Manila, Nov 19 (IANS): The Asian Development Bank (ADB) and Tuvalu on Tuesday signed a grant agreement amounting to $16.53 million to support the improvement of water supply and sanitation management in the country's capital Funafuti.

Funafuti faces many urban challenges, particularly inadequate water supply and sanitation services, and an increasingly high rate of infectious diseases, the ADB said in its press release, adding that since it is an atoll, rainwater and limited groundwater are the only naturally available water resources, Xinhua news agency reported.

The ADB said the project's new water supply network will improve households' access to desalinated water, build resilience to droughts, and relieve the burden of households in meeting their basic water supply needs.

"Through the project, Tuvalu for the first time will construct a reticulated water supply network, which will benefit more than half of the country's population," said ADB Pacific Subregional Office Regional Director Aaron Batten.