The development objectives of the Second Urban Development Project for Bhutan are to:
(i) Support Bhutan’s municipal reform program by strengthening municipal finance and management systems in Thimphu and Phuentsholing; and
(ii) Improve infrastructure services in northern Thimphu where no formal services are currently available.
There are three components to the project. The first component of the project is municipal finance and management. This component aims at strengthening the institutional systems and processes of the two city corporations of Thimphu and Phuentsholing to enable them to function effectively as efficient, transparent and accountable urban local governments.
The second component of the project is Thimphu Northern area development. This component will develop infrastructure systems through land pooling in the two local areas of northern Thimphu (Dechencholing and Langjophakha), where the preparation for land-pooling is most advanced. The project will finance development of basic infrastructure systems in these areas, including roads, storm water drainage, water supply, sewerage, and street lighting.
The third component of the project is capacity building. This component will provide resources for training programs, equipment, technical assistance, and studies based on the perceived needs of the Thimphu and Phuentsholing city corporations and of the Ministry of Works and Human Settlements (MoWHS).