government of Tamil Nadu in strengthening the financial and administrative capacity of Urban Local Bodies (ULBs) to plan, finance and deliver services in a financially sustainable manner.

Project Approved: 31-March-2015; Effective: 21-August-2015; Closing: 31-March-2022

Loan Amount: $400 million; Disbursed: 48%

Project Context:

According to the 2011 Census, Tamil Nadu is 48.5 percent urbanized, with about 35 million people living in towns and cities. The Government of Tamil Nadu’s emphasis on the importance of urban development is laid out in its ‘Vision Tamil Nadu 2023’ document, where it seeks to "promote and facilitate the development of inclusive and sustainable cities".

TNSUDP seeks to help the Government of Tamil Nadu (GoTN) put in place a new model for urban management by empowering select municipalities and providing them results-based grants to improve a range of urban services such as water supply, sewerage, drainage, solid waste management, and urban transportation networks. The cities where urban infrastructure is being improved under the Project are Chennai, Theni-Allinagaram, Pammal, Pallavaram, Namakkal, Nagercoil, Sankarankoil, Cuddalore and Thoothukudi.

The cities of Vellore, Erode and Hosur have also been selected for a ‘Model Cities’ pilot where urban management will be improved in four areas: (i) ULB empowerment and organizational capacity; (ii) spatial/development planning; (iii) sustainable finances; and (iv) e-governance and public disclosure.


Implementation is on track and the project development objectives are expected to be achieved by the closing date of 31 March 2022.

In Chennai, the Project is helping improve stormwater drainage to ensure that the city does not suffer as it did during the floods of 2015.  Some 407 km of drains and canals are expected to be rehabilitated and upgraded by the end of 2019.  The Project is also providing technical assistance for a comprehensive flood warning and control center system for Chennai city. This is scheduled to be completed by October 2020.

An innovative drone-based global information system (GIS) mapping for Chennai is also underway and is scheduled to be completed by March 2020. This mapping will help the city authorities improve urban planning, and facilitate the collection of revenue such as property tax.

With the technical and financial assistance available under the Project, the three Model Cities have increased their own-source revenues, and strengthened the transparency and accountability of the municipal functions in these cities.

Under the e-governance module, a mobile-based interface for citizens called Urban Tree is being developed and will be operational by the end of 2019; this system will allow citizens of these cities to access a range of urban services from their cell phones.

Nearly 100 ULB officers from the Local Fund Audit Department have been trained on audit software in the first phase as part of capacity-building.

Next Steps

Hosur sewerage sub-project will be taken up on a priority basis as all regulatory clearances have now been obtained. While there is an improvement in the management of environmental safeguards for the Project overall, there are pending issues related to the Pallavaram Lakes sub-project in Chennai, including the need to adhere to the disclosed environment management plan, especially with respect to permits for silt disposal. An action plan regarding this is in place.