The development objective of the Water Resources Management Modernization Project for Peru is to improve the management of water resources through the strengthening of the Borrower's capacity for participatory, integrated, basin-scale Water Resources Management (WRM) at the central level and in selected river basins. There are two components to the project. The first component of the project will improve WRM capacity at the national level by supporting: (a) capacity building of the newly created ANA (National Water Authority - Autoridad Nacional del Agua) and formulation of a WRM financing study; (b) establishment of a national water information system; (c) formulation of a national water quality management strategy; and (d) design and launch of a program aimed at introducing a new 'water culture'. The second component of the project will improve WRM in selected river basins by supporting: (a) the creation, capacity building and early operation of river basin organizations in three pilot river basins namely, Chancay-Lambayeque, Chili, Ica-Alto Pampas (Huancavelica), or any other basin as agreed between the Borrower and the Bank; and (b) preparing the ground work in four other basins for integrated, participatory, and basin-scale WRM.