The source said that the contract is for a turnkey project. The new water mains will have an annual capacity of 38 million cubic meters, and the project will cost US$48.3 million.

The Export-Import Bank of China will issue a US$44.97 million loan refinanced by the National Bank for Foreign Economic Activity of the Republic of Uzbekistan, and Suvokava (Vodokanal) Company, based in Fergana, will also contribute to the project.

A loan agreement will be signed in the near future. The water main development is part of a project aimed at drastically improving water supplies in Fergana, Margilan and adjoining townships.

Uzbek President Islam Karimov approved the project. Uzbekistan is implementing three other water supply investment projects, including one in Buhara and Samarkand funded with a US$40 million loan from the International Bank for Reconstruction and Development, as well as two other involving Gulistan, Jizak and Karshi, and villages in the Navoi and Kashkadarya regions, with funding of US$36 million and US$25 million respectively from the Asian Development Bank.

The Export-Import Bank of China opened a US$300 million credit line for Uzbekistan in 2004. The National Bank for Foreign Economic Activity of the Republic of Uzbekistan has received US$212 million from the credit line and funded six projects in the areas of telecom, land reclamation, electric power, oil and gas.