About FIRE-D

From 1994 to 2011, USAID’s Financial Institutions Reform and Expansion–Debt and Infrastructure (FIRE-D) activity partnered with India’s central, state, and municipal governments in 16 states to expand sustainable water and sanitation (WatSan) access to the poor, while improving the ability of city and state governments to mobilize resources and increase their revenues.  

FIRE-D piloted policy-related interventions to better plan, design, and finance urban infrastructure. The most successful solutions were then expanded and incorporated into a Government of India (GoI) urban development scheme called the Jawaharlal Nehru National Urban Renewal Mission (JNNURM).

What We Did

The evaluation team followed up on six states and cities seven years after FIRE-D ended to understand how urban WatSan services have changed and to what extent policies, practices, and financing mechanisms introduced through FIRE-D have been sustained. Lessons from this evaluation are intended to inform USAID activity design improvements in India and other urban WatSan contexts.

How We Did It

In March 2018, an evaluation team completed 49 key informant interviews and reviewed municipal WatSan quantitative data on access. The team interviewed stakeholder groups representing national, state, and municipal government; utilities; NGOs that advocate for the poor and informal settlement dwellers; other donors; former FIRE-D implementers; and USAID.

The information gathered helped the team examine the sustainability of selected FIRE-D approaches to develop urban environmental services, ensure the poor have access to those services, and improve the ability of city and state governments to mobilize resources and increase their revenues.

What We Learned

In most of the cities evaluated, the proportion of households with piped water and household toilet access increased or remained the same despite population growth.

Few cities could claim financial stability and many continue to struggle with inefficient tax and tariff collection. In spite of this challenge, several reforms put into place by FIRE-D activities showed long-term sustainability:

• Financial reforms have improved the revenue picture at nearly all evaluation sites.
• Property tax reforms, asset mapping, e-governance, and leakage and energy audits have been maintained.
• Improved accounting practices have also continued and expanded.

FIRE-D pioneered municipal credit ratings and supported the subsequent issue of municipal bonds to finance WatSan development projects in India.

• Two of the evaluated municipal sites— Pune City and Tamil Nadu State—continue to issue bonds for WatSan.
• In the other sites, the availability of cheaper and less administratively burdensome capital from government grants and other donors has largely suppressed the incentive to seek market-based financing for WatSan development.

Other findings indicate that stakeholders show little interest in establishing public-private partnerships for WatSan services for the following reasons:

• Perceived lack of commercial viability or profitability due to inefficient user fee collection.
• The potential of political incentives to keep tariffs low and avoid arousing a negative public backlash related to privatizing services.

Finally, the evaluation found that government stakeholders still have relatively low capacity to plan and manage WatSan development. Still, City Managers’ Associations established by FIRE-D demonstrate potential for successful long-term capacity building support, provided that they can adopt a clear mandate and bylaws that protect their function when leadership changes.

Next Steps

FIRE-D drove sustainability through its deliberate integration into the GoI’s JNNURM WatSan funding and reform scheme. This government partnership approach should be replicated as a key way to advance a country’s journey to self-reliance. Also, the continued success of various revenue management and stability mechanisms highlights the value of these efforts in future activities. All such activities should acknowledge and seek ways to address key barriers in the policy environment, such as decentralization or land tenure rights.

For more detailed information read the accompanying blog, contact the Water CKM M&E Specialist, or check out the resources below.

• Full evaluation
• Evaluation brief
• Executive summary (Hindi)
• Webinar presentation on findings
• FIRE-D Guidebook

About the Ex-Post Evaluation Series

The USAID Water Office is conducting a series of independent ex-post evaluations of the Agency’s water, sanitation, and hygiene (WASH) activities to inform future USAID investments in the sector and to better understand the long-term impact and sustainability of its interventions several years after projects close. The FIRE-D evaluation is the fourth in the series.

This evaluation series will help USAID understand whether and how its activity results have been sustained. All activities included in the series must have been closed for a minimum of three years and could not be recipients of Office of U.S. Foreign Disaster Assistance or Food for Peace funding. Preference is given to USAID missions that are at a point in their design cycle to incorporate learnings into upcoming WASH programs.

This evaluation series builds upon USAID and Rotary International’s WASH Sustainability Index Tool, a framework to assess a WASH activity’s likelihood to be sustainable according to the following factors: availability of finance for sanitation; local capacity for construction and maintenance of latrines; the influence of social norms; and governance.