Manila, Sep 27 (IANS): The Asian Development Bank (ADB) on Friday said it has approved a grant of $37.5 million to boost urban services in Nauru.

The Sustainable and Resilient Urban Development Project is funded by the Asian Development Fund, which provides grants to the ADB's poorest and most vulnerable developing members.

The government of Nauru also contributes $2.3 million, Xinhua news agency reported.

"Increasing exposure to natural hazards and poor access to reliable water supply and sanitation has been aggravated by the effects of climate change," the ADB's Pacific Liaison and Coordination Office Regional Director Shane Rosenthal said.

The project will use tanks, pumps and pipes to build Nauru's first reticulated water supply system. This system will serve 55 per cent of the population and strengthen the non-reticulated water supply services for the remaining households while improving access to desalinated water to supplement rainwater.

The bank said the project will improve sanitation services, build an organic waste composting facility, improve materials recovery and recycling, update tariffs, and strengthen cost recovery systems.